iPhone 5 to have NFC (Contactless Payments)

All the signs are there that the next iPhone will include contactless:

  1. Richard Doherty, director of consulting firm Envisioneering Group who work on NFC hardware, told Bloomberg that the next iPhones/iPads will have NFC.
  2. AppleInsider has discovered that Apple this week put out a call for an engineer with NFC experience.
  3. Apple filed a number of NFC related patents in 2010.

Aside from all these signs, NFC makes a lot of sense for Apple. At the moment their itunes store pays massive transaction charges for purchases bought on credit cards. Though highly profitable, it would be much cheaper for Apple to see more NFC payments which would debit a bank account and reducing their transaction costs. Google have already added NFC to their Nexus S, but the addition of a contactless iPhone will make the technology almost inevitable.

The infrastructure of contactless is appearing in many countries – aside from Japan and Korea who have had contactless phones for years, the US now has 750,000 contactless payment terminals. In the UK similar NFC devices are being rolled out in numerous shops and restaurants where there are 42,500 contactless payment points. Barclaycard and Everything Everywhere (Orange and T-Mobile) re-announced their plans to deliver a contactless handset from April 2011. With the payment technology added to phones there technological barriers to contactless will be removed. Of course, there is still one big ‘if’ with the whole – will users want to adopt it? It looks like the handset manufacturers (and banks and operators) are assuming they will. However, mobile is littered with technologies that users weren’t interested in (in spite of Face Time, how many people actually make a video call?). When it comes to NFC payments the big question from users will be security. How easy will it be for someone to get hold of my money?