[tabi] an alternative to accessible cash

  • From: "Chip Orange" <Corange@xxxxxxxxxxxxxxx>
  • To: <tabi@xxxxxxxxxxxxx>
  • Date: Thu, 21 Apr 2011 16:17:34 -0400

According to this article, we're on the verge of the "electronic
wallet", which will completely eliminate the accessible cash question:
 Editor's Corner
Near Field Communications: The Next Big Thing?
If you keep up with technology news, you may have already heard of
something called
NFC, which stands for Near Field Communications. This is yet another
wireless communications
protocol, a relatively slow method of transferring data that operates on
the 13.56
MHz band and only works at extremely close distances, around 4
centimeters, which
is only about one and a half inches. In other words, two devices have to
be almost
touching in order to communicate via NFC, although there are antennas
that extend
that distance up to 20 cm (almost 8 inches).
You might wonder what good a wireless connection is if it requires being
that close.
The answer is that it can basically turn your mobile phone into a
contactless card
or RFID reader, or allow it to communicate with another NFC- enabled
phone or device
in a peer-to-peer relationship. So what does that mean? That is, what
can you actually
do with it?
One of the touted uses is to be able to use your phone in place of a
credit card,
to make payments at retail stores, restaurants, and other points of
sale. The phone
holds your credit card data (encrypted, of course) and when you want to
make a payment,
you hold it up to the NFC device at the establishment, which reads the
just as current credit card POS terminals read a card when you swipe it
through them.
The big advantage here is that you don't have to carry around a physical
card (or,
as most of us do, a dozen of them).
It's easier to lose (or steal) one card out of a stack of credit cards
without anyone
noticing for quite some time. Most of us now carry our phones with us
and we use them enough so that we would readily notice if they were
missing. Of course,
there's a down side to this, too. If you keep all your credit cards on
your phone,
you have a single point of failure so that if you do lose the phone,
someone now
has access to all of them. But one could argue that the same is true of
losing your
I can already hear someone saying, "Yes, but your wallet can't be hacked
into while
it's sitting in your pocket" and that's an excellent point. Your wallet
never connects
to the Internet; your smart phone probably does, via 3G/4G, wi- fi or
both. Obviously,
for consumers to trust this type of technology, it will have to have
very strong
security controls so that if a hacker should gain access to the phone,
he won't be
able to crack the encryption on the credit cards or other ID
And it's not just credit cards that some envision being baked into your
phone eventually.
Our driver's licenses, social security cards, health insurance cards,
concealed carry
licenses, membership cards, and pretty much everything else we carry in
our wallets
today could, technologically, become virtual "cards" that we carry
stored in the
memories of our phones. Imagine a day when you don't need to worry about
through a bunch of cards or carry cash with you - everything you need is
on your
phone. All this is an extension of the digital wallet concept, which is
used for
shopping online. Digital wallet software stores user information such as
credit card
numbers, shipping and billing addresses, etc. and automatically
transfers it to online
payment forms when you make a purchase. NFC makes paying "in person"
just as convenient;
all you have to do is hold your device up to the retailer's reader to
transfer the
Some people will love this idea and others will hate it. Personally, I
prefer the
thought of a phone full of personal info - with the risks that go along
with it -
to that alternative vision of the future where we all have chips
embedded under our
skin, but that's just me.
If you do like the concept, you might be wondering why another
close-range wireless
technology is needed. After all, we already have Bluetooth. But if
you've ever set
up a BT headset or keyboard or other device, you know it sometimes takes
a bit of
doing to get the devices to pair up. Two NFC devices will link up
automatically and
almost instantaneously. This is far more convenient - but of course it
also creates
some concerns about security. That's why the much shorter distance range
of NFC (as
opposed to the 1 to 10 meter range of BT) is actually an advantage.
Another device
will normally have to get very close to your device - close enough for
you to notice
- before it can establish a connection. However, eavesdroppers can use
antennas to
extend that range, so NFC is not invulnerable to attack. Another
difference between
NFC and BT is that NFC work with already-existing passive RFID tags, so
an NFC enabled
device can read those tags.
NFC requires special hardware, so it's not something that you can just
add to your
cell phone by downloading an app. However, there are already a number of
mobile phone
models that have NFC capabilities, including the Google Nexus and the
Samsung Galaxy
S II. The iPhone 5 will reportedly support NFC communications, too,
although there
seem to be conflicting stories about that:
As that article notes, RIM has plans to include NFC in its new
Blackberry devices,
and there are also rumors floating around that the next version of
Windows Phone
7 will have NFC, as well:
Major companies are committing resources to making an NFC-enabled future
happen sooner
rather than later. Former Google CEO Eric Schmidt outlined his company's
vision of
what NFC will one day be able to do:
NFC deployments are in progress all over the world. France's mobile
network operators
plan to put out a million NFC-enabled phones this year and provide
consumers in that
country with NFC services that include not only retail store payments
but also purchase
of tickets for public transportation, storage of coupons and loyalty
cards and information
Companies in Japan and South Korea are working together to create an NFC
for cross-border payments. NFC is being used in Switzerland in
contactless kiosks
that allow mobile phone subscribers to top up their phones. And
Mastercard has announced
its goal of making contactless payments a way of life in Australia and
New Zealand:
NFC is expected to be a big business in the coming years, and the
industry even already
has its own dedicated trade publications and events. Near Field
Communications World
Asia 2011 will be taking place this week, April 13-15, in Singapore. And
you can
delve more deeply into the subject of NFC by checking
NFC is coming (and in some cases, already here), whether we like it or

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  • » [tabi] an alternative to accessible cash - Chip Orange