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Square’s Disruptive New iPad Payments Service Will Replace Cash Registers
- kenjackson 15y agoWhat's the innovation here? I mean its great if I already have an iPad at checkout. But why would I buy a $500 device to sit next to my cash register? Or if I'm going all credit and debit, there are already services that work with $250 netbooks. And beyond that you can just lease the little boxes for like $20/month+some surcharge. It seems cool for techies, but is it really going to change the game? UPDATE: Although this seems like more of a win for door to door sales and maybe mall kiosks.
- roc 15y ago> "What's the innovation here?" I think you're getting hung up on the form-factor of the iPad and missing the novel part: the software. It not only gives every merchant the advantage of loyalty-card-type data streams, but gives tools that leverage that data to the customers as well. Cash register software is notoriously bad. Even the big shops that spend millions on it. It really wouldn't take much to upend that business.
- kenjackson 15y agoIf you're looking at just SW, how's it compare to Quickbooks POS?
- danilocampos 15y agoCard processing for everyone, anywhere with internet access without the need for a commitment, a costly investment in hardware or a separate merchant account. The UX isn't just good from a hardware perspective – it's also awesome in how you get paid. There's a solid chunk of people who could benefit from accepting credit cards for whom the setup you've described isn't really worth it. Moreover, if you already have an iDevice, which isn't much of a stretch, you now have a credit card terminal for free.
- stevelosh 15y ago> But why would I buy a $500 device to sit next to my cash register? Because many "point of sale systems" cost far, far more than $500 and are steaming piles of bad user experience. > Although this seems like more of a win for door to door sales and maybe mall kiosks. Definitely, and private instructors as well. I teach dance classes/private lessons and being able to take a card right on the spot is incredibly convenient.
- kenjackson 15y agoBecause many "point of sale systems" cost far, far more than $500 and are steaming piles of bad user experience. But those systems that cost more than $500 take credit, cash, and check. And you get accounting for all of the different types of sales you do. You still need that machine, if you do cash/check sales.
- stevelosh 15y agoSquare lets you record cash purchases, so you don't need the machine: http://d.pr/dGVT http://d.pr/dGVT Yes, if you need a much more complicated system then you'll need to pay more, but many people don't. There's no way I could afford, or would want to use, most POS systems out there.
- kenjackson 15y agoBut it's not just taking the cash, but the complete workflow. But really that's another point that's not so important. My broader point is that this doesn't feel extremely innovative or disruptive. I knew people who did laptop based credit card processing... what 15 years ago? Didn't have the slider, so you had to type the number. And today I can get the equipment for just CC processing for free. And there is some decent software, but the best, like Intuit's is paid. But this feels really incremental over the course of 15 years. The SW is cheaper, but the transaction percentage is much higher. This doesn't feel like a shift in the way people buy things or companies collect payment in the same way as checks/credit cards/paypal/debit cards did. Not saying its a bad product, but I'm not seeing the innovation/disruption. I'm seeing a good next step for some use cases.
- petervandijck 15y agoJack Dorsey is practicing to take over the reins from Steve Jobs. Not bad.
- CodeMage 15y agoEvery time someone talks about Square, they call their service "disruptive". Sorry if I'm being dense, but what is it that they're disrupting?
- SandB0x 15y agoYou gotta disrupt to get ahead. This can only be achieved after rejection therapy and pivoting.
- thinkcomp 15y agoNothing. Square further propagates the status quo (plastic cards). There's no disruption involved. That's why Visa is an investor.
- roc 15y agoIt looks more like a trojan horse to me. If they become the new merchant-interface, there's nothing stopping them from offering an alternate payment mechanism that doesn't rely on credit or debit cards.
- sliverstorm 15y agoNothing stopping them- until Visa buys them.
- goatforce5 15y agoBuilding the technology that could support Visa/MC/Amex alternatives and the userbase that gives it critical mass is probably the best way to get bought out by Visa/MC/Amex at an inflated price. No one says they actually have to ship their alternative payment system.
