With the issuance of digital ID, Apple adhering to taxpayers as part of the bill

With the issuance of digital ID, Apple adhering to taxpayers as part of the bill

According to a contract signed by four people, the company will maintain the system necessary for the state to issue credentials and service, hire a project manager to respond to Apple inquiries, tout new features prominently, and others. All taxpayers are required to promote recruitment with government agencies.

However, the move has raised questions from industry observers as to why local governments are transferring control of their citizens’ identities to $ 2.46 trillion in private sector. Beyond that, the integration of identities into powerful mobile devices has raised concerns from privacy experts about the risks of dystopian scenarios, including surveillance.

“Only discretion”
A seven-page memorandum of understanding obtained through a request for public records from CNBC and other sources shows that Apple has a high degree of control over the government agencies responsible for issuing identification cards. ..

Contracts between Apple, based in Cupertino, California, and states such as Georgia, Arizona, Kentucky, and Oklahoma give a glimpse into the deals of powerful companies. Apple is known for its obsession with secrets. Potential partners typically need to sign nondisclosure agreements to prevent publication of documents.

Story Highlights

  • Apple has made the US state part of the bill and is providing customer support for plans to turn the iPhone into a digital ID card, according to a confidential document obtained by CNBC.

  • Apple announced in June that users will soon be able to store state-issued ID cards in the Wallet app on the iPhone. This is billed as a safer and more convenient way for customers to provide their credentials in different settings. Combining this feature with Apple’s biometric security measures such as Face ID can reduce fraud.

Georgia and Arizona will be the first states to offer a driver’s license in the wallet app, but they haven’t started the program yet. The contracts obtained were virtually the same across states, but CNBC did not consider contracts for the other four states that signed up for Apple’s digital identity program: Connecticut, Iowa, Maryland, and Utah. bottom.

According to the document, Apple will provide important aspects of the program, such as the types of devices compatible with digital identities, how states are required to report work performance, and when the program will start. Has “single discretion” about. .. Apple can even review and approve the marketing that the state needs to do.

According to FinTech consultant and newsletter author Jason Micra, dynamics is similar to how Apple normally deals with vendors, but instead of receiving payment from Apple, the state is financially responsible for managing the program. You have to bear the burden. In an interview, Mikula said, “It’s kind of like a vendor relationship, and it doesn’t make sense to me because it monopolizes what it offers to Apple. Perhaps you can negotiate a much more equal deal. “. “I don’t know of any other examples of government-owned systems and identity credentials being made available for commercial purposes in this way.”

Apple declined to comment on this article. Representatives from Georgia, Arizona, Kentucky, and Oklahoma did not immediately respond to requests for comment. With the digitization of industries from finance to entertainment, the creation of more modern digital ID systems is being promoted around the world. However, according to Professor Phillip Phan of Johns Hopkins Carry Business School, efforts in countries such as Singapore, France, Germany and China are being carried out at the national level rather than at the private sector.