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transactions using a smart card – such as Transport for London’s Oyster card – or through a mobile phone with a special chip. The best thing about NFC mobiles is the data transfer is two-way, meaning that it can receive data as well as send it, which is important for authentication and security. While the osaifu keitei (wallet phone)


is used by millions in Japan, we’re only just seeing NFC-enabled mobile phones in Europe. However, research company Frost & Sullivan predicts that by 2015 there will be 863 million mobile phones with NFC chips in them globally – 53 percent of the overall market. This means that over the next few years we are going to see a flurry of new contactless applications.


The mobile wallet NFC’s primary use will likely be payment. Just as you can do now with certain credit cards, you’ll be able to swipe your phone over a reader and have a payment deducted. NFC phones or smart cards can be linked to bank accounts, so money can be debited directly from a user. “So instead of setting off every morning with your mobile phone, wallet and keys, just your mobile and keys ought to do it,” says Russell Berry, Founder of AppCreatives.co.uk. While the first NFC-enabled phones were


launched by Nokia in 2006, mass adoption is yet to come. It will likely start with the newly launched Google Nexus S and the soon-to- launch iPhone 5.0. These and other similar smartphones will open the door to a new arena of mobile commerce, allowing users to carry cash and credit inside e-wallet applications. Currently NFC transactions in the UK are


limited to £15, eliminating the risk of large fraudulent transactions, but this limit could change with the introduction of further security measures. Beyond payment, NFC also has the potential to manage coupons, loyalty points and gift-voucher transactions.


Tap and go Applications are on the horizon that will allow you to check in at hotels or restaurants, and exchange contact details with someone, with a simple tap of a phone. Imagine meeting someone at a conference or bar and instead of rummaging around for a business card, simply tapping your phone against theirs to collect their contact details. Similarly, Nokia has launched a wireless speaker with embedded NFC so you can tap it with your phone and start streaming music on your mobile. Further down the line, we’ll see NFC


devices being used as key-fobs to unlock car and house doors. This has already been trialed


this is ensuring a particular app is running in order for you to authenticate a particular service. Perhaps you have an app for payment and a social app for sharing contact details. Both of these could even require a PIN to be entered or a fingerprint to be scanned in order for the transaction to take place. For Michael O’Hara, Chief Marketing Officer


for industry body the GSMA, SIM-based NFC wallets are more secure than regular wallets: “SIM-based NFC meets bank-grade security requirements, which makes them more secure than physical wallets, because they provide good security features, such as PIN numbers to access services, strong authentication


Apps will allow you to check in at hotels or restaurants with a simple tap of a phone


by the Clarion Hotel in Stockholm, Sweden. It replaced room keys with digital keys sent to guests’ NFC-enabled mobile phones and set them to expire after their stay. The technology can even be used to start a vehicle, as proven by chip manufacturer NXP, which created a motorcycle that could be unlocked and started using only a mobile phone. A US company is even planning to launch a range of tombstones that have a chip embedded in it containing biographical information about the person contained within the grave.


‘Tap to pay’ vs ‘tap to link’ While there are all sorts of tantalising NFC applications, there remain a series of challenges – not least overcoming any user fears about paying money to someone using their mobile, or sharing details. One way round


techniques to protect the mobile wallet (such as digital signature) as well as the operator’s ability to activate and deactivate services over the air.” A big advantage of NFC-embedded mobile


phones is you can streamline your experience, allowing you to store all of your tickets in one device. Imagine getting a train to the airport, boarding a flight, and using the subway at the other end by just tapping your phone on a reader. As Paul Morris, Director of NFC at chip manufacturer CSR explains: “A lot of the uses aren’t particularly extreme, but will enable a far more intuitive user experience than is currently possible. It will become another method of transaction in much the same way as the web, telephone and face-to-face already are.” n


OLIVIA SOLON is Associate Editor at Wired.co.uk


February/March 2012 businesslife.co 65 ➔


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