iPhone users may soon be able to pay for purchases by merely getting within range of a reader. A new prediction from Envisioneering Group director Richard Doherty indicates such technology is coming in the next-generation version of the iPhone and the next-generation iPad, both of which are expected to debut this year.
The wireless technology is NFC, or Near Field Communication, and it may already be built into things you carry on a daily basis. Some credit cards come with an RFID chip that can be read at places like convenience stores and gas stations, which often have an NFC reader located just above the normal credit card reader. You can tap or wave your card near the reader and have your purchase amount deducted without having to swipe.
That's largely the extent of the NFC exposure we get here in the US, though other countries (particularly Japan) have been much more progressive in rolling out devices and phones with NFC built-in. If Apple were to implement NFC in the iPhone, it would likely work in the same way—your credit card information would be stored somewhere the phone can access it, and when you wave your phone near a reader (say a vending machine, or the checkout line), your purchase would be deducted instantly.
In addition to offering a handy way to pay for things, NFC in the iPhone could also give Apple an opportunity to offer even more targeted ads. As another analyst—Crone Consulting head Richard Crone—told Bloomberg, Apple could personalize its iAds to specific stores or products that Apple knows the customer already buys. Why does this matter? Ad rates (that is, those paid by the marketing companies) could skyrocket once they're more aware of the products that each customer is into.
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Doherty added that he believes Apple has already created a payment terminal prototype for small businesses that would be able to scan iPhones and iPads with NFC built-in. He says Apple is either heavily subsidizing the terminals or giving them away for free in order to get the tech off the ground.
Although this latest prediction comes courtesy of the not-always-reliable analyst community, the rumor that Apple has been working on incorporating NFC into the iPhone has been around for more than a year. For one, Apple has applied for a number of patents that involve NFC technology, though patents aren't always the best indicator of what will actually make it to market. However, Apple also hired an NFC expert as product manager for mobile commerce in August of last year, giving the speculation a bit more substance.
As a result, we would hardly be surprised to see NFC surface in an iOS device sometime in the future, though whether it'll come to both the iPhone and the iPad remains to be seen.
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