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Apple goes cool on NFC for now, Google leaps ahead

When Apple hired NFC expert Benjamin Vigier as its m-commerce chief last summer, it seemed to be jumping on the NFC mobile payments bandwaggon along w

By CAROLINE GABRIEL

Published: 16 March, 2011

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When Apple hired NFC expert Benjamin Vigier as its m-commerce chief last summer, it seemed to be jumping on the NFC mobile payments bandwaggon along with Google’s Android. But the contactless swipe technology will not, after all, appear in the next iPhone, with Apple citing its concerns that there are no mature industry standards yet. No such worries at Google, which will kickstart its NFC trials in major US cities by June.

According to UK newspaper The Independent, Apple has warned executives at several UK cellcos that it would not include NFC in the forthcoming iPhone 5. "Apple told the operators it was concerned by the lack of a clear standard across the industry," a source said, although it is assumed that the vendor will continue to work on NFC, for a future product or upgrade. Like Google, Apple could benefit from a rise in mobile payments, because it could tie such activities into its app store and iTunes, and leverage the vast amounts of customer data it stores to add value. It could also save the credit card processing fees it currently pays on music, video and apps purchases.


Apple’s delay may give it a short term disadvantage, but will signify a more ambitious approach even than Google’s. Notwithstanding the talk about waiting for standards, in fact the firm is said to be “working on its own NFC proposition” that would make use of iTunes, and this would likely turn up in next year’s iPhone.

Google itself is keen to move ahead quickly and win itself a pivotal role in mobile payments, a position also coveted by operators. The search giant is to kick off trials in stores in New York City and San Francisco before midyear, according to sources.

So keen is Google to stamp its mark on the burgeoning market for mobile payments - which could be tied into its Checkout and location platforms – that it will fund the installation of NFC cash registers and terminals in thousands of locations, reports Bloomberg. Users will be able to swipe or bump their Android devices against these terminals, made by Verifone, to make instant payments for goods or services. Google is also likely to support added value services on the same NFC platform, possibly coupons or gift cards.

The latest release of the smartphone version of Android, version 2.3.3, added NFC capabilities including an NFC reader/writer API to support third party applications. Google also plans to announce services that will rely on Android device users exchanging data or payments directly by bumping their handsets together.

RIM has also said most of its new products will incorporate NFC by the later part of this year, while Nokia and Samsung are also major supporters, and many operators are working on NFC-based commerce and location services. A wide range of operator driven trials is taking place in the US, Europe and of course Japan – the main location for live commercial services. In the US, Verizon Wireless, AT&T and T-Mobile are collaborating on an NFC-based platform called Isis, which aims to sideline the credit card and make the carrier network the centrepiece of a user’s financial transactions. It will use the payments infrastructure of Discover Financial Services, while the European cellcos have mainly cooperated with the giants Mastercard and Visa.

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