Nalini Muppala

Analysis, observations, perspectives on mobile space

Near Field Communication: We Need Innovative Use Cases (Part 4)

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People need an incentive to embrace a new technology. By far, the biggest hurdle to NFC adoption is the absence of a compelling service. NFC should be used to make interacting with technology intuitive and natural.

Every major player in the ecosystem is in the process of fine-tuning its business case for NFC. Transit ticketing and point-of-sale (POS) payment transactions are seen as the primary avenues of generating revenue, at least in the short term. Other use cases such as peer-to-peer content sharing and smart posters can add to the value of a NFC-enabled phone, but the burden of generating revenue rests with transit ticketing and point-of-sale payments for now.

Contactless payments have been around for a while, but have failed to grow beyond a niche segment of early adopters. In fact, most people don’t even realize they carry cards capable of contactless payments. Ticketing is prominent only in big cities. Therefore, for NFC to be successful in the United States, its use has to extend well beyond these obvious use cases.

Allure of NFC in Phones

NFC in mobile phones can tap into several other technologies in the device to enable compelling and enriching use cases. Mobile marketing can be fine tuned and well targeted based on location. Coupons and advertisements can be served based on usage patterns.

A contactless card is limited to making payments. A NFC-enabled phone can combine the phone’s processing power to deliver more value to the user. For example, it could help the user stay organized, keep tabs on spending, and so forth. NFC phones can thus act as more than payment devices.

In reader mode, NFC can enrich the user experience. For example, a self-guided museum tour can be much more interactive with smart tags intelligently placed around exhibits. In addition to smart tags, NFC in phones can use GPS and other technologies readily available for applications to offer compelling location-based services (LBS).

In peer-to-peer mode, the ability to exchange information between devices can lead to a lot of applications yet undreamed of. Alternatives exist, but the process can be much faster and easier with NFC. For example, LinkedIn users can exchange business cards using their phones. The phones use Bluetooth/WLAN to accomplish this task. Since a business card is just a few bytes, setting up a BT/WLAN connection is more work than the actual information exchange! With NFC, this process would be a snap.

Such intelligent use of the capabilities of phones will determine the fate of NFC.

Beyond Phones

The more devices made NFC capable, the better the utility of NFC in these devices. For example, if a user’s computer, digital camera and printer have NFC, transferring content from camera to computer or printing pictures directly from the camera could be done in a more natural manner.

Another example is the RFID-enabled BRAVIA LCD TVs, unveiled by Sony in March 2009 in Japan. Users could pay, say, for a movie rental by bringing any contactless payment card or a NFC phone close to the TV remote. This eases impulsive purchases and allows the user to choose the mode of payment that fits the situation and need.

Online merchants like to store payment information and reuse it to expedite the payment process during subsequent visits. Security breaches at several retailers have led to exposing sensitive financial information to prying eyes. Many users would rather re-enter their payment information each time than leaving it on some corporation’s servers. NFC would make such transactions securely and instantly.

For NFC to see widespread adoption, it needs to be deployed in a variety of devices such as consumer electronics.

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Written by Nalini Kumar Muppala

October 12, 2010 at 4:02 am

Posted in NFC

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