- jes5199 15y agoI'm an engineer at Square, so I can neither confirm or deny such speculation ... but in an interview with Wired, CEO Jack said "People understand credit cards. They know exactly what to expect from them. They’re used everywhere. But Square is payment-device agnostic. It doesn’t matter how you pay. Some of our users accept only cash." http://www.wired.com/magazine/2011/05/mf_qadorsey/all/1 http://www.wired.com/magazine/2011/05/mf_qadorsey/all/1
- holman 15y agoReally stoked about this. I wish they had more details on the process, though. At first exposure, the idea sounds really, really cool. But it sounds like they're breaking the normal purchase loop. Imagine lunch, for example (assuming you've already set up your tab, which is a lengthier first-run experience). You go up to pay, and then... what? TC explains it as: > So once you press that button within two blocks of the merchant, you’ll be able to tell the cashier your name and your card will be charged on the merchant’s backend Square register. So do you pay in advance? Afterwards? (In which case, can I just walk out and screw the retailer?) Do I as the user set up the bill, or does the merchant and I have to review it? Does either party have to wait for the other to confirm something? I've already been at Square retailers that have skipped Square during times of high customer peaks (opting for cash, which was much quicker). These are probably just early questions that will look obvious and boring once it's all figured out and public, but right now I'm scratching my head a little.
- puls 15y agoWhen you open a tab, your name just shows up next to the "charge a card" button. You pay when you normally would. It's not really breaking the normal purchase loop so much as removing all of the crap from it.
- wccrawford 15y ago
- nextparadigms 15y agoWon't Square be affected by NFC payments when they arrive?
- danilocampos 15y agoThat's a big when. But in the end, NFC is a hardware issue. Square is adding the most value on the software and financial side of the equation. If anything, Square strikes me as the best positioned party, other than Apple, to capitalize on NFC once it sees some broad adoption. If Apple makes the NFC APIs private, though, that could put the hurt on Square given their heavy iOS investment.
- dangrossman 15y agoSquare would just build an NFC reader into the Square hardware. The phone doesn't know what's being transmitted down its headphone jack, right?
- danilocampos 15y agoSure! But Square enjoys a tremendous user experience advantage. It's easier for everyone to use. Now, in my theoretical universe where Apple is a bunch of dicks and decides that they'll keep the NFC APIs to themselves, and assuming they run a service that competes with Square... Who's going to want to attach a plastic weiner to their phone versus just having the "magical, it just works" action that Apple will provide with their service? Of course, it may well be that Apple wants a usurious fee for their service (30%!) and Square could still compete on price. Still – a world where Square can harness NFC directly on an Apple device is a much better deal for them than one where they can't.
- roc 15y agoHow would a private NFC API be any different than the non-existent stripe reader on the iphones? Should NFC (finally) start to catch on, couldn't Square just add an NFC module and continue to pipe data in via the headphone jack?
- tomjen3 15y ago
- inkaudio 15y agoI didn't read anything about square providing hardware to store cash. It can't replace traditional cash register if the system does not accept cash. There already more mature Mac based cash registers that it would be competing with.
- grandalf 15y agoWhy is the magnetic stripe reader necessary? Why not just use the camera to OCR the card itself?
- danilocampos 15y agoBecause the magnetic stripe contains a security code that's not otherwise represented on the card. Including that code in the transaction gets you a better rate, since the physical presence of a card may signal a lower risk of fraud. (2.75% flat for a swipe versus 3.5% and 15¢ for keying in the number, according to Square's site)
- grandalf 15y agoDoes it follow from this that manual carbon copy "imprint" machines are not eligible for card present rates? This may sound dumb, but why not just put this additional security code in a bar code or QR code somewhere on the surface of the card to allow for the equivalent security using a camera to read the card?
- pbreit 15y agoNo, the opposite. A manual imprint is even more indicative of card-present than a mag-stripe read (which can be easily faked). Reading QR or other codes with a smartphone's camera is extremely cumbersome whereas swiping a mag-stripe is simple and reliable.
- grandalf 15y agoI totally don't agree with your assessment of what is simple and reliable. I've had the mag stripe fail on numerous hotel room keys and a few credit cards over the years. A QR code is readable even if somewhat scuffed, etc. It would seem that with a small investment in a magnetic stripe writer and a plastic mould, any scammer could create cards that could fool an imprint swiper or magnetic stripe reader. Further, wouldn't a signature make all of the above close to equivalent?
