NFC technology is sound, the interface is good, the partnerships have been formed, but … Will consumers use it?
By Ryan Kline, Contributing Editor
The widely talked about London launch of contactless payment devices is only a little over half of a year in, but London is making news again with its Near Field Communications (NFC) trial. Started in November 2007, major players in the telecommunications, banking and transit markets have come together to test NFC payments in both transit and retail environments.
“If you want to make something happen, you have to work as a team. At this moment it is really important to interact with one another,” says Gerhard W. Romen, head of NFC market development for Nokia. “This partnership is about making something happen, and that is what we are all committed to do and show here.”
Romen says everyone comes to these trials with a goal of learning a few things and hopefully getting one step closer to commercially rolling out the standard-based NFC technology. ABI Research predicts that ten percent of all mobile handsets will support NFC by 2010.
“It’s not a revolution – it is really an evolution,” says Romen.
The purpose of this NFC trial is really examining the customers’ attitudes and opinions about the technology. This is not a trial to determine if the technology works, but to see if the customers want to use it. “We think the benefits will be for the customers,” says Sue Doyle, the marketing director for Transys, the consortium in charge of the Oyster card. “This should make their lives even easier than the Oyster card did.” There have already been more than 10 million Oyster cards issued accounting for 38 million trips a week using Oyster. This makes up nearly 80% of all Underground and bus payments. Transys is also looking for new ways to deliver their product.
O2, the mobile phone service provider in the trial, also sees the benefits of NFC. “The aim of the trial is to test the widest possible uses for NFC technology on the mobile device,” according to an O2 spokesperson. “Oyster cards are probably the most common and widely accepted use of contactless technology for consumers so it is essential it be included for this to be a comprehensive trial.”
Most people agree that Near Field Communications has its advantages, and the most common one is simplicity. The deciding factor is not that the consumer decides to use NFC because it is cool, but they want to use it because it’s convenient and simple. Behind the simplicity is technology. The difficult part is making sure the technology is so easy to use that the consumer doesn’t even think about what exactly is happening in the phone.
“The real beauty of NFC lies in its role as an enabling technology that opens up various forms of communication and transaction in a very comfortable, user-friendly way,” says Heikki Huomo, CTO at NFC tag manufacturer Innovision. “In the same way that people use a straightforward switch to light a room, or turn a handle to open a door, NFC allows people to use the simple act of touching or placing their device close to something to initiate the desired service. This makes using any form of electronic ‘service’ and other interactions more accessible to more people, whatever their age or ability.
An example of the simplicity brought by NFC is when two people want to exchange electronic business cards using a Bluetooth wireless connection between their mobile phones. With NFC, setting up the connection is simply a matter of touching their phones together. There’s no need for the users to get their phones to scan the local area to locate and then identify the other’s phone, no need to enter pass codes or other settings, and no risk that they establish a connection with the wrong device.
Another part of the simplicity is having a device that’s easy to use. The phone used in the trial is the Nokia 6131 NFC, Romen says. “But the phone isn’t a phone anymore,” he says. “Suddenly it is a mini computer that some people still call a phone.”
The phones enable users to securely view their balance over the air and also add extra security to the phone. For instance, some of the payment applications allow the users to add a security question or PIN to protect certain areas within the phone. The liability is the same as any other credit card with a maximum exposure of £200.
“The nice thing is that anything that is currently in a physical wallet – in a paper or plastic format – can be ‘digital’ on mobile phones with NFC,” according to the O2 Spokesperson.”
But what if the battery on a device goes dead? If the battery dies, the NFC technology can still be used for another 2 hours, according to the O2 spokesperson.
“You can turn the NFC functionality on and off,” says Mr. Romen. “If your phone powers down, you can still use the functionality for payment. When the phone powers down, there is still some juice left in the battery. The payment takes that remaining energy, and when you touch the turnstile, it pulls from that and it works.”
Single wire protocol yet?
The preferred standard single wire protocol (SWP), a specification calling for a single-wire connection between the SIM card and an NFC chip in a cell phone and established by the NFC Forum is not being used yet, according to the O2 Spokesperson. “These types of phones will be used for future phases of the trial,” the spokesperson says. “We are using phones for the trial that store the applications on the handset itself rather than the SIM card. Once users validate that they are happy with these applications we will test with the preferred SIM architecture.”
Following the London launch of contactless payments, this NFC trial may bring some interesting feedback that should help the possibility of NFC becoming commercially available. At the end of the six-month trial, there will be an evaluation, Doyle says, but the earliest anything more could happen with Transys and NFC would be 2009.
But the data in the technology’s usability will be most important. One particular aspect is attempting to perfect the device’s Graphical User Interface (GUI). Polishing the GUI on the phone for payments and making it easy to reload and check balances over the air may seem like small steps, but these small steps will in turn assist in overcoming large barriers, says Romen.
More information will become available after the trial has concluded in May 2008.