Kick-starting another market
A report from Bloomberg appears to confirm that Apple is planning to introduce Near-Field Communications (NFC) technology to the iPhone and iPad. The headline use for NFC in mobile devices is to allow them to perform secure electronic interactions by merely placing them near a terminal.
Given that Google made NFC support a key feature of Android 2.3, and Apple partner ARM has been putting a lot of effort into its ‘click and PIN' and smartcard technologies, it doesn't come as a great surprise to see Apple focusing on this technology. The most noteworthy thing about this development is what it could mean for the whole mobile payment market.
From the many conversations we've had with industry insiders interested in the development of mobile payment, much of the technology is already readily available - just look at the Oyster system on the London Underground. The issue lies with the Catch 22 situation of financial services providers not wanting to invest in it unless there is end-user demand, and that demand being inhibited by the lack of infrastructure.
Apple has a unique record in the past decade for creating demand. MP3-players had been around for a while before the iPod, as had smartphones and tablets before the iPhone and iPad respectively, but apple transformed those markets. Furthermore Apple has created two massive e-commerce platforms from scratch: iTunes and the App Store.
If anyone is going to kick-start the era of people using their mobile phones to pay for stuff directly it's Apple. Because of its closed, controlled ecosystem, as well as established e-commerce platforms, it should be able to demonstrate mobile payment in the field before Android. Once it does this, there's a good chance that financial service providers, retailers and developers will jump on board.
While these same organisations would doubtless support mobile payment technologies offered on Android handsets, as well as other mobile OSs, such as Microsoft's WP7, it could take a push by Apple for this technology to achieve critical momentum.
