NFC & the War Against the Wallet

Andrew Froehlich, Network Engineer & IT Consultant | 1/18/2011 | 19 comments

Andrew Froehlich
The launch of the Nexus S phone made a big splash for multiple reasons. The Google-marketed and Samsung-manufactured handset was the first smartphone to operate the latest Android OS 2.3. Other impressive stats include front- and rear-facing cameras, a Cortex A8 1GHz processor, a 400x88 Super AMOLED display, and something called Near Field Communications (NFC).

Most of the hardware features of the Nexus S you can find in other smartphones such as the iPhone 4. But the NFC is something that is still fairly rare in most mobile devices. That will likely change very soon.

So what is Near Field Communications? Technically speaking, it is a wireless communications standard used to send and receive data at very short (4 inches or less) distances. It operates in the unlicensed ISM 13.56MHz wireless band.

The NFC chip found in smartphones such as the Nexus S can operate either in passive or active mode. In passive mode, information stored on the NFC device can be read later. That means that all kinds of information can be stored on the NFC chip and called upon to be used in a variety of situations. Just look inside your wallet or purse and look at all the cards that an NFC chip can replace. Personally speaking, I look forward to the day where I no longer have to carry:

  • Credit cards
  • Debit cards
  • Library card
  • Parking/bus pass
  • Building access card
  • Business cards
  • Secure-ID card (for two-factor authentication systems)

Come to think of it, maybe someday I won't need to carry my wallet at all.

Most people right now are discussing NFC purely from a credit-card replacement technology. While this is likely to happen, it's important to understand that NFC can be used for much more than a simple SpeedPass replacement. Using NFC as a card replacement tool is nice, but that's not where its true potential lies. Because NFC can work in active mode, your smartphone can not only send data, but receive data as well.

As more smartphones become equipped with NFC, you'll soon see many public places equipped with NFC information kiosks where you can download information such as maps, contacts, and other useful information with the click of a button. This information can be in multiple formats including text, images, audio, and video. NFC can be used to track people that "check-in" to NFC stations that are connected to a larger IP network. This form of RFID tagging is ideal for those situations where people are indoors, where GPS is rendered useless.

NFC will likely be heavily used for marketing as well. See an interesting ad while walking down the street? Just wave your NFC enabled smartphone in front of it and find more information about the product/service including the price and the closest place you can buy it in your vicinity.

There certainly are some security issues that arise from this wireless technology. All the traditional network-based security attacks will be possible to exploit, including eavesdropping, man-in-the middle attacks, and frequency jamming. But as with all technologies that change the way we as humans function, eventually those threats will be better understood, and the risk vs. reward will likely tip towards NFC use on a massive scale.

There is a high probability that the next smartphone you purchase will come standard with NFC. You may wish to try out NFC with a movie ticket purchase, at an information kiosk, or not at all. The decision is yours at this point. But the war against the wallet and purse is just beginning to heat up. I predict that five years from now, NFC (or similar technology) will render the wallet extinct.

View Comments: Newest First | Oldest First | Threaded View
Page 1 / 2   >   >>
catalyst   NFC & the War Against the Wallet   1/28/2011 1:56:04 AM
Display Spec
Not to be picky, but:

[...] a 400x88 Super AMOLED display [...]

That should be 480x800 or 800x480. FYI, there is a newer version called Super AMOLED Plus and is touted to have 50% more sub-pixels, which mean it will be sharper than the PenTile Matrix-based Super AMOLED.
David Wagner   NFC & the War Against the Wallet   1/20/2011 12:36:10 PM
Re: Will NFC make it to the big game?
Curt, I don't think it is figuring out how to get cash from your phone, but figuring out how to do it and still duck the IRS. I know lots of service workers and they all under report (and god bless them since they don't make enough). We'll need to start paying thse folks more if they have to report their real earnings.

I'm sure there are ways to use NFC or bump or whatever to tip a valet. I suspect there are...shall we say less accepted or perhaps more exotic...careers where tipping that way would be rather humorous. I think that is all I can say within the bounds of decorum.

I also worry about the homeless and the poor in a cash-free society. Will we hand out NFC-enabled cards to the homeless so we can give them donations?

But I think I've hijacked the thread. I'll stop there. Suffice it to say this is major step forward for those of us solidly in the center of "normal" society, but working out how "the rest of the folks" will handle it is a challenge. Hopefully, it will allow us to address those problems rather than simply ignore them.

 
CurtisFranklin   NFC & the War Against the Wallet   1/20/2011 9:59:29 AM
Re: Will NFC make it to the big game?
@David, I'm constantly amazed at how little cash I use in the course of the average month -- and I don't live in a large city. The last bastion of the "legitimate" cash economy in this country will be tips for service workers. When car parking valets and doormen figure out how to take electronic payments from your phone, then we'll start to see the beginning of the end for cash.
Terry Sweeney   NFC & the War Against the Wallet   1/19/2011 10:27:48 PM
Wireless retail, finally
Starbucks has unveiled an app for both iPhones and BlackBerrys that enables completely wireless payment for orders at the coffe-chain's locations. According to a report on NPR's Marketplace this morning, the new system is faster than a credit card and also enables the merchant (in this case, Starbucks) to get reimbursed faster than traditional credit card processing.

I expect lots of retailers will adopt some form of this in the coming 11.5 months.
David Wagner   NFC & the War Against the Wallet   1/19/2011 7:10:15 PM
Re: Will NFC make it to the big game?
I agree with all of your points, but I think they hinder the transition away from cash rather than make it impossible.

