Can you imagine a world where the only thing that you needed to carry around is your cell phone? The technology for your phone to act as your wallet already exists and may be available in cell phones soon (Dvorak). Research in Motion, the company that makes BlackBerry smartphones, is the leading company in trying to incorporate NFC technology, or near-field communication technology, into their cell phones. The technology would allow for people to pay for things with only the scanning of their phone. The phone could hold credit card information and bank information enabling people to pay quickly with the swipe of their phone. There are both potential benefits and problems with this technology.
This new technology has many potential uses besides paying for products and services. Business partners could use their phones could use NFC technology enabled phones to transfer data. Phones can scan NFC chips located anywhere to read information or receive data. There are already applications for the iPhone that can turn on a car remotely, so NFC technology could potentially be used to replace car keys with cell phones.
Of course a main concern with NFC technology is putting sensitive information on a portable device that can easily be lost or stolen. People already steal credit card information using credit card readers that can take information from credit cards, so phones having a technology where the phone just needs to be near a scanner to pay could encourage identity theft. However passwords and security features could disable stealing and would probably be considered by cell phone manufacturers once the technology is included.
Smartphones are becoming increasingly popular as prices become more affordable and features become more advanced. The addition of NFC technology would add another dimension to smartphone capabilities and allow phone manufacturers and service providers to increase their profits. The technology could help consumers pay for things more quickly, shortening lines and increasing efficiency in busy places with long lines such as bus and train stations.
Many companies and websites have already used NFC technology for different purposes. What is preventing the technology from being incorporated into phones is the dispute between cell phone service providers and phone manufacturers. There are debates about how much money these companies will make off of financial transactions done through NFC technology and whether the NCF chip will be located in a SIM card or in the actual phone.
However, as an article on CNET’s website says about NFC on iPhones, “NFC is coming to a future iPhone, it’s just a matter of when” and this is true for all phones (Lowensohn). Once the cell phone service providers and the phone manufacturers are able to coordinate their efforts, phones with NFC technology will start being produced. This gives a huge incentive for companies to enter the market first so that they can profit from the first-mover advantage.
Works Cited
Dvorak, Phred. "RIM, Carriers Fight Over Digital Wallet - WSJ.com." Business News & Financial News - The Wall Street Journal - Wsj.com. Web. 19 Mar. 2011.
Lowensohn, Josh. "NFC: The Apple Rumor That Just Won't Quit | Apple - CNET News."Technology News - CNET News. Web. 19 Mar. 2011.
The idea of a digital wallet is a very interesting concept. Although it would be very convenient, certain issues raise a red flag for me. What if a person loses their phone while at work or on a trip, and then has no access to money to pay for transportation home? Or, what if someone loses their phone and before they are able to cancel their service the person who finds it runs up the credit card bill? I would be very timid to switch to a completely electronic wallet because I would be nervous that people were gaining access to my information at any point in time. However, if those glitches were worked out through passwords, and security I would be more willing to consider using this. Currently, Starbucks already has a similar idea available as an application. If you register a gift card with them, you are able to scan your iPhone at any location instead of carrying the gift card on you at all times. I use this application and find it to be a complete convenience because you do not have to worry about forgetting a gift card at home. I am curious to see how this technology will develop in the next few years.
ReplyDeleteHayley is right to say that it is an interesting concept and shes not the only one to think that. As an article on CNNMoney.com phrases it, "Welcome to the dawn of mobile currency." PayPal created an empire for itself by making it easy for consumers to send money online to friends and merchants. According to research firm Generator Research, by 2014, it expects mobile payments to reach $633 billion annually, with 490 million customers using their phones to move cash around. That's a significant increase in mobile phone usage and a whole lot of money! The looming game-changer in mobile payments though is a technology called "Near Field Communication" (NFC), which swaps data over very short distances, as pointed out in this post. Banking giants Visa, Bank of America, JPMorgan Chase, and Wells Fargo have also been testing technologies that would transform a smartphone into a wallet. As a personal user of Bank of America, their mobile banking application has made it increasingly convenient for me to bank with them, especially as a student. This is also just the beginning, and the sky is the limit with this kind of technology.
ReplyDeletehttp://www.nytimes.com/2011/03/24/technology/24wallet.html?_r=1&ref=business
ReplyDeleteFrom the Times today! Good supplemental piece to the original post.
I really like this idea of having a mobile wallet. Although some people may be skeptical about switching entirely over to the electronic wallet, there are many benefits to do so. For instance, as Hayley mentioned the fact that you would only have to carry around one item is definitely a benefit. Having everything you need in one device is extremely convenient. The main concern that many people seem to have about switching to an electronic wallet is the fear of losing the one thing that has everything you need. However, I believe it is just as easy to lose a normal wallet as it is to lose your smartphone. People may even have an easier time keeping track of everything. By having everything you need in one device there is less to keep track of, and since the phone is so important, I think people would be less likely to lose it. In addition, there are so many measures to help recover or protect a lost smartphone. Now smartphones can be locked and located from any computer. As a cashier at Target I have actually seen this technology implemented. As team members we were trained in the new use of electronic coupons. Target now has the capability to scan smartphones as a coupon form. Although I have never encountered a mobile coupon myself, I know that more and more people are being to use these coupons instead. I would definitely be willing to switch to an electronic wallet, and I think this switch will become very popular in the next few years.
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