Will NFC become a killer technology

While contactless credit card is still a hot issue in the island-country of Singapore, several vendors in the region have started to buzz the concept of contactless mobile payment during a seminar last week.
The keyword is: NFC. The question is: Will it be a killer technology?

Near-Field Communication or NFC is a short-range 13.56 MHz wireless technology that can transfer data up to 424 kbits/s. Using standardized protocols developed by industry-sponsored NFC Forum, inter-device NFC communication is expected to establish two-way link and exchange data among different consumer products, such as mobile phones, televisions, personal computers and digital cameras. Touching and waving are the most common interaction styles that promise convenience as any other contactless technology. Nevertheless, the current usage of NFC technology is still limited to contactless card payment, contactless mobile payment and interactive smart poster.

Thian Yee Chua, the CEO of CASSIS, during a seminar in Singapore last week, emphasized the need to build an NFC ecosystem, an environment for consumer-service, for a wide adoption of NFC technology. Lim Boon Heong, the Marketing and Business Development Director in NFC business of INSIDE Contactless further detailed the importance of NFC handset availability, win-win business models and an open standard.

Contactless mobile payment is one of the applications highlighted during the seminar. Several pilots planned and initiated have involved major credit card companies, banks, merchants, mobile service providers, mobile network operators, such as: VISA, JCB, MasterCard, CCV Holland B.V, KPN, Nokia, PaySquare, Philips and ViVOtech, SK Telecom, Orange, France Telecom, China Fujian Mobile Communications Co. Ltd., Xiamen Branch and Xiamen E-Tong Card Company Ltd, 2-Eleven, Gemplus, CASSIS.

Yet, Bank of America that has conducted an NFC trial in collaboration with Venyon Oy and its 5000 employees at one of its corporate campus in Delaware reported in May 2007 that the NFC portion of the trial has flopped due to variety reasons, including undesirable mobile phone model and problems in downloading payment application to the handsets.

In addition, a security issue in the form of protocol vulnerabilities may become worse if NFC-enabled mobile phones can act as cards or terminals, can be programmed by their users and can communicate with each other (Anderson, Ross. RFID and the Middleman. Retrieved on 06-08-2007).