In the end, electronic money is going to be safer and more efficient than paper money. It is inevitable that we will eventually switch to it. Sadly, even though we could physically do it now, it probably won't be in my lifetime. But I do believe as an experiment, I could personally go a month without ever touching cash with little to no detriment.
Ivan Schneider   NFC & the War Against the Wallet   1/19/2011 7:01:37 PM
Re: Will NFC make it to the big game?
No way we're trashing cash. The black market economy is too big, and too critical to the above-board economy.  

Whenever dollars are printed and used to traffic in illegal drugs, conflict diamonds, enslaved humans, stolen artwork, puppies to be trained as fighting dogs or what have you, the government benefits from seigniorage -- dollars that are printed but will likely not be redeemed. That's an interest-free loan. 

Even if you back that out of the equation, the less pure among us will figure out some way to exchange value outside of official channels, whether it's denominated in a foreign currency or cigarettes. Cash is a more efficient store of value than cigarettes, therefore cash will remain in circulation. 

My 2 cents.

 
User Ranking: Blogger
David Wagner   NFC & the War Against the Wallet   1/19/2011 6:33:22 PM
Re: Will NFC make it to the big game?
Having your children punch the clock when they arrive at school? Man, I'm glad I don't have to go out and get my kid an octopus card.

On the other hand, I see Starbucks has just approved paying for coffee with your smart phone in all 7500 of their stores. One way or another, we're getting rid of money in this country and I'm really looking forward to it. 
Ivan Schneider   NFC & the War Against the Wallet   1/19/2011 4:29:45 PM
Re: Will NFC make it to the big game?
Welcome to the future ... the Octopus card in Hong Kong can be used for transit as well as building access and having your children punch the clock when they get to school.

http://www.octopus.com.hk/octopus-for-businesses/business-applications/other-uses/en/index.html

 
User Ranking: Blogger
CurtisFranklin   NFC & the War Against the Wallet   1/19/2011 3:51:47 PM
Re: Will NFC make it to the big game?
@Ivan, the Orca card example is great, and points out just one of the issues of shoving critical functions into unlicensed radio spectrum.

Here's a question: Do you see a day when the smart phone NFC capability might be used as a physical security ID card like so many of us carry? That way, you could just wave your phone at the security panel by the door and the blinky light would go green.

Even better, you could then use your phone as your log-in token for two-factor authentication to your enterprise computer. One device, lots of different functions. What do you think?
CurtisFranklin   NFC & the War Against the Wallet   1/19/2011 3:39:39 PM
Re: Security
You know, after credit cards, passports and such started carrying RFID chips we began seeing wallets with metal inserts to block portable RFID scanners from the information in our hip pockets or purses. It will be interesting to see if similar products are sold around near-field communications (or "personal area networks") to try to avoid electronic evesdropping.

As for the "lost it" scenario, I've already seen some devices that, when attached to your cell phone, start sending an alarm tone if you get more than 10 feet from the phone. I've walked out of a couple of restaurants having left my phone and have been fortunate enough to go back to find it in place. I don't want to have to depend on the kindness of strangers for my long-term data and personal information security...
Page 1 / 2   >   >>


The blogs and comments posted on EnterpriseEfficiency.com do not reflect the views of TechWeb, EnterpriseEfficiency.com, or its sponsors. EnterpriseEfficiency.com, TechWeb, and its sponsors do not assume responsibility for any comments, claims, or opinions made by authors and bloggers. They are no substitute for your own research and should not be relied upon for trading or any other purpose.

More Blogs from Andrew Froehlich
Andrew Froehlich   5/6/2014   13 comments
Not all clouds are equal. That's a pretty obvious statement that we can all agree on. Cloud service providers offer differing levels of services, redundancy, and customer service -- all at ...
Andrew Froehlich   4/30/2014   10 comments
In order for enterprise employees to work together as one unified group, they must follow carefully written policies and procedures -- but every once in a while, you may find yourself in ...
Andrew Froehlich   4/22/2014   49 comments
For those of us who study enterprise IT security, last year's Target store hack turned out to be a fantastic case study that was loaded with lessons to learn.
Andrew Froehlich   4/16/2014   22 comments
With news that Google slashed the price of their big-data offering "Big Query" by up to 85 percent, one has to wonder if the move is to ward off competitors -- or simply that the ...
Andrew Froehlich   3/18/2014   27 comments
At a recent South By Southwest Interactive conference in Austin, Edward Snowden said the NSA is "setting fire to the future of the Internet." In light of this, the World Wide Web ...
Latest Blogs
Larry Bonfante   4/9/2014   10 comments
When every capital expenditure is put under a microscope, it's harder than ever to continue to make the necessary investments in refreshing the technology our companies need to compete in ...
Brien Posey   3/4/2014   5 comments
Right now there seems to be a mild sense of anxiety among healthcare providers regarding the impending deadline to make the transition to ICD-10 coding. Not only are there operational ...
Michael Hugos   2/19/2014   21 comments
If you are a CIO who wants to ensure your place in the organization, a good place to start is with the CMO. That is because the CMO is most likely the C-suite executive under the most ...
Brian Moore   2/10/2014   56 comments
Ease of use matters when you are slaying dragons.
Brien Posey   1/7/2014   22 comments
If 2013 was the year of BYOD (bring-your-own-device), then 2014 could easily be the year of CYOD.
SPONSORED BY DELL AND MICROSOFT