- thinkcomp 15y agoIf anyone is interested, FaceCash Register works with cash, credit cards, and FaceCash payments too. https://www.facecash.com/register.html https://www.facecash.com/register.html It's JavaScript-based so it works on just about every platform, not just iPad.
- cwilson 15y agoI'm not sure if many HN users are familiar with TabbedOut (there are quite a few venues in Austin that support it), but there is definitely some cross-over here with the Square Case. Specifically if this works in bars. Essentially you can open and close a tab with a bar whenever you want. Forget to close your tab and realize you're a mile away from the bar? No problem, you can close it and add tip from anywhere. Forget your credit card often at bars? You don't give them a CC in the first place because it's stored in your TabbedOut account. It also does nifty things like allow you to split checks via the app at restaurants, which is super useful. One of TabbedOut's big accomplishments is they have invested quite a bit of time/money integrating with point of sale systems which is what allows them to have such a slick user experience. I'm curious if this is something Square has done as well.
- pbreit 15y agoNo. Square has built it's own iPad-based POS software.
- smackfu 15y agoHow does TabbedOut actually work at a crowded bar? When I have a credit card tab, they usually need the name on the card to find the tab.
- thinkcomp 15y agoTabbedOut requires each user to use a five-character alphanumeric code, similar to the kind you'd get when booking an airline ticket. I'm not sure how the bartender is supposed to remember everyone's code (let alone people who have had too much to drink), but that's the general idea.
- baptistepicard 15y agoThis is another brilliant call from Square. NFC technology is not yet developed and many problems still exist for the implementation (the iPhone 5 might not have the appropriate chip for example), whereas square seems to make it easy for both customers and merchants. The only problem I see is that this square technology is suitable for the US market but I'm not so sure about Europe.
- iloveponies 15y agoNFC's problem is not technology - it's the lack of implementation.
- cssmith 15y ago>500,000 Square card readers shipped, 1 million Square transactions in May So, half a million card readers have been shipped and they've each been used, on average, twice in this month? That seems really low to me. Do a lot of merchants get the reader and not use it at all?
- dangrossman 15y agoA lot of people asked for a reader simply because it's a neat gadget and it's free, never intending to use it in a business.
- jamesjyu 15y agoYep. That's exactly the reason I got one.
- r0s 15y agoYes, we have one and use it infrequently to process event sales, whereas the vast majority of our sales are online.
- lionheart 15y agoMy local coffee shop here in Tempe, AZ switched over to using an iPad with Square instead of a cash register about a month ago. As a customer I like it. It's fast and slick. The employees seem to like it too. Only one thing: if anybody from Square is reading this look into allowing the option of a bigger, sturdier card reader. The little on you ship now is flimsy and doesn't work too well if you use it 500 times a day.
- pkamb 15y agoThat's what I keep thinking every time I see a picture of the thing. Looks like it would just rotate in the round headphone jack every time you swiped a card.
- lionheart 15y agoIt's actually not that bad. And it looks like its perfect if you're using it for payments on the move. But if you're not going to be moving the payment station around you should be able to opt into a bigger and sturdier one.
- jmm 15y agoKickstarter campaign, anyone? (to produce an iPad + Square dongle enclosure)
- brianbreslin 15y agoGreat idea. If I were even remotely an industrial designer I'd build in a stand as well
- busted 15y agoHow do they deal with cash payments?
- lionheart 15y agoThe Square app does all the typical register calculations for cash too, then they just have a little cash holder box on the table where they put it.
- 46Bit 15y agoA problem that's immediately been raised by shop owners I know is that of theft - regardless of how much of a brick it might be to them (strong non-numeric passcode etc). You can't just walk off with a cash register, or at least fence it easily & for much.
- deleted 15y ago[deleted]
- pitdesi 15y agoThis is fantastic news for small coffeeshops etc everywhere.. This makes for a very compelling use case. It is now far cheaper than a merchant account or verifone for smaller merchants, when factoring in that you get a free POS system. Hopefully this will stop the insanity of some payment processors giving out "free pos" systems but raping merchants on the credit card processing. We've seen restaurants paying as much as an effective rate of 7%! because they were going with the company that gave them a "free" POS system. relevant: http://feefighters.com/square-calculator http://feefighters.com/square-calculator - a reminder of how good Square's pricing is (relative to a merchant account) for coffeshops, etc.
- deleted 15y ago[deleted]
- dr_ 15y agoThere was an article suggesting that Apple should purchase a carrier, like Sprint. Wrong. Square is the company they should really focus on buying.
- mattvot 15y agoNo it won't, for one good reason. I can buy a Cash Register for around $50, whereas iPads start from $500
- jrockway 15y agoA cash register, yes, but what about one that can process credit cards?
- patr1ck 15y agoActually most cash registers start at between $100-$200, and don't do credit card processing, much less SMS receipts, Google-analytics style sales data tracking, etc etc etc... The value of Square + iPad beats the pants off what sort of cash register you can buy for $500. Not to mention that when the day is over, you have an iPad.
- kgermino 15y agoIs it just me or does the CrunchBase entry for Square read like it came straight from their PR team?
- pitdesi 15y agohttp://www.crunchbase.com/company/square http://www.crunchbase.com/company/square Most crunchbase entries do come straight from the PR team... Users can edit them, so most companies do and Crunchbase says what you want it to. It's sort of like a moderated wiki.
- kgermino 15y agoInteresting, I didn't realize it was community edited. Thanks.
- creativeone 15y agoDo they have an affiliate program? Or can I become and outside sales rep in another country?
- ROFISH 15y agoDoes anybody know how programmable their POS is? (ie. if there's a sale, is there a webhook that can be called?)
- jes5199 15y agoNo public APIs yet, but we'll get there. (I'm an engineer at Square)
- ROFISH 15y agoThanks! We use Square to handle credit card payments for conventions, but it's quite annoying to swap between an in-house iPad webapp that handles inventory, receipt printing, and sending the order data to a master database. Allowing simple iOS protocol handlers like "square://pay?product1=Mug&price1=20.00&product2=Shirt&price2=22.00&callback=inventorify%3A%2F%2Fsquare_callback" and it callsback to url "inventorify://square_callback?success=true&paid=42.00" would be amazing as I don't have to have the awkward step of "Exit the inventorify app and charge the customer for $42.00 through the Square app" and then the cashier forgets the amount to charge for.
- seikatsu 15y agoWonder if all the Square attention is good for the broader "POS disruption" space? For example Erply (http://www.erply.com/ http://www.erply.com/), an award-winning startup, recently made news with porting their web based POS solution to iPads recently. Any others you know?
- tbgvi 15y agoMy company, Cashier Live (http://www.cashierlive.com http://www.cashierlive.com), is in the same space as Erply and some others. We haven't ran into Square competitively at all, as Square is getting their business traction from mobile businesses & small quick serve restaurants/coffee shops/bakeries etc.. Cashier Live (and Erply, from what I can tell) is targeted towards retailers with inventory on the shelves, something Square isn't good for.
- esmevane 15y agoLeena, http://www.google.com/search?sourceid=chrome&ie=UTF-8&q=leena+rao+disruptive+techcrunch http://www.google.com/search?sourceid=chrome&ie=UTF-8... As you can see, you have published numerous articles on this company with a blatant formula to your titling strategy. If I may offer some constructive criticism, I would recommend that you vary your language just a bit with the next Square article you post. Thanks :)
- jmm 15y agoDisruptive criticism? :)
- rawsyntax 15y agoI don't see this replacing cash registers. Think of places like the grocery store. Porting all that coupon / discount code?? Too much work
- RobMcCullough 15y agoGrocery stores in my area all seem to be going towards the DIY POS systems.
- kellyreid 15y agoI run a small retail biz and do a lot of trade shows. Square is the best thing to happen to my business since finding funding to start it. It's THAT good. I don't know if it's even on the table, but I agree with the article; there should be bids out for this company. I'm hoping that Dorsey et al do not sell it. I could see Visa buying them and doing something destructive - intentionally or not.