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Australian banks won't rule yet on Apple bank negotiations

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A man looks up as he stands next to a line for two National Australia Bank Ltd (NAB) automatic teller machines (ATMs) in central Sydney in this picture taken August 23, 2013. REUTERS/David Gray/

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Last month, several of Australia's largest banks, including Commonwealth Bank, National Australia Bank, and Westpac, applied to the Australian Competition and Consumer Commissions (ACCC) to get permission to jointly negotiate with Apple for access to the iPhone hardware necessary to build their own mobile wallets for the platform.

These banks had requested authorization within 28 days of their initial request in order to begin negotiating, according to ZDNet. But on Friday, the ACCC ruled against that interim authorization, and told banks to expect a draft decision by October.

That delay is "not indicative of the outcome," but could ultimately hurt the banks' negotiating power.

  • The ACCC ruled against the interim authorization because it wants more time. The commission considered the impact the negotiations would have on market competition, the extent of the request's urgency, harm to applicants or other parties, and public benefits and detriments before making its decision, according to ZDNet. It cited the complexity of the issue combined with the limited time in its decision to continue the process.
  • But in that time period, consumer demand for Apple Pay and other third-party wallets could push customers away form the banks participating in the boycott. ANZ, the only Australian major bank that offers Apple Pay support to its customers, saw demand "skyrocket" following the wallet's April launch. That indicates pent-up demand among Australian iPhone users, who are essentially locked out of the country's mobile wallet ecosystem because their banks offer proprietary wallets just for Android users and won't partner with Apple. If that demand continues to rise, consumers could leave the banks taking part in the inquiry in order to join ANZ or American Express and begin using the wallet.

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