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RFID Forum at MIT Discusses the Future of NFC

The MIT Enterprise Forum of Cambridge's RFID Special Interest Group held a forum Tuesday on NFC entitled . The three-hour event included four presentations covering a range of topics, then closed with a lively question Q&A session.
Sep 19, 2007This article was originally published by RFID Update.

September 19, 2007—The RFID Special Interest Group of The MIT Enterprise Forum of Cambridge, in conjunction with this week's industry event RFID World: Boston, held a forum about NFC technology Tuesday evening at MIT. Entitled The Near Field RFID Revolution for Your Phone, the three-hour event included four presentations covering a range of topics about the emerging technology, then closed with a lively Q&A session.

Recall that NFC, or near field communication, is the contactless technology based on RFID that proponents hope will enable a wide array of mobile commerce services for cell phones, such as contactless payment and ticketing, interaction with "smart posters" from which consumers can download media and buy tickets, and access control.

One of the themes that was repeated over and over was the complexity of the NFC ecosystem, which includes an uncommon variety of stakeholders: phone manufacturers, network operators, card issuers, public transportation companies, contactless transportation ticketing providers, payment processors, media vendors, and merchants and retailers, among others. Commercial NFC transactions will involve a number of these stakeholders, each of whom is currently vying to ensure that it gets as big a cut as possible. While the number of NFC transactions worldwide today is still relatively low, most technology watchers agree that the volume in just a few years could be immense, when NFC is ubiquitous and used for everything from transportation ticketing to contactless payment to access control to peer-to-peer media sharing. The negotiations occurring today will determine which stakeholders benefit most from NFC's ubiquity tomorrow.

There are considerations other than money, such as support and client relationship responsibilities, as well as determining which players will have access to NFC customer data. Financial companies, as an example, are notoriously possessive of customer and transaction data.

"Who owns the relationship? Who owns the data?" Charles Walton, global executive vice president of INSIDE Contactless asked rhetorically. "These questions make working everything out very complex."

Thus, demonstrating clear benefit from participation in the NFC ecosystem to every stakeholder remains the number one challenge to more aggressive deployment and adoption.

That aside, there are many signs of progress. The promise of NFC -- the "e-walletization" of the cell phone -- will likely be an easy sell to consumers, who have already demonstrated a fondness for contactless payment in the US and other regions where it has recently proliferated. Walton even thought NFC could show an "iPod effect", in which a herd mentality develops among consumers, who rush to buy NFC-enabled cell phones as a must-have gadget.

The forum presenters also mentioned the possibility of a "killer app" that could suddenly ignite NFC adoption. Tony Sabetti of RFID hardware manufacturer Sirit believed NFC adoption would happen one of two ways: either a killer app will emerge, or a gradual build-out of contactless transaction infrastructure will yield equally gradual adoption by consumers eager to take advantage of the cashless convenience.

Despite occasional disagreements and differing visions, there was a clear subtext during the entire event: the question of NFC's adoption is one of if, not when. It's a question that those in the RFID industry will likely be familiar with.
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