Is timing finally right for NFC?
Near Field Communication or NFC, is a short-range (high frequency) wireless communication technology which enables the exchange of data between devices around 10 centimeters of distance. The technology is a simple extension of the proximity-card standard (RFID) that combines the interface of a smartcard and a reader into a single device. A NFC device can communicate with both existing smartcards and readers, as well as with other NFC devices, and is thereby compatible with existing contactless infrastructure already in use for public transportation and payment. NFC is primarily aimed for usage in mobile phones [Wikipedia].
Mobile operators, banks and others have been carrying out a lot of experiments and pilots with this technology the last years without any signs of significant market adaptation. It has basically been a classical chicken and egg dilemma. Device manufacturers haven’t been willing to take the cost of incorporating NFC technology into mobile devices because of the lack of services utilizing the technology and potential service providers haven’t been able to launch services because people don’t have devices supporting the technology.
The mobile NFC usage which has been given the most attention is that of contactless payment and ticketing. Anyhow, the way I see it nothing will really happen until the device manufacturers decide to make NFC a standard phone feature. Nokia, Sagem and Samsung have launched a few handsets but basically it has been pretty quiet around NFC for some time.
Then, yesterday, Google CEO Eric Schmidt announced that Gingerbread, the upcoming update to Android that will roll out in the next few weeks, will include support for NFC. Schmidt demonstrated the NFC features on what seemed to be a Nexus S, meaning that this is a phone made to Google’s own specifications to show off the full specter of what Android is capable of. Let’s just hope the OEMs get the idea and jump on the NFC bandwagon… This time it looks like Google beat Apple to it, but rumours still state that the next iPhone will have NFC technology incorporated.
Today we could read that German operators T-Mobile, Vodafone and O2 are planning to introduce a mobile payment service as an extension to the current version of Mpass which is used for online payments only. The new service will allow customers to make payments in retail stores, via devices equipped with NFC.
As well as information that US mobile operators AT&T, T-Mobile USA and Verizon Wireless have banded together to build a national mobile commerce network called Isis, allowing users to make point of sale purchases using mobile phones and NFC technology.
With all this NFC news being announced at the same time everything points in the direction that NFC is ready to enter the stage to become an important ingredient for enhanced mobile services making mobile devices able to interact with physical objects in a way never seen before. The battle of control will be between operators, handset vendors or platform providers as to who controls the secure element. I guess Google and Apple won’t let that slip to the operators who want the secure element in the SIM. [Read more about the Single Wire Protocol interface]
Here are some additional thoughts on the matter from analyst Dean Bubley (@disruptivedean)
