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The real cost of Apple’s Passbook

Over the course of the next week, until the new iPhone 5 actually ships, people will analyse the device to death, reporting on whether it is as good as expected, and whether it is worth buying.

The conversation will be unavoidable and will obsessively deconstruct the specific features of the phone. When all is said and done, Steve Jobs will be sorely missed as the chief tub-thumper. We'll all wonder how long this carnival can continue.

The feature I'll be following closely is the electronic wallet because I've earmarked it for nearly 20 years as the chief evil of smartphones. The e-wallet – or maybe e-purse might be a better moniker? – is the future of these phones.

Previously, I’ve expressed my fears about how mobile operators will own you like a slave if mobile payment eventually heads in the obvious direction – and you end up running your tab through them (if you think the banks are gougers, wait until you’re threatened with having your mobile service cut off if you don’t settle the bills).

Now, Passbook only heightens my concern. Passbook is a virtual wallet that does much more than pay bills. Your phone will pay for your groceries and anything else you want to purchase. It will also cache all your coupons and stored rewards from your shopper loyalty cards. Not to mention the fact that it'll provide you with in-store deals.

Eventually, this "phone" will contain your medical records, passport, and driver's license. You can count on it.

Now, all this comes at a price. Fees will be tacked onto everything because the service provided is so convenient. This is standard practice when it comes to customer relations nowadays. The first question asked in company meetings is: "How can we gouge our customers more?"

So here comes Passbook – and if it isn't Passbook, it will be Google Wallet or some other system. I assure you it will be something.

Here is how it will work: You'll go to a big, soulless store. Your phone will have a built-in store rewards card for savings on many products. On this visit, you'll save £10 just by using it. Earlier in the week, you got a bunch of coupons in the newspaper and by email. You snapped a picture of them using your phone's camera, embedding them into the phone. When you check out at the register, these will automatically be subtracted from the bill. You just saved another £10. And you did this without clipping a single coupon.

Within a year of this feature establishing itself, dot-com businesses will emerge. They will download all the coupons in the world to your phone for a fee. Think of the savings!

This model will look as if it makes up for the onerous fees required to even use the payment system, not to mention the 18 per cent interest rate on the credit card, the questionable bank fees, the aggravating bank errors, and so on. In actuality, the joke is that all those savings are really just discounts on products marked up too much in the first place. It's a complex scam. But think of the savings!

One day, you will lose your phone. Now come the real savings – savings for the person who finds your phone and goes on a shopping spree before you can get the bank to kill the phone's payment system, that is.

I do not see any of this as progress.