Mobile phones are usually used to communicate with people far away but soon they could get the ability to do the opposite: communicate with things that are close enough to touch.
Phones will get some extra capabilities with the addition of chips for so-called near field communications (NFC), a wireless technology with a range intentionally limited to just a few inches.
The phones will be able to talk to payment terminals designed for “smart cards”, replacing credit and debit cards. They could also be used as public transport passes or two phones could be tapped together to exchange contact information.
Nick Holland, analyst for research firm Yankee Group, said adding NFC is like adding a whole new capability on the level of GPS navigation or a camera.
The industry has been talking about including NFC in phones for years, mainly to turn them into “electronic wallets”. Beyond a few trials, nothing much has happened, except in Japan and Hong Kong, where these systems have caught on for mass-transit ticketing.
But at the world’s largest mobile phone trade show, held last week in Barcelona, it was clear that the log-jam has loosened, in part because NFC chips are now cheaper. Millions of NFC-equipped phones will be in consumer hands in Europe and the US before the end of the year.
Jim Balsillie, co-CEO of BlackBerry maker Research In Motion, said at the show that “many if not most” BlackBerrys will have NFC chips this year. Google’s Nexus S already has one and the company’s latest Android software for that and other phones has NFC support. Nokia, the world’s largest maker of phones, has committed to putting NFC chips in all its next-generation smart phones.
Based on job postings at Apple, there is speculation the new iPhone model due this summer will have an NFC chip.
It is possible to upgrade some current phones with NFC chips. Small memory cards that are accepted by some phones can be given NFC capabilities. Both MasterCard and Visa are experimenting with “jackets” for the iPhone that have NFC chips, for instance.
But not all phones are compatible with these solutions, so the most likely way to get NFC into consumer’s hands is with new phones. Yankee Group estimates that there will be 151 million NFC-enabled phones in 2014, up from 834,000 in 2010.