There’s a lot of talk about NFC this week, with Apple expected to include a near field communication chip in the iPhone 6. Apple has also reportedly signed deals with Visa, MasterCard, American Express and other payment companies to enable a new mobile wallet feature on its new iPhones.
NFC specifies a set of radio frequencies used by two devices in close physical proximity -- such as a phone and a compatible payment terminal -- to exchange files and data. VentureBeat reported two months ago that an NFC chip will be included in the iPhone 6, which will make its first appearance at a Sept. 9 launch event. Other sources have reported that the chips will be made by NXP.
Retailers Are Waiting
We reached to Canalys analyst Daniel Matte, who told us at this point there’s no reason to think that the new iPhone won’t include the NFC chip -- and that it won’t be embraced by retailers.
"A lot of payment companies are letting retailers know that they’ll be held liable if they’re not using some sort of chip technology to process transactions," Matte says. "The presence of the NFC chip gives them a good reason to make that transition."
The use of the NFC chip could be especially lucrative for Apple, which has 800 million iTunes accounts linked to credit cards to drive mobile payments. Analysts figure that retailers will fall into line to adopt compatible technology once NFC chips have become fixtures in smartphones.
Even with all the discussion about the impending death of swipe-and-sign payments, mobile payments aren’t all the NFC chip is set to do in the iPhone 6. VentureBeat.com reported that NFC chips have three modes: card emulation for payments and ticketing, peer-to-peer and reader/writer.
Peer-to-peer mode lets one device pair quickly with another to exchange files or data via NFC or by Bluetooth low energy wireless technology, which the iPhone 6 also supports. One scenario where this would work would be pairing the iPhone with certain models of Beats speakers -- Apple recently acquired Beats -- that contain NFC chips. Peer-to-peer mode could also simplify the exchange of files between two iPhones.
Reader/writer mode lets the NFC chip read "tags" that aren't NFC-powered -- for instance, a food package that works with the phone to display ingredients or nutrition data.
Observers are still awaiting details about the NFC chip in the iPhone 6, such as its compatibility and how durable a solution it will be for retailers. Given what’s at stake for all concerned, though, worries about those issues are probably unfounded, according to Canalys’ Matte.
"Apple knows that retailers don’t want to convert to technology that’s going to be obsolete in a few years," he said. "And with all the Android phones that will be using similar technology, [Apple] wouldn't use a chip that only works on iPhones."
Posted: 2014-09-09 @ 2:44pm PT
Whose chip is in the new iPhone?