Samsung promoting the Galaxy S3's NFC feature. Source: Samsung.
When Samsung (NASDAQOTH: SSNLF) began aggressively marketing its then-new Galaxy S3 phone, one of the key features the company advertised in its "Next Big Thing" marketing campaign was a feature known as near-field communication, or NFC. Essentially, this feature allows devices to establish a network connection simply by putting devices within proximity to each other. While the feature mostly failed to gain traction in obvious applications such as mobile payments, the rumor mill is now buzzing with claims that Apple's (AAPL 1.68%) upcoming iPhone 6 will finally include it.
Mobile payments as the "next big thing"?
The concept of using smartphones for easier mobile payments isn't anything new, and indeed, Google Wallet, a mobile payment system developed by Google (GOOG 1.00%), has been around since 2011. This service not only allows users to store credit cards, gift cards, and the like, but it also allows payments to be made by tapping an NFC-capable phone at over 300,000 MasterCard (MA 3.59%) PayPass locations worldwide.
It's no secret that Apple is very interested in mobile payments, with Tim Cook plainly stating so on the company's first-quarter conference call:
The mobile payments area in general is one that we've been intrigued with, and that was one of the thoughts behind Touch ID. But we're not limiting ourselves just to that. So I don't have anything specific to announce today, but you can tell by looking at the demographics of our customers and the amount of commerce that goes through iOS devices versus the competition that it's a big opportunity on the platform.
So it's very likely that Apple will make a big mobile payments push with the introduction of the iPhone 6. Whether this will come simply in the form of getting app developers to make aggressive use of the recently announced Touch ID API in order to facilitate mobile payments, or whether it will also include NFC (which has distinct advantages over Bluetooth Low Energy such as lower power consumption, quicker connection establishment, and less interference because of the need for the devices to be in proximity) remains to be seen. However, according to VentureBeat, the iPhone 6 will indeed contain NFC, so that should be interesting to see this fall.
It's not just about hardware
If Apple does indeed include NFC in the next iPhone, many of those negative on Apple will probably claim that Apple is merely following the likes of Samsung. However, it's important to realize that if Apple does include NFC, it won't just design in an NFC chip and include a few toy applications -- it'll build around it the right ecosystem to make the feature not just "neat" (as it is on various Android devices) but indispensable.
How many phones or computers had fingerprint readers before Apple introduced Touch ID? Quite a few. How many of those implementations were as slick and as useful as the Touch ID found in the iPhone 5s? That's what I thought. Apple isn't about ticking the checkboxes; it's about making technology easy and fun for the average person to use. If Apple introduces NFC and a mobile payments system, you can bet your bottom dollar that it'll be a game changer.
