Touch and go

gallery

Every day, thousands of commuters use near field communications (NFC), although most may never realise it.

NFC is at the heart of London's Oyster card, is already built in to many Visa debit cards, and is being used to pay for small-value transactions from Spain to Hong Kong.

And recent developments, especially from the mobile phone manufacturers, are making NFC even more mainstream. Google Wallet, the BlackBerry Bold 9900 and the Google Nexus S all feature NFC. There are strong rumours that NFC might be built into the iPhone 5, when it comes out later this year. And NFC is set to be included into other devices, including tablets and even smart TVs. The market could be worth $670 billion - £420 billion – by 2015.

The technology behind NFC is not actually that new. But the way that developers, manufacturers, enterprises and, importantly, marketing executives is changing.

At its core, NFC is about contactless data transfer to and from devices. This has a number of applications. The most common is payment, using a phone as a debit or credit card by touching it to NFC readers at tills or pay points. But it has wider uses.

"We’ve been talking about payment and transit but that’s not the only thing NFC brings to the table,” says Charles Dachs, director of product management for mobile transactions at NXP, a developer of NFC technology.

Cashing in on cashless

“Essentially we talk about NFC in three ways: replacing the cards in your wallet, discovering content – using your phone as a content reader, and peer-to-peer – a device-to-device exchange of information.”

As an example, NFC could be used to link Bluetooth devices to peripherals like headsets. A phone could be synchronised to a headset just by physically “bumping” them together.

Certainly this kind of functionality would be very attractive for consumers, but businesses might need greater incentives to adopt NFC. Dachs believes this lies in the content reader and peer-to-peer elements of the technology.

“It’s about more than just using your phone as a card, it can provide a much richer experience with targeted marketing and direct marketing,” he says.

The most obvious marketing application is in digital coupons from purchases, or NFC readable posters. Vouchers would be redeemable on a consumer's phone.

According to Dachs, part of NFC's potential lies in making marketing methods more comfortable and less intrusive for the consumer and, in turn, making them more effective for businesses to deploy. No-one likes marketing emails and spam, but directly interacting with advertising in our daily lives might be more fruitful for both sides.

Another appeal for marketers is the low cost of deployment: “It doesn’t need to be point of sale. Contactless tags and stickers cost literally pennies,” says Dachs. Marketers could, he suggests, try mass deployments of interactive content in magazines and posters, and hope for a good return for a minimal investment.

NFC usage could also grow organically, with manufacturers such as RIM putting out NFC capable handsets and the relevant application programming interfaces (APIs) for developers. As NFC supports direct “bumping” of data between handsets, popular apps could spread "virally" between users. In turn, this could cement the appeal of NFC with marketers and developers.

More, though, needs to be done to make NFC a mainstream business tool.

Email to a friend

Print this page