U.S. Cellular Phone Provider Tests NFC

By Mary Catherine O'Connor

June 26, 2007—Cellular South, a privately held wireless telephone service provider in Jackson, Miss., has launched a summer-long technology trial. Throughout the pilot, 75 customers are making purchases at participating merchant locations in Jackson and Memphis, Tenn., using cell phones containing high-frequency (13.56 MHz) RFID modules compliant with the near-field communication (NFC) specification.

NFC technology is designed to enable consumers to purchase goods, download information and establish device-to-device communications using cell phones and other mobile electronic devices. The NFC Forum, founded by Nokia, Philips and Sony to promote the technology's adoption, is working to standardize NFC protocols. At the same time, a number of wireless providers and handset manufacturers have been deploying technology trials in the United States and Europe (see NFC Scores High in Atlanta, MasterCard and 7-Eleven Launch NFC Trial and French NFC Payment Trial Kicks Off).

San Diego, Calif.-based handset manufacturer Kyocera Wireless is providing the handsets used in the Cellular South trial. The NFC-enable prototype phones are the first to include a biometric authentication function, says Dave Carey, Kyocera's vice president of strategic planning.

According to Carey, users have the option of utilizing either the phone's integrated fingerprint scanner or a personal identification number to authenticate themselves before making a purchase via phone. The fingerprint scanner—which can double as a scroll bar for navigating the phone's functions—was added to the NFC prototype phone, he says, because "consumers are more concerned with the security of NFC phones for making payments than anything else."

Using the fingerprint authentication function prevents anyone other than the phone's owner from using it to complete an NFC transaction. Carey says Kyocera is also involved in two other NFC pilots involving different handsets, about which he declines to provide details. Kyocera will consider consumer feedback from all three pilots, he adds, before making any plans to include NFC capabilities in future phone models.

Seventy-five Cellular South customers are currently using Kyocera NFC-enabled phones to make purchases at a total of nearly 50 merchant locations in Memphis and Jackson. Six Memphis merchants are participating, including the Memphis Zoo, as well as eight in Jackson—McDonalds and CVS Pharmacy among them.

These merchants have added RFID-enabled payment terminals made by ViVOtech to their existing point-of-sale systems. Cellular Wireless programmed the phones to enable testers to spend up to $100 over the course of the trial, by creating MasterCard credit card accounts for each tester and linking each account, with a $100 spending limit, to Wireless Wallet, a Cellular South payment application running on each phone.