Forget NFC: This Technology Will Change the Future

One of the biggest potential technological trends of the next decade was hardly noticed at this year's International Consumer Electronics Show in Las Vegas, though it was used in the official CES scavenger hunt.

Apple (NASDAQ: AAPL  ) announced the iBeacon late last year, and while it hasn't gotten much attention yet, you'll want to keep an eye on this Bluetooth-based technology as the market discovers its potential. In this video from the floor of CES, Motley Fool analysts Eric Bleeker and Rex Moore discuss iBeacon, and how it could kill near-field-communication (NFC) technology.

A full transcript follows the video.

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Rex Moore: OK, what about trends? That's what we like to look for as investors. What's the biggest trend you saw out here?

Eric Bleeker: The biggest trend? Remember when everyone was talking about NFC or QR codes?

Moore: Near Field Communication ...

Bleeker: Yeah, we go through all these things. NXP Semiconductor  (NASDAQ: NXPI  ) was a big company, people were based on this. NFC is so dead. It's just not going to happen; Apple never embraced it.

But the problem is, there's too much action taken from the user. If you have to bump phones for things ...

Moore: They actually used NFC in our badges this year, and it took a while -- like 5-10 seconds -- before you could get through the line.

Bleeker: Yeah. What I'm looking at now, I think Bluetooth is the real deal; a fundamental technology which will drive the entire technology sphere across the next 10 years. I talked with Steven Cheney, who is the biz dev head of a company named Estimote, and the kinds of things that he was talking about, that Bluetooth is enabling, is really wild.

I have some examples.

Beacons -- one of the newest products that Apple has is iBeacon. It's a Bluetooth-based technology, and it hasn't gotten a lot of press. They announced it, I believe, back in October, and some of the use cases for this were wild. You can set up a beacon -- it doesn't even need to be plugged into power, so it can be sitting on a wall for years.

Just as one example, they're extremely location-aware and talk to devices easily. A school district -- LA -- just gave away iPads to every student. A beacon could actually be used, that's location-aware. When students walk into the classroom it disables SnapChat so they can't use SnapChat in the classroom.

It is so passive, to be able to do these things, and the commercial cases ... we're just scratching the surface. I think the Internet of Things is real. I think Bluetooth is the key enabler, and of course I think a company like Qualcomm  (NASDAQ: QCOM  ) will do very well in this while other large companies such as Cisco  (NASDAQ: CSCO  ) claim to be at the forefront, but I believe are pretenders to the throne.

Moore: Why is Cisco a pretender?

Bleeker: Because they talk about being at the center of networking, but they just haven't been able to get in front of revenue opportunities. With a lot of more innovative uses of the technology, they actually endanger their own revenue, being a traditionally hardware-based vendor.

They just haven't been able to harness the trend as well as someone like Qualcomm, who is cellular in nature and owns the wireless standards instead of the equipment, being able to take care of your long-haul data in other areas.


Read/Post Comments (6) | Recommend This Article (3)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On January 24, 2014, at 9:13 AM, DonSharp007 wrote:

    Saying NFC is dead in an investment article really concerns me. While Apple has not yet adopted NFC it may well be in the next iphone iteration and be used in conjunction with beacons to transform the world of secure transactions. Apples fingerprint technology may also be used in tandem with these techs for ultra-secure tranactions. Information security is the #1 risk listed by most companies and whoever offers is quickest to offer a real time solution will be handsomely rewarded. Beacon tech by itself is not secure enough, however, when combined with NFC possibilities are huge. Note NFC may already be included in latest iphone iteration and simply require activation. This could be the success story of the decade, heck, even century. Whatever happens I just wish MF would do a little more research before putting out such artlcies. Check back in 4Q 2014 to see how they did!

  • Report this Comment On January 25, 2014, at 9:58 AM, obga18 wrote:

    david gardner likes nxpi, im so tired of motley fool writers pushing their own agendas...miss the days of quality articles on the fool. #housecleaning time david and tom.

  • Report this Comment On January 27, 2014, at 4:13 AM, hdbaumeister wrote:

    Comparing iBeacon and NFC as technologies that are very similar and suggesting that NFC will likely fail due to iBeacon shows you haven't understood the concepts behind the technologies that well.

    To put it in just a few words: NFC implies a willful commitment to transact. That bottle of water won't be yours if you don't tap the vending machine's antennae pad with your phone. iBeacon (Nomen est Omen) is a technology to interact with your phone (or other device) without your consent, as long as you "opt in" by installing and enabling the required software.

    These are two technologies are not competitors in any sense. If NFC fails, it will do so because the market doesn't want or need it, not because it is supplanted by iBeacon.

    Oh, and the 5-10 seconds it took to get into CES wasn't because of a shortcoming of NFC, since the tags are RFID tags. These can be read out in a fraction of a second; the 5-10 seconds delay probably were due to an overloaded backend system trying to match the badge id to a database.

  • Report this Comment On January 29, 2014, at 11:51 AM, rbgreer wrote:

    It was Motley Fool who pushed NFC heavily just over 1 year ago. I am curious if the voices of Motley really invested the money they said they were going to?

  • Report this Comment On February 13, 2014, at 1:58 PM, Hornvestor wrote:

    I keep getting newsletter promotions from Motley Fool on the emails I used to check out promotional articles before I took the plunge and signed up for Stock Advisor. One of these I keep getting, apparently a year later after it was first released, is on the NFC and the "death of credit cards."

    I don't mind the aggressive marketing, but it is concerning when you have Motley Fool writers trashing the very stock/new tech that was pumped and is still being pumped by Motley Fool. We need some consistency of message in order to get the value we are paying for in these newsletters.

  • Report this Comment On April 29, 2014, at 10:19 AM, Heidikitty wrote:

    We do not know if Apple is going to roll it out next thing for sure. I made over $3000.00 in a month investing in NXPI and still have it and watch it.

    I bought one stock and it went down quite a bit so I sold it. Should have listened to Motley Fool because guess what. It is up and running. I think we both need to concentrate on knowing when to buy and when to sell. Wish we could have that explained again. Good Luck and Happy investing.

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