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Is Apple Developing an Access Control Category Killer?

The future of access control technology boils down to a question: who will control the device that controls the lock? Our physical spaces are becoming increasingly controlled by our digital devices as they become more central to our daily lives. The question might have been answered when the maker of the world’s most popular personal devices announced plans to launch digital identification, paving the way to use your Apple device to access hotels, homes, and offices. Already partners with government agencies, hotels, and the hardware manufacturer Latch, Apple has established itself as the key player in access control overnight.  

At this year’s Worldwide Developer Conference, Apple revealed updates to its Apple Wallet service, showing how your Apple device will be able to store driver’s licenses, state IDs, and other credentials in its encrypted enclave. Apple has already worked deals with the TSA and several states to store airline credentials and official government IDs. BMW is working with Apple on the automaker’s first digital car keys. Apple plans to test the access control technology at 1,000 Hyatt properties, with plans to add the ability to unlock homes and offices. Better yet, Apple’s expanded offerings in iOS 15 use ultra-wideband technology so users don’t even have to take their device out of their pocket to get access. 

“With the Apple Wallet app, we set out to replace your physical wallet,” Jennifer Bailey, VP of internet services and Apple Pay at Apple told the audience at WWDC. In addition to storing payment details, Apple Wallet can already store transit cards, even Disney Park passes. “You can never leave home without your keys, so we’re continuing to add keys to Wallet, making it even better,” Bailey said, adding, “with iOS 15 we’re bringing keys to your everyday places to Wallet, starting with where you live. We’re creating the fastest, most secure way to unlock your house, apartment, or flat. Where you work, just add your corporate badge, and tap to enter your building or office. ”  

Access control has grown by leaps and bounds during the pandemic as facility managers look for more efficient, secure, and hands-off ways to let people through doors. Now, the makers of the apps, devices, and fixtures fighting to be the platform for physical access could be up for a rude awakening. The world’s most profitable company is moving in on access control with the same speed and execution that it did with personal computers and cell phones. Apple could take a growing, disjointed industry and unify it with iOS and Apple devices at the center. Apple’s plans may sound ambitious, but most of the company’s products are designed to be transformative. Apple uses its technology to evolve daily life. Judging by Apple’s success, you might not get good odds if you decide to bet against them. Apple devices will be an unprecedented place in access control: key master. 

Apple’s partnership with Latch is critical. Described as the Apple of Real Estate, Latch raised $453 million when the company went public through a SPAC offering earlier this year, valuing the smart-lock start-up at over $1.5 billion. Latch looks to combine beautiful design, exceptional functionality, and gorgeous hardware, which is not all that different from Apple’s own business strategy. Latch’s investment prospectus claims there are 47 million rental homes across the United States with tens of millions more offices, all ripe for disruption. “When we started Latch, we focused on digitizing keys and making access super simple. While others also realized that keys were going to be replaced by digital credentials, what we saw was different,” said Latch Co-Founder and CEO Luke Schoenfelder. “The broader opportunity has always been to create the first scaled identity platform for the physical world, one that works for every Latch-enabled user, space, and device.”

Landlords love investing in technology that streamlined operations and reduces costs. Digital access control has the potential to do both. But, implementation has proven to be the hardest part. An Ernst & Young report found 58 percent of respondents blamed implementation as the biggest difficulty to integrating technology solutions in their buildings. Fears of onboarding a new system might be overcome when considering partnering with Apple, a company known for simple, easy-to-use products and seamless customer services. 

Apple appears to be creating the first scaled platform that Schoenfelder mentions. While Latch’s investment presentation talks about the size of the American market, Apple’s aspirations are likely far bigger. Partnering with Apple, a company with a powerful global reach, Latch has the opportunity to reach broader opportunities. That doesn’t come without complications. Latch isn’t the only horse in Apple’s stable. Apple is also working with Schlage and Assa Abloy, well-established hardware and lock manufacturers. 

That’s what puts Apple in such a unique position. By controlling the identification piece of the access control puzzle through their device log-in (be it passcode or face identification), it can easily establish itself as the de facto key master. That will force company’s that control locks to come to the table. Apple already has an insurmountable lead over every company in the access control space. The company estimates there are 1.65 billion Apple devices currently in use. In 2020, Apple sold its 2 billionth iPhone. Years after the passing of Steve Jobs, sales and usage are at an all-time high. Android devices may be more common in many areas, but the market is segmented by multiple manufacturers. Google doesn’t control Android devices the same way Apple does. While Google does make its own hardware, they are just a portion of total Android devices. Apple’s ability to vertically integrate hardware, software, and services into one established and trusted brand gives the company a competitive edge that will be nearly impossible to overcome.  

Security also gives Apple a key advantage in the access control space. Digitizing security credentials offers new avenues of attack for would-be hackers and bad actors, giving pause to users who have security concerns. Apple sets the standard for encryption. Whether end-to-end or encrypted in the cloud, Apple’s security measures are some of the most trusted in the world of technology. Consumer trust in Apple’s security and encryption could prove a deciding factor for landlords when considering which tech company to turn over the digital keys to. 

Apple’s push into access control is only just getting started. How each partnership with government agencies, hardware manufacturers, and property owners will look will be something to keep an eye on. Critics are already concerned with the legal implications of digital IDs. There are major questions around presenting an unlocked device to law enforcement for ID verification, potentially exposing sensitive information authorities may not have authority to view. There are clearly many details that need to be worked out. 

One thing is certain, building owners need to be paying attention to what Apple is doing, access control technology vendors should be studying it. Apple will continue to think about how they are able to alter our daily lives. For now, it looks like they are planning to do that by not only replacing our wallets but our keys as well.

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