Sep 15, 2014Perhaps it didn't make the biggest splash at the Sept. 9 introduction of Apple's iPhone 6 and iPhone 6+, and Apple Watch, but the addition of Near-Field Communication (NFC) to all three products is a big deal. It's big not just for the RFID industry, but for marketers, retailers and others.
NFC, for those of you who don't know, is a form of passive high-frequency (HF) radio frequency identification. It's been used in many Android phones for several years. There were rumors that the iPhone 5 and iPhone 5S would have it, but that didn't happen.
Apple never introduces technology. It introduces whole products or applications (a lesson for RFID companies). My belief, this time last year, was that Apple was trying to work out deals with banks and credit card companies so the NFC technology could be used broadly for payments when it was introduced.
Sure enough, Apple announced not just the addition of NFC in the iPhone 6 but also a new digital wallet—dubbed ApplePay. The wallet can be accessed securely using the fingerprint-recognition technology introduced in the iPhone 5S, to ensure that no one can find your phone and go on a spending spree.
Apple also announced that it has partnered with American Express, MasterCard and Visa, along with several banks that issue those cards, to allow iPhone users to store their credit card accounts in ApplePay. That means if you have one of those cards from one of the issuing banks, you will be able to use ApplePay at some 220,000 merchant locations in the United States that already take mobile payments via NFC.
The Google Wallet was a flop, largely because the agreements weren't in place to make it useable at a lot of locations. Apple is not making the same mistake. It has teamed with several retailers—including Macy's, Walgreens, Duane Reade, Staples, Subway and McDonald's—to ensure they accept ApplePay. McDonald's plans to accept ApplePay at its drive-through lanes.
It's not just the phone. Apple Watch also appears to have an NFC transponder in it. Tim Cook, Apple's CEO, said during the introduction that Apple Watch "has everything you need to pay with ApplePay."
The addition of NFC to the iPhone is certainly going to drive the acceptance of contactless (read RFID) payments. More retailers around the world will add NFC terminals at the point of sale. Given the ubiquity of smartphones—my 90-year-old mother-in-law has one—and the security features that can be built into your phone, such as the fingerprint recognition Apple is using, it is possible that credit cards could become obsolete.
The addition of NFC technology to the iPhone means retailers are going to need to embrace the technology at the point of sale. But it also creates some new opportunities for any company doing consumer marketing or providing consumer services. If you are a museum, for example, you can put NFC tags near displays and enable visitors to download short audio recordings, videos or other material about each piece in your collection. If you are a restaurant, you can allow people to read NFC tags at their tables and place orders via their phones, so waiters don't need to visit each table.
It will also be interesting to see if app developers employ NFC to create new apps or enhance old ones. But no matter what happens, NFC technology has just received a big boost.
Mark Roberti is the founder and editor of RFID Journal. If you would like to comment on this article, click on the link below. To read more of Mark's opinions, visit the RFID Journal Blog, the Editor's Note archive or RFID Connect.