I’ve lost count how many (hardly-working, rickety) demos I’ve seen on how NFC is going to change commerce and payments as we know it.
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The problem with NFC, of course, is that it is a solution looking for a problem.
It’s going to solve every possible payment problem in the world. Yet, when rolled out on an industrial scale — as is the case on London’s Underground — the issues with the technology become patently obvious. Bank cards in the same wallet as (the Tube’s) Oyster cards being charged for journeys, two or more cards being charged… But teething issues are expected in what’s turned out to be one of the world’s biggest rollouts of NFC tech (there are twice as many Oyster cards in the UK as contactless Visa cards!).
And what of mobile NFC? The head of business development at Transport for London, Matthew Hudson, hasn’t minced his words: “there are too many stakeholders — with banks, retailers, mobile network operators, device manufacturers and advertisers all fighting for a share of the revenues.”
And don’t tell me physical retail is dead. In many ways, its booming. But, it’s becoming experiential. It’s no longer about stacking ’em high and cheap. Yes, that model might not exist in a decade or two, but being able to touch and experience a product isn’t going away just yet.
Beyond payments, NFC is also seen as a solution to ‘location-awareness’, especially indoors. Google’s had few other options but to embrace NFC. Android Beam — which allows the transfer of data wirelessly between devices – is perhaps the most obvious of Google’s implementation of the technology. But again, the technology isn’t seamless. Like with payments, it doesn’t just work.
So if mobile NFC isn’t the obvious or immediate answer, what is?
Understandably, there’s tons of excitement around Apple’s iBeacon (which uses Bluetooth low energy).
With the potential for 250-million iOS devices to be capable of being iBeacons after this holiday season, that excitement is understandable. Every device since the iPhone 4S and the third-generation iPad is capable of being either an iBeacon receiver or transmitter. That’s a massive installed base.
Apple itself has quietly rolled out (and turned on) iBeacons at its 250+ US-based stores. In some larger stores, there could be as many as 20 iBeacons. Together with an updated Apple Store app (which supports iBeacon-based location services), the possibilities are intriguing.
Apple can now push ‘micro-notifications’ depending on location within the store. Walking past an iPad display, for example, could trigger an iPad-specific notification.
Of crucial importance, is that this technology that isn’t complicated to set up, or even necessary to understand. We all understand how notifications work. This requires a simple opt-in.
It’s obvious – with limited functionality added to the Apple Store app – that this is the beginning and not the end for iBeacon. Apple’s defining an entry point for other retailers so that future rollouts of this technology aren’t shots in the dark. It’s also enabling a very useful live test environment for iBeacon.
Already, we’re seeing companies dabble with the technology. Like offering subscriptions to digital publications depending on proximity. This completely changes the retail experience.
What about a combination of iBeacon and Touch ID (which hasn’t even been raised yet in the tech press)? Location + identity. That would be a true payment disruption.
The danger of course is that we’re now stuck with a proprietary technology, and while that no doubt suits Apple, it surely isn’t the answer for application worldwide.
Will that make a difference? What will it mean for customers who use Android devices at retailers who’ve rolled out iBeacon? Do retailers roll out iBeacon and something similar for Android customers? Or do they simply ignore mobile NFC and enable contactless card payments as a matter-of-course with their banks/credit card acquirer?
Or does iBeacon fade into the background like iAd, or — worse — Ping?