If you have been using Apple’s (AAPL) latest iPhone to make payments, you would be happy to discover another use for the contactless payment system called Apple Pay.
Media reports say that Apple has tied with JetBlue (JBLU) to facilitate payments 30,000-35,000 feet in the air, or once the flight reaches cruising altitude.
JetBlue is buying its staff more than 3,500 iPad Minis along with special cases, which will be used to connect with iPhones carried by customers to make the payment. For now, Apple Pay will be a payment option on select flights only (NYC to LA or San Francisco) but be expanded to other JetBlue flights by June.
Customers will be able to buy food, drink and premium seats using their iPhones or the Apple Watch once it launches later this quarter.
JetBlue says it’s not partial to Apple; it expects to have Google’s (GOOGL) Wallet and other contactless payment options some time in the future. But let’s face it — Apple Pay does account for a large chunk of contactless payments (the company itself estimates $2 out of every $3). So it makes the most sense to start there.
Apple is justifiably proud of the coup and fully expects other airlines to follow suit: Eddy Cue, its VP of software and services, told the USA Today “somebody else doing it always puts pressure on the other guy.”
Contactless payment options are good news for consumers since they don’t need to carry cash or credit cards, thus increasing the security of transactions while reducing hassles (since the phone does all the work). There’s every possibility of speeding up the transaction, thus promoting impulse purchases, which is good news for sellers.
There’s little to do by way of purchases in-flight of course, but as users get more accustomed to the service in stores, coffee shops and the like, it’s something they will increasingly come to expect on airlines as well. So Apple’s deal with JetBlue, a first for any airline company, looks like a big deal.
Apple shares carry a Zacks Rank #2 (Buy). Other options in the technology sector include Intel Corp (INTC) and NVIDIA Corp (NVDA), both of which are also ranked #2.
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