JBS Group, Business Advisory Services

Thursday, January 27, 2011

Mainstream Media Jumps Onto the NFC Hype Wagon

I love this headline from Britain's Daily Mail:

"End of the credit card? With one swipe of an iPhone you'll be able to pay for your shopping"
(There is the rumor that the iPhone 5 will have NFC. That may be true, but that was also the rumor about the iPhone 4. Whether it is true or not does not seem to matter to this writer.)

Or from CNN:

"You can already use your iPhone, Droid or BlackBerry to buy a hotdog at the ballgame, buy your Starbucks latté, or give a friend a few bucks by bumping phones. But by the end of the year you may not even think twice about reaching for your phone to pay at the register instead of fumbling for your credit card."

My goodness. You would think that NFC was already in all the phones and POS terminals and that we are weeks away from paying at the POS with NFC enabled phones. I also enjoy the American writers that claim that all of this fantastic technology is already being used here in Europe on a daily basis. I can tell you, as a European resident, it is not. Most Europeans are as clueless about contactless or NFC as are most Americans. What we do see here are Mifare cards for mass transit. There are only 2 phones available that have NFC. One is the new Google Nexus S and the other is a Nokia that is not very popular. And the NFC chip in the Nokia is not capable of working with NFC payment terminals yet.

It is very exciting to see the mobile operators and banks pushing this hype into the media. It means that they are serious about their commitment to mobile NFC payment. It is coming and it will change the way many people conduct transactions. But as I so often write, it is very important for those in the industry and investors interested in this industry to be discerning about hype vs reality.

But the dumbest comment I have read so far is this one:
"Ewan over at Mobile Industry Review says that “once Apple integrates NFC into their devices, it will be game over for every other provider in the marketplace.” He points out that it doesn’t matter if there are a good few billion people in the world who will never be able to afford an iPhone — they are outside the United States."

I do not need to repeat again my view of mobile payment reality. But I would like to add this footnote that came from a response I sent to someone just the other day.

There are a lot of companies jumping into this space.  There is a lot of money out there. There are a lot of potential customers and users out there. It is a big world. No one, two or even 50 companies are going to swallow the whole market. No one technology is going to be, ‘The One’. This is not The Highlander. There will be many winners in this market. There are golden opportunities for different technologies, different markets and different countries. Smart entrepreneurs and investors will have many opportunities to profit.

I recommend this as well:

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