From a technological perspective, near field communications (NFC) is one of the most powerful and prominent innovations to come about in the last several years. But from a functional, real world standpoint, NFC is a technology without a clear-cut purpose. What problems does it actually solve? When it comes payments, how much different is a tap with your smartphone than a swipe of your debit card? What about the ability to open doors or share content with your friends? There are solutions already available on mobile devices for many of these “problems.” So, what is the real future for NFC?
NFC Growth Not Tied To Payments?
Those that read the ReadWriteWeb series on mobile payments know that I have never really been all that high on NFC. To me it is a curiosity that I keep track of because the technology is extremely interesting. The ability to tie a mobile wallet to a physical retail space through NFC has some disruptive opportunities and could be a game-changer in how money flows from one place to another.
“At the same time, it is hard to ignore that NFC is not yet a leading differentiator while customers shop for new phones (most are simply unaware),” wrote Cherian Abraham at Drop Labs today. “Solutions outside of payments that leverage NFC are still maturing (e.g. authentication, access control, discovery and media sharing to name a few).”
Abraham is right. Outside of payments, there is a significant development community working on NFC related material. One of the cheekier uses was announced today. Something called “Sound Pound,” which ” lets you share an audio greeting (a Sound Pound) with friends just by touching phones. It’s like a fist pound (or a high five) with sound!”
Honestly, I cannot tell if this is a step back or a step forward. It reminds me of some of the first popular iOS apps that did nothing but make fart noises.
Sequent on NFC “Myths”
Companies like Sequent, a NFC software maker, have a stake in seeing NFC rolled out to more than just payments. Sequent’s team shared some thoughts on what CEO Drew Weinstein believes are the “myths” about NFC.
Here are Sequent’s myths with my reaction to each.
The mobile wallet is important: “Google Wallet is the predominant storyline in the NFC dialogue, but NFC isn’t very interesting if it just serves to recreate a physical wallet on a phone. Digital wallets are simply one kind of mobile app, and NFC only becomes a dynamic technology when it goes beyond the wallet and is applied to all apps. NFC needs a more consumer-centric approach, one that offers people a variety of NFC-enabled apps that make their lives easier.”
- Reaction: I actually agree with this one. Mobile wallets at this point are some kind eclectic choice by some technological early adopters. I do not have a mobile wallet and do not expect to have one for some time, whether that revolves around NFC or some other technology. My experience is probably closer to the consumer experience than what Google, MasterCard and the banks would like you to believe.
Payment is the best use case to drive adoption of NFC technology on mobile devices:
NFC is really a technology solution looking for a problem: “Those same [banks and payment processors] parties have not been successful in defining the commercial and operational dynamics of mobile payments, due to friction with mobile network operators (like Verizon) and operating system owners (like Google). Merchants have also been slow to install the new payment terminals needed for NFC. This offers a huge opportunity for non-payment NFC use cases – such as ticketing (like movies or concerts), transit, access control, and tag-enabled advertising and promotion – to lead the NFC mobile consumer adoption curve.”
- Reaction: This is the top-down approach to NFC and mobile payments. Really, is user behavior going to change just because the large corporations of the world start brow beating people to use NFC? No. Adoption is going to have to start from the infrastructure layer, not the app layer and that means more use cases for NFC outside of the payment arena.
NFC is really a technology solution looking for a problem: “NFC solves a very real problem – enabling mobile apps to interact in the physical world. Technology is about removing friction, making things more intuitive and enriched. The ability to bring two NFC-enabled devices together to allow instant, secure and auditable data exchange is not trivial.”
- Reaction: While Sequent posits this as a myth, I actually agree with the statement. I do not think that payment delivery needs a fundamental overhaul. Nor do I think NFC is an absolute must-have technology that bridges the digital and physical worlds. It is the fringe benefit of technological growth, not a quintessential piece of a digitally connected world. As a professional early adopter, I will likely have NFC and use it in a variety of use cases. As a consumer, I am not sure I realized that NFC solved a problem until I have the solution actually in my hand.
Overall, NFC will likely be a common technology that is prominently used within the next three to five years. That has more to do with the fact that companies and payment processors will start to adopt it and push it on consumers than any real consumer groundswell in which users realize they absolutely must have NFC and have it right now.
Note: This story has been edited from its original version.