Samsung expands payment business to smartwatches

Bloomberg

Samsung Electronics Co. unveiled its new wristwatch device in Berlin, which includes support for contactless payments, as the company pushes to catch up to Apple Inc. in a still nascent market of wearable products.
At the IFA technology tradeshow, the world’s biggest smartphone maker introduced the Gear S3 Classic and Gear S3 Frontier — two variations of the same base product, which support Samsung Pay and on the Frontier version also allow users to make phone calls or even book an Uber ride from the device without the need for a smartphone to be connected.
“We want people to be able to leave their phone at home and use only the Gear,” Tony Kim, from Samsung’s global product planning team, said ahead of the product’s announcement.
Samsung, which introduced its first wristwatch-like device in 2013 ahead of Apple and other rivals to carve a share of the just-forming wearable market, failed to draw people’s attention to the new watch category. But it has steadily been increasing the feature sets of such products, making them less dependent on being permanently in range of a connected phone.

CONTACTLESS PAYMENTS
Apple is slightly ahead of Samsung in rolling out its Apple Pay contactless payment business — currently present in nine regions compared to Samsung’s eight. Both systems let consumers register a credit or bank card to their phones in order to make small contactless payments in stores, taxis, or on public transport. And both companies now have wearables that support the technology.
But it’s the cellular features of the Gear line that may be a sore spot for Apple, which had been trying to incorporate similar technology into the next version of the Apple Watch but ran into delays. The feature in Samsung’s model allows the watch to have its own phone number for making phone calls, sending SMS messages or using apps from Spotify Ltd or Uber Technologies Inc. Only U.S. and Korean versions of the Gear will support this feature, with other regions needing Wi-Fi or to be connected via Bluetooth to a compatible phone.
Samsung’s incorporation of cellular connectivity into the previous Gear models was a key contributor to the product line’s success, according to market analysis published by research group IDC in July. “Focusing on the telco channel to drive future success in telco-driven markets is likely to remain the core strategy for Samsung moving forward,” the group concluded.

COMPATIBILITY GROANS
Other features of the Gear S3 include a 1.3-inch color display, a GPS location sensor, 4GB of internal memory, wireless charging, and a battery the company says will last between three and four days on a single charge. It’s also resistant to water and dust.
Just as Apple’s smartwatch does not connect to Samsung’s phones, Samsung’s Gear S3 doesn’t connect to its rival’s iPhone range, although it’s compatible with many competing Android devices such as those manufactured by Sony Corp. and LG Electronics Inc.
“We started a beta program for iOS in Korea on the S2. We opened it in beta to get feedback from our users about their experience,” said Kim. “There are no plans at this point to do this with the S3 but we’ll continue to revisit as we go along.”