bengali off the beaten bath

The Future of NFC : Rochester Business Journal

RBJ interviewed me for a piece on the future of NFC today. I wanted to post it for future posterity so I can look back and maybe see what I visualized right and or wrong at some point. My assistant transcribed from the recording. I typically record when I do interviews so I can critique and improve.

What’s your opinion of near-field communication (NFC)?  Is it the emerging commerce platform?  What are its pluses and minuses?  
NFC has been around for a long time in the form of RFID (Radio Frequency ID) and the technology hasn’t changed much since it’s inception. Todays NFC is really RFID->Passive->HF . I’ve always believed there was potential for convenience in NFC. I had a company called Evatech that used to manufacture RFID and Biometric operated locks in 2005 and we looked a lot at this technology. I had the Mobile Speed Pass in 1998 for gas and used PayPass when HSBC introduced it, but the SpeedPass, PayPass and ultimately my RFID Lock Company all failed because lack of widespread adoption. people weren’t ready then, but the laggards are losing. Laggards is not meant to disparage it’s the far right of the Diffusion of Innovation Curve. On the left you have the people who are waiting in line for a week to get the new device and on the far right you have the people who used to say they won’t get a cell phone.. now they won’t get a smartphone… Eventually when you get enough new stuff on the left, the right get’s on board eventually! People are catching up and it’s coming soon with NFC.

I attend all the mobile technology trade shows and there’s always a lot of talk about NFC, but the conditions have never been right..  but thats going to change starting in 2014 at the latest.

NFC has the right environment now because the public, the companies supplying the public with a universal id which is the smartphone) .. one nfc ..and high speed mobile data are all in the right place for  NFC combined with smart hardware and software to really take off.

There are pros to this…It’s creating a standard. Like any industry once a standard is picked, innovation can occur around it. When Japan picked switch based network technology they were able to provide the whole country with blazing fast internet in the 90s instead of arguing over standards. When VHS was chosen, you had a massive number of players and movies available cheap and easy to copy ..same goes for DVD vs blu ray. In this case NFC bested out other competing similar tech.
Cons too…as always There’s always privacy issues that people will bring up but that’s not as much a concern to me. Your credit card can be stolen as well but by the time NFC commerce  comes out it will have remote locking, encryption and pin entry probably even biometrics if we are lucky. There was a time when people were too scared to enter their credit card into their computer too don’t forget.

What I am most excited about is Emerging commerce platforms via NFC.
It’s aiding the platform to emerge, but like I said before its the combination of hardware software and partners.

Will NFC help spark a global transition to the mobile wallet?
NFC is not really sparking the transition, it’s just the chosen protocol for companies like Google and Apple and the credit card companies. they have picked nfc like the industry picked VHS instead of Beta, or Bluetooth instead of Zigbee. There’s another protocol called TEE and apples recently patented a similar alternative to NFC so while Mobile smartphone payments are def coming, it may be too early to call NFC the incumbent just because google integrated it.
The BIG driver for mobile wallets , is that all payments systems and POS systems which are run by Visa and Mastercard are now mandated to integrate NFC acceptance by 2014 in all the major retailers. This is huge. Theirs a carrier working on Mobile Wallet called ISIS that they are pouring billions into. The merchant support…This is the single biggest thing that will lead handset manufacturers to include or be backwards compatible with NFC and drive mobile wallets mainstream. They supply the platform NFC is the messenger that allows the customer to use the platform and the platform being modern and forgetting their fears is what drives it all.

There’s even companies like Gemalto that are backed by Amex visa and MasterCard for EU and Canada that has developed NFC on a SIM card and replacing your sim gives you instant NFC. This is happening now.

So even though Big retailers like Target and Neiman Marcus like maintaining control of these payment systems to control fees and chargebacks, access to available cash they are supposedly working on their own payment system platforms  as well ,though likely NFC and Target NFC  will he accepted just like Paypal at Home Depot or Target cards vs Amex to avoid fragmentation in mobile wallets use though i see target NFC having special rewards tied to it eventually. Passbook is just getting started its really dormant and waiting.

The global wallet is just around the corner.

Have you had any experience with NFC yet personally or professionally?  For example, does your company use it or would consider doing so?  Do you own a Samsung Galaxy S3 or another smartphone enabled with it?

Im a co- founder of in a startup company called Unisend that specializes in controlling everyday devices with smartphones and am a huge fan of controlling aspects of my life with a phone. In fact i first wrote about a system for mobile payments and household device control in 1999 at U of R for computer science project. I called it Cyrex, short for Cyber Rex, basically your digital fetching device. Of course before 3G and smartphones there were big usability pieces missing! It was a little ahead of its time. My demo was using a Nokia Candy Bar phone and the main issue was procedural human-machine interface issues which was of course solved when the iPhone and its touch screen hit the market followed by apps years later. LuxMobile does not do hardware, but that’s because we make accessories and right now NFC is mobile device integrated product as far as people are concerned not accessory.
However I’ve been following NFC for a long time. I don’t currently own a device with it because I’m in the Apple camp and have no desire to go Android right now but I have some ideas on what NFC could be used for on hardware devices… NFC Tags are pretty interesting and thats where I see potential use for LuxMobile in the future.

For example when you place your NFC  phone near an NFC tag, it could bring up a website. That’s like a QR code but App-less. Or you could put it in a phone car holder and Bluetooth Activates, Spotify Launches and the Volume is set to max. Maybe you have one on your night stand as well to go into Alarm mode and Silencing notifications.  It’s going to allow an elegant interplay between hardware or product location and device ulilization and I could see us getting into that kind of interaction when the time is right.  It will also be used heavily in public transportation, lines, all kinds of ticketing systems.

Personally Ive used similar systems in China with their Squid Card and in London with the Oyster Pass. It would be like those except on a mobile device instead of a chip on a card. I’ve been waiting for any system like that to come to the USA for sure. Our China office also uses NFC to detect if a person is allowed to get in or not. Here I fake a lot since NFC isn’t here yet. I have iPhone activated lights and heaters in my house that I can program via app and also rigged my car so I can start lock and unlock it from my iPhone.

Did Apple make a mistake not including NFC in the iPhone 5?  Is that a major setback for the adoption of NFC?

Absolutely not on both counts.  The next iPhone will definitely have an NFC Chip. Apple’s jumped in first before this a number of times and they let Google do the experimenting and creating awareness this time and by then there will already be a far deeper integration to retailers by 2014 as I mentioned before. What I’m saying is by 2014 every major retailer in the USA will have NFC reader capability if they stay on track. Apple releasing an NFC phone around October 2014 is a likely course of action. By 2014 its estimated about 300M phones will have NFC.

It’s also very clear to me being a fan of Apples Answer to Google Wallet, the Passbook that Passbook is going to be deeply integrated with NFC and will have an API with deep integration to ecommerce transactions allowing apps and developers to take payments in new and creative ways. Square and GoWalla and Apple themselves in their store have innovated a lot in this space and it will only get better.

Apple thinks about how they can make it easy for the user then figure out how to monetize. They dont think about how to monetize first then tell the user they can have it. Apple is going to sneak up on the industry with Passbook just like they did with iPod, iTunes, iPhone and iPad. The war is taking place in the software while everyone else competes on speeds and feeds. NFC is going to be coming regardless and its game over when Apple intros their iPhone. They already have patents for alternative NFC technology as well so youv never know what they have up their sleeve.

At the end of the say it will be incredibly convenient it will be nuts not to use it. There will be tiers of adoption just like every technological breakthrough. There were laggers for personal computers, then internet, then mobile phones then smartphones. Most of these people always cave. I will be there day 1 to sign up when the platform exists.

Thank you. This has been very helpful.

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