(ifoAppleStore) Within two weeks, Apple stores will begin retiring their current Windows CE-based portable computers and start using a custom-designed and crafted iPod touch to check out customers. AppleInsider has a first look at the new system.

Those who have seen the system for processing credit card, debit card and cash purchases, dubbed "EasyPay touch," said it combines iPod touch features with a magnetic stripe reader, advanced barcode scanner and Apple-written software to speed plastic and cash transactions.

Perhaps more significantly, the change to an iPod touch and Apple software will bring the entire point-of-sale (POS) system under Apple's control. In addition, the system will have the added benefit of advertising the usefulness of the iPod touch to customers who see it being used right in front of them.

It is unknown which manufacturer partnered with Apple to create the new device. The outside shell resembles many of the protective cases sold at the Apple stores, while the back of the shell resembles several of the auxiliary battery packs sold for the iPhone.

In April, AppleInsider first reported that Apple would replace its Pocket PC-based EasyPay devices with the iPod touch, thanks to new accessory support in the iPhone 3.0 software.

New system aims to improve

The current portable computers are made by Symbol Technologies Inc. and run Windows CE, linked to Apple's servers via Wi-Fi. They were introduced just before the holiday buying season in 2005, and allow any employee to act as a cashier, eliminating the traditional cash register positions that are common at other retailers. But the system has drawn complaints from employees about software crashes, sluggish operation and the need to frequently reboot.

Customers have also complained about Apple's check-out method, saying that it's confusing to make a purchase without a conspicuous, well-identified POS counter or waiting line.

Employees at the two just-opened Microsoft retail stores also use a portable POS computer made by Samsung, with an attached card reader and a separate barcode scanner. The Microsoft solution is about four times larger than an iPod touch and weighs five times as much.

Apple's new EasyPay touch system uses the touchscreen interface to access nearly every feature a salesperson would need to help a customer, including purchases with credit and debit cards, cash and making returns. There are numerous shortcuts available within the software, including pull-down menus and "flickable" lists.

Apple's solution consists of a hard plastic, two-piece slip-on shell with a grip texture. The magstripe reader is tucked onto the back of the shell, and the barcode scanner is installed within the top of the device. Hidden inside the shell is a rechargeable battery to power the card reader and scanner. A set of four tiny lights on the back indicate the unit's state of battery charge.

Buttons on the side of the device connect through to the iPod touch, including the sleep and volume controls. A mini-USB connector connects to an AC battery charger. A large squeeze-button on the right side momentarily activates the barcode scanner.

Checking out

The EasyPay touch will handle credit, debit and cash transactions, as well as certain product returns. But some other transactions will continue to be processed through the existing POS system, including using two or more credit/debit cards to pay for a single transaction, accepting bank or traveler's checks, and processing returns for cash.

Credit card transactions will be handled very similar to the current method. Customers will write their signature on the iPod touch using a Pogo Sketch stylus, which simulates the action of a finger, but allows finer entry and control.

Debit card transactions will be a hybrid of the EasyPay touch and the existing Hypercom desktop terminal. A customer's order will be entered and logged on the iPod touch. The customer will be directed to one of the store's existing Hypercom-brand credit card terminals, where they will swipe their card and enter their PIN. When the card is approved, a code is returned to the iPod touch for matching with the order.

For the first time, cash transactions can be accepted by any Apple store employee who has an iPod touch. After entering all the products and totaling the cost, the employee presses an on-screen "Cash" button to electronically open one of several cash drawers installed around the store. According to tipsters, this feature will be rolled out only at selected stores over the next six months.

Customers will continue to have the option to receive a printed or e-mailed receipt, or both.

For product returns, the original purchase can be located by scanning the barcode of the purchase receipt. Without a receipt, EasyPay can search for the purchase by the customer's e-mail address, product serial number, or the credit/debit card number. The device captures why the return is being made, and will then generate a credit to the customer's account, along with a printed or e-mailed receipt.

iPhone purchasing streamlined

Purchasing an iPhone is said to be greatly simplified with the new EasyPay system. The iPod touch scanner can detect and capture all four barcodes that are printed on the iPhone box, and will automatically fill in the appropriate data fields on the order screen.

iPhone-specific screens will collect the customer's identification, and if they are a new or existing AT&T customer. The Apple store employee can enter the customer's choice of phone plan, indicate if they qualify for a reduced price on the iPhone and if the customer is porting their current telephone number to the iPhone. Various other plan options can also be selected, including the text message add-ons. The software even displays the iPhone "Terms and Conditions" for the customer to read, and then accepts the customer's signature to verify their acceptance.