Apple to Add Near Field Communication (NFC) Payments to iPad 2 and iPhone 5?

[MacRumors]

Bloomberg claims that Apple will be incorporating NFC (Near Field Communication) hardware in the next iPhone and iPad. This feature would allow customers to use the iPhone and iPad to make purchases:

The services are based on "Near-Field Communication," a technology that can beam and receive information at a distance of up to 4 inches, due to be embedded in the next iteration of the iPhone for AT&T Inc. and the iPad 2, Doherty said. Both products are likely to be introduced this year, he said, citing engineers who are working on hardware for the Apple project.

Apple could potentially tie this payment system into people's existing iTunes accounts. It's described to allow customers to walk into a store and make payments directly from their iOS device. Apple may also incorporate loyalty rewards and credit system in iTunes as well. Other possibilities include using location based transactions to improve iAd targeting.

According to this source, Apple has already made prototype payment terminals intended for small businesses to scan NFC-enabled iPhones and iPads. These terminals could be subsidized or even given away to encourage adoption.

Apple has been hiring NFC experts as well as applied for several patents on the technology. A couple of previous reports have also pegged the next generation iPhone as having NFC technology built in.

Article Link: Apple to Add Near Field Communication (NFC) Payments to iPad 2 and iPhone 5?

 

[ArchaicRevival]

I'll still prefer good ol' cash

 

[twotwo11]

It's kind of funny that there weren't any news of NFC at CES, probably because it's not widespread yet.

 

[christian_k]

Is NFC a common payment system in the USA?

I have seen NFC in other applications (example: authentication in a car sharing system), but not as a payment system.

Christian

 

[firestarter]

Too late.

Visa are already rolling out an RFID based system in the UK and have been for over 2 years. No chance that Apple will be able to compete at this stage.

 

[VulchR]

This sounds like a HUGE security risk to me. Anybody know enough about this technology to know whether I am being paranoid?

 

[fpnc]

Yes, I think this is a done deal and it will certainly be in the next iPhone and most likely in the next iPad (although I wouldn't put money on it being in the next iPad).

 

[speed12]

This sounds like a HUGE security risk to me. Anybody know enough about this technology to know whether I am being paranoid?

I think, certainly the VISA system in the UK mentioned above, has a limit of £15 ($23ish) for any single transaction using NFC. From the VISA website, it says you may also have to enter your PIN occasionally as a security check, which makes sense - say for example if there were 3 transactions in a short period it might ask for your PIN (that is entirely a theory as to how this might work...).

More info on the VISA system here http://www.visa.co.uk/en/products/contactless.aspx. Of course, I have no idea what the Apple system would be like!

 

[jab1]

This sounds like a HUGE security risk to me.

Without doubt considering the security of iTunes accounts is already questionable to say the least.

I recently had mine hacked to the value of £390 and Apple were unable to allow me to speak to anybody (physically....only a robot at the end of an email) about it nor give me any explanation as to how it happened or what they would be doing to stop it happening in the future.

So based on the above why would I or any other person want to use this system?

 

[christian_k]

This sounds like a HUGE security risk to me. Anybody know enough about this technology to know whether I am being paranoid?

There is little known about NFC security, but it is questionable at least.

The idea of NFC is to keep the range very short (about 4 inches). This is intentional. If you hold your device close enough to the reader you are authenticated. No need to enter a PIN or password. The reason is to authenticate a ot of people quickly (example: use as a ticket in public transport).
But this can be abused by anyone who has stolen your device. This is probably ok as long it is a prepaid system and only a limited amount can be stolen. But when it is really coupled to your iTunes account or even the credit card.... ?

Bad luck.

The other problem is: There is close to nothing known about technical security (encryption etc). So security experts cannot evaluate the system. Security by obscurity has never been a trustworthy approach and has failed many times in the past.

Christian

 

[NightFox]

This sounds like a HUGE security risk to me. Anybody know enough about this technology to know whether I am being paranoid?

Of course there will be vulnerabilities, but there is in any payment system so you have to consider those in context. Bottom line is this type of payment system has been in use in various parts of the world for several years now and, if properly implemented, has not proved any more of a risk than cash/cheques/credit cards.

Best example of its use in the UK is the Oyster card used on London Transport which has been in use for years now, but also taking off in the UK there are now credit cards that you can make micro-payments with using this type of technology. As I say, it's how the technology is implemented that makes the difference, for example limiting the amount per transaction or daily maximum that can be made from each device.

 

[sukuba]

This form of payment is very popular in Japan, the iPhone is one of the only phones here that doesn't support it.

You can buy all sorts of stuff, from vending machine drinks to paying for gas, very nice.

 

[designgeek]

I hope to god this is true. I would love to use NFC to unlock my car by waving my phone at the window or something. Hopefully the API will be open to the devs.

This sounds like a HUGE security risk to me. Anybody know enough about this technology to know whether I am being paranoid?

NFC payments typically employ a separate authentication system. Usually you have to open a "Visa" app, authorize payment, and the NFC devices exchange information. It would be lots more difficult to pull the payment code from a device than it is from a credit card with a built in RFID chip.

It would be easy to assign a separate number to every transaction since the NFC devices in smart phones would be dynamic instead of the singe code in a credit card's RFID chip.

 

[fishmoose]

I prefer to pay in cash and I don't know if I'm comfortable with the security issues that could arise from this.

 

[MikeDTyke]

Too late.

Visa are already rolling out an RFID based system in the UK and have been for over 2 years. No chance that Apple will be able to compete at this stage.

Considering very few people are using the visa or mastercard rfid cards in trials and how many people use just one card, i think there's a wide open opportunity to do it right.

Not to mention the rumours of apple being involved in trials with Visa. Your argument ignores the possibility that they are working in partnership.

 

[Reed Rothchild]

I think, certainly the VISA system in the UK mentioned above, has a limit of £15 ($23ish) for any single transaction using NFC. From the VISA website, it says you may also have to enter your PIN occasionally as a security check, which makes sense - say for example if there were 3 transactions in a short period it might ask for your PIN (that is entirely a theory as to how this might work...).

I believe they currently use RFID embedded in your credit card. NFC would be used via a mobile device (though I'm not aware of any mobile device with NFC in operation as a payment device in the UK. Nexus S maybe?). They are limited to small transactions like you say, and occasionally the CC company will contact you to verify payments as a sort of security check. I occasionally receive SMS messages from the CC company asking me to validate purchases.

 

[MikeDTyke]

This sounds like a HUGE security risk to me. Anybody know enough about this technology to know whether I am being paranoid?

yep you're paranoid. Have you ever ordered anything over the internet, a dvd, a book, a download from iTunes? Well that was a greater risk.

 

[fpnc]

Note, NFC can be used for things other than purchases/credit so even if there were a huge security risk that might not matter for some uses. I suspect that NFC is going to be a check-box item for nearly all smart phones starting this year.

 

[designgeek]

There is little known about NFC security, but it is questionable at least.

The idea of NFC is to keep the range very short (about 4 inches). This is intentional. If you hold your device close enough to the reader you are authenticated. No need to enter a PIN or password. The reason is to authenticate a ot of people quickly (example: use as a ticket in public transport).
But this can be abused by anyone who has stolen your device. This is probably ok as long it is a prepaid system and only a limited amount can be stolen. But when it is really coupled to your iTunes account or even the credit card.... ?

Bad luck.

The other problem is: There is close to nothing known about technical security (encryption etc). So security experts cannot evaluate the system. Security by obscurity has never been a trustworthy approach and has failed many times in the past.

Christian

How do you know any of this? First of all the information can be encrypted, second, the distance for NFC is mostly due to power concerns, third, it would be just like having a credit card stolen, you report it to you card issuer and hopefully you were smart enough to put a passcode on your phone.

There is plenty known about the security, it is EXACTLY like radio transmission because it IS radio transmission. It's digital, and can easily be encrypted. It is a very simple system and can easily be evaluated.

 

[firestarter]

Considering very few people are using the visa or mastercard rfid cards in trials and how many people use just one card, i think there's a wide open opportunity to do it right.

Not to mention the rumours of apple being involved in trials with Visa. Your argument ignores the possibility that they are working in partnership.

It could well be the same technology.

Still - Barclays now have it on all their cards - and they're the country's largest bank. It's some way beyond trial stage - especially in London.

 

[silexh]

This sounds like a HUGE security risk to me. Anybody know enough about this technology to know whether I am being paranoid?

From what I have heard, NFC is safer than for example RFID (RFID chips can be read, and sometimes written, from some distance - they are widely used, in library cards, passports, actually any kind of card you can keep in front of a reader).
Many phone companies (including Apple, Samsung and Nokia), will be incorporating NFC's in their phones.
NFC can very well be used for safe payments with your phone (instead of using a card to pay, you just let your phone touch a panel and press "ok" on your phone)
Because it's use is very much like RFID, you could also use it: to clock in/out at work, as access control (open a door with your phone instead of a card), read information from posters and store it (in your agenda for example), and there is so much more you can do with the technology.
It