What is the Killer App for Mobile NFC? It May Not Be Payments, Executives Agree at the 2013 NFC Solutions Summit
News from this week’s Summit
Burlingame, Calif., May 17, 2013–With half a billion NFC-enabled handsets equipped with NFC tap and go technology expected to hit the market in the next year¹, industry experts at the NFC Solutions Summit this week agreed that the major first step to broad NFC adoption has been accomplished. But discussion and debate continued as to what the killer app will be to get the technology to take off. The NFC Solutions Summit, presented by the Smart Card Alliance in partnership with the NFC Forum, was held this week in Burlingame, Calif.
Applications like wine tracking and device pairing that fulfill unmet needs and simplify activities may be the “world-winning NFC solutions,” according to Koichi Tagawa of Sony and chairman of the NFC Forum. In another example, Tagawa noted that Japanese airlines using NFC can board a 450-person plane in only 15 minutes, as opposed to the standard boarding process for a 150-person plane without NFC in 40 minutes.
Other speakers agreed that loyalty programs and offers are great first steps for consumers to use NFC technology.
Lynne Barton, vice president of marketing with Jamba Juice, which has been participating in the Isis Mobile Wallet pilots, said that NFC creates “more meaningful and personal conversations with customers.” She said that she “sees a future with NFC, but it will take consumers a little bit of time to get there,” adding that coupons and offers are “the gateway” to get consumers using the technology.
Lydia Martinez, store marketing specialist at Whole Foods, concurred that “for the short term, loyalty and the value of the couponing is the gateway for people.” She said that the appeal of NFC is to help “drive brand and drive loyalty while giving customers a faster experience.” Martinez described an upcoming holistic marketing campaign where NFC-enabled coupons and loyalty will work with in-store displays and social media to promote local farmers and producers.
NFC should “create, communicate and deliver value to customers,” Mohamed Awad of Broadcom and vice chairman of the NFC Forum told attendees. He said that creating value for NFC is about “simplifying with the way we act with the more and more sophisticated set of microcontrollers around us.” To this end, Awad described several use cases where organizations are communicating the value of products to customers by differentiating with NFC, including smart home appliances, interactive games, travel services, opt-in magazine ads, and even tombstones.
Other speakers discussed mobile security features that could allow consumers to become more confident in using their devices for more sensitive transactions. Sebastian Taveau, Validity’s chief technology officer, described a vision of fingerprint biometrics providing consumers with a fast and secure way to unlock the NFC applications on their mobile devices. Citing that 90 percent of user-generated passwords are vulnerable to hacking due to being stored centrally in the cloud, Siva Narendra, Tyfone CEO, said, “Consumers demand convenience and expect security.” Narendra unveiled Tyfone’s new Connected Smart Card that enables the secure storage and use of multiple IDs that can be placed in a microSD, a key-chain, an iPhone case, or a wearable device.
But while speakers and panelists didn’t reach consensus on what the so-called “killer app” for NFC will be, speakers conveyed the great potential for NFC including mobile payments in the longer term. When asked the question “Is NFC dead?” compared to alternate technologies such as cloud payments, Glenbrook Partners Consultant Allen Weinberg stressed that all these technologies are still in the early days and it is too soon to make judgments on what mobile commerce technologies will be the winners and losers. “At the end of the day, we don’t have a widespread, commercialized anything yet,” he said.
The two-day NFC Solutions Summit is the leading annual NFC conference, featuring leaders from the entire NFC ecosystem. The 2013 conference brought together nearly 400 executives from financial services, payments processing, retail services, technology providers, applications development, and industry analysts in an interactive, instructive forum on the business issues, implementation milestones, and technology advancements happening in NFC markets.
The Smart Card Alliance has developed numerous educational NFC resources that are available on its website. Most recently, the Smart Card Alliance Mobile and NFC Council wrapped up a successful webinar series on mobile and NFC security fundamentals. The series of four webinars, held in partnership with GlobalPlatform and the NFC Forum, aims to provide mobile application developers and the mobile community with the education they need to choose the best level of security for their NFC applications. The recordings from the webinars are available for free on the Smart Card Alliance website.
About the Smart Card Alliance
The Smart Card Alliance is a not-for-profit, multi-industry association working to stimulate the understanding, adoption, use and widespread application of smart card technology.
Through specific projects such as education programs, market research, advocacy, industry relations and open forums, the Alliance keeps its members connected to industry leaders and innovative thought. The Alliance is the single industry voice for smart cards, leading industry discussion on the impact and value of smart cards in the U.S. and Latin America. For more information, please visit http://www.smartcardalliance.org.
¹ABI Research, March 2013. “NFC Installed Base to Exceed 500m Devices Within 12 Months.” http://www.abiresearch.com/press/nfc-installed-base-to-exceed-500m-devices-within-1