NFC: Get Ready for the Hype Cycle

Carl Weinschenk

After years of bubbling just below the surface — perhaps peeking through every once in a while — the public is about to be fully addressed by near-field communications (NFC)-based technology.

That’s the sense, at least. GigaOm reports that Isis — the mobile payment company owned by T-Mobile, AT&T and Verizon — is releasing videos in anticipation of its launch in Salt Lake City and Austin this summer. One video was released in March. The bottom line is that subscribers of those carriers are going to hear a tremendous amount more about NFC during the coming months.

NFC-based phone payment systems aren’t the only use for the technology. Programmable tags are small paper or plastic items that attach to just about anything — the example in this Businessweek story is a spice container — and communicate with electronic devices when tapped or even brought close. The woman in the story can tap the spice bottle with her phone and conduct a Google search for recipes using that spice. The technology seems at this point to be massively replacement — tap the clock to set the alarm, tap the console to turn the burglar alarm off or on. The story suggests that NFC is about to become a lot more familiar:

NFC tags are gaining a following as the number of smartphones able to scan them skyrockets. This year the research firm IHS iSuppli (IHS) expects manufacturers of smart devices will ship nearly 21 million NFC-enabled handsets in the U.S. and 186 million worldwide, up from 93 million last year. According to press reports, Apple (AAPL) is considering adding an NFC chip to the new iPhone expected this fall, which would give the technology a significant boost.

Seeking Alpha blogger John Helzer does not underestimate the potential size of the market. The chip makers that stand to gain, he said, are NXP Semiconductor, Inside Secure, Broadcom (mostly via their 2010 purchase of Innovision Research and Technology) and Texas Instrument. He makes no overt pronouncement on the field in the article itself, but the headline — "The Near Field Communications Chip Market Will Be Huge" — suggests how he (or at least his editor) feels.

There still is a lot of work to do. The DroidGuy points that out, at least as it refers to Android devices. The Boston Herald reports that Apple 5 won’t have NFC. The reporting runs counter to the Businessweek piece and seems skimpy, so it’s best to wait and see. Apple's blessing is considered a major issue. If the phone indeed lacks NFC, it will be interesting to see how the industry reacts.

All of those issues aside, it is clear that NFC will play a tremendous role in the future of the interaction between device users, the objects they seek to control and the telecommunications network beyond. It’s a matter of when and how quickly, not if.



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