So another week, another Apple-will-have-NFC story. I’m sure you’ve seen it.
One of the reasons I was so disappointed by the recent Apple keynote was the total lack of new hardware. One of the key points we were all looking for was Apple’s NFC strategy. The reasoning was pretty straight forward: It’s game over for NFC once Apple sets the strategy.
I think the marketplace is changing rather dramatically though and the company’s (apparent?) delay has enabled other players (especially Google) to charge ahead.
The previous thinking went like this: Apple = a sexy company. Everyone wants to work with them. So the moment they announce NFC capabilities linked to your iTunes account, everyone-and-their-dog will queue up to work with them. Because it will just work beautifully. And Apple will have arranged a few influential partnerships to convince just enough of the industry to think, “screw it, let’s use their standard”. One example I’ve floated a few times is some kind of tie up with a sports association — like the NBA or NFL, to ensure that every single one of their stadiums offer NFC-ticketing at launch with the iPhone 5. Or Starbucks. Or similar.
It’s a lot more murkier now that I’ve started to see PayPass technology all over the place and now that other incumbents are busy making hay before the Apple gorilla gets stuck in.
Yet I wonder if the majority of the market is either consciously or sub-consciously waiting for Apple to get on with it, still. You can’t ignore them. You simply can’t. Not only are they ridiculously influential, they’ve got the capacity, the reach, the credit card numbers, the loyal customers… not to mention 80 odd billion dollars to spend as necessary.
It’s going to be rather exciting to see what they propose. Meanwhile I’m delighted to see that the rest of the world isn’t standing still. RIM, for example, recently had some of its handsets certified by Mastercard for NFC transactions. I’m hoping we’ll see some stimulating news from Microsoft/Nokia on NFC soon as well.
Meanwhile I think there is an element of wait-n-see. Because if Apple are going a completely different way from everyone else, the market’s going to have to make a determination. Apple still carry so much influence that whatever they announce, it’s likely that’s going to be the way ahead for everyone. Right? What do you reckon?
I was both a bit surprised and disappointed when the 4S was announced as I was sure they would be bringing NFC.
I guess it’s a bit of a chicken and egg situation, you need the phones to support it, but manufacturers might be holding back until more retailers support the technology and the retailers are waiting for the phone etc etc.
If next years iPhone doesn’t support NFC then I really do think that Android and Windows Phone but would become a lot more popular as I think I would move away from the iPhone after having them for the last three years so that I could get a phone with NFC support.
Aye I think you’re right!
The scuttle was that the virtual SIM would have left space in the casing for the NFC. No virtual SIM, so a physical one goes into which space… NFC. Boom, as they say. In elated news, 45 signaturies on the GSMA’s NFC on SIM standard last week. Let’s see what happens with that.
Couple of points and of course, given what I do I cannot resist.
Firstly, anyone who follows the likes the NXP could see that the next version (or as we now call it the 4s) would never have NFC in it given the number of chips they were shipping. But that is a really nerdy think to know and is probably only relevant to those who work in the NFC world.
But more importantly, the world of payments is and will be for many years to come, dominated by two companies, namely Mastercard and Visa. They have spent billions, yes billions, of dollars over the years ensuring that they have this dominant position. For Apple to come to the market and say “hey, we can do payments” just is not going to happen, certainly in Europe in any event. OK, so they may accept it in Apple stores. But outside of that there is the whole issue of PCI, Interchange, Acceptance, EMV, Chip and Pin.. the list goes on. Square, for all it’s nice and trendy niceness, has zero chance in it’s current form of coming to Europe, not least because merchants (that’s shop keepers to you and me) pay a lower charge, or interchange, on transactions that use Chip and Pin than Mag Stripe and Signature. They are seeing just how hard it is to come to Europe. So, why would Apple be different? Do we really thing that a brand that has 11% of smartphones in UK and Europe could make that difference? Those in the world of payments, outside the EMV companies don’t really think so and we spend a lot of time thinking about this, trust me.
The market is not waiting for Apple to enter, catch up, take over, launch or anything. We are actually waiting for technology around single tap redemption, lower interchange, lower cost of acceptance, SEPA and much more. It does not help that ill informed journalists go on about the security issues (when there are none) of using Contactless and NFC payments. That and the fact that the the current level of £15 is to low is an issue. However (I am on a roll now) the real money is not in payments as I have previously talked about in podcasts. The real money is is vouchers, tickets, marketing etc. That is an area that Apple could succeed in but again, I wonder given the in built greed and avarice from Apple to take 30% of all revenue whether the market would accept it.
Personally, I think Apple is leaving it to late and will, for once, be a laggard (although saying that, Apple are seen by many as a copier and not an innovator).
I totally agree with the lateness argument however I also believe that they’re the one company that could potentially unseat the existing infrastructure. I know this sounds crazy but done right, the boards at many big influential companies/players might melt. This is how Apple has managed to invade enterprise. Still though I think its getting too late. ——————————