Near Field Communications Gets Closer for CEBP
With the announcement of Google Wallet, the cell phone based mobile payment system, the interest in near field communications (NFC) is starting to mount. Of course the only NFC-capable phone we have in the US today is the Google Nexus S, but RIM has announced its intention to include NFC in the next generation Bold 9900 due out over the summer, and Nokia plans to include NFC capability in all of its handsets. If this catches on (and I think it will) we can expect Apple, Motorola, Samsung, HTC, LG, and the rest to follow. The thing to recognize is that there’s a lot more to NFC than just mobile payments and this capability promises to add a whole raft of new functionality to our smartphones.
NFC is a type of radio frequency identification (RFID) technology that can allow data exchanges from powered or unpowered devices at very close range (up to 4 cm). The basic set up calls for an initiator and a target. The initiator generates a radio frequency field, and when the target is within range, it can exchange data at rates from 106 K to 848 Kbps. If the target has a power source, it can also act as an initiator. Besides reading data from the target or “tag,” the initiator can also write to it, though most consumer tags today are read only; current tags have between 96 and 512 bytes of memory.
The reason for the details is to illustrate what this type of technology could be capable of. In short, it’s not a replacement for the Bluetooth interface in your phone that support data rates up to a couple of million bits a second over a range of 10 m (farther with Class 1 Bluetooth). NFC is not something that can be used to send massive amounts of information or operate over extended distances, but there are some incredible things it will be able to do.
The application that is kicking this off is mobile payments, and Google has partnered with Citi, MasterCard, First Data (a major credit card processor), and Sprint as well as a number of merchants who will accept NFC payments. There has been some discussion of the security exposure, however they do seem to have covered the basics. The device will not authorize a payment unless you enter a PIN; if you lock the phone, a thief wouldn’t even get that far. Also if you get the PIN wrong too many times, you have to go through a reset process. Further, the short transmission range means that a crook would have to get pretty close to be able to monitor the exchange.
The important thing is that even if people don’t start paying for things with their cell phones, having NFC capability in the phone opens the door to countless other applications and communications enabled business processes. Here are some of the options under discussion.
Smart posters: NFC-enabled phones can be used to read RFID tags on signs or product displays; we’ll need some kind of logo to know it’s available, but I’m sure the marketing guys are onto that. The information provided could take the phone’s browser to a web site that provided additional information, coupons, or promotions. If it’s a movie poster, maybe you get the trailer.
Mobile ticketing: Rather than paper tickets, your phone could be your ticket; we’re already getting mobile boarding passes. This one is almost a no-brainer when you look at the RFID-based automatic toll collection systems that have sprung up over the last decade. Also unlike paper tickets, you’re not going to forget your cell phone at home.
Bluetooth pairing: NFC could also help pairing of Bluetooth 2.1 by simply bringing them close together and accepting a pairing request. I’ve been putting off buying a new car based on the trial and error process I went through with this one trying to pair the Bluetooth to my cell phone.
Electronic keys: NFC-enabled phones can serve as replacements for physical car keys, house, or office keys. Taking this a step further, NFC-enabled devices could be used by hotels and rental car companies (do you know how much it costs if you lose the keys to your rental car?).
Electronic ID Cards: On a similar note, NFC-capable phones could also replace employee ID cards for card entry systems.
Public information access: Rather than the impossible-to-read descriptions you find at museums or public monuments, how about letting your phone link you to web sites, pictures, videos, or other resources that provide far more detailed and extensible information sources. That content would be too voluminous to transfer over NFC, but NFC could make access to that information seamless.
NFC Business Cards: Rather than exchanging business cards, you could tap phones with someone to exchange that information. At their recent partner conference, NEC had a system from a company called
Minglestick that let you exchange contact information by pointing these little gadgets at one another and pressing a button. NFC could make that capability ubiquitous.
As you can see, many of the applications being discussed fall in the B2C category, but the potential range of applications is truly open ended. Given the indispensible nature of mobile phones, adding a means of identifying yourself or picking up information with a mere touch holds enormous promise. The technology has been around for a while, but with growing support from the mobile industry, I expect we will see this available on better than half of the mobile devices in people’s hands within three years (based on availability and assuming the typical two-year cellular contract).
Importantly, NFC appears to be one of those technologies that was cubby-holed for a single application (i.e. mobile payments), but there can be a whole world of possibilities growing out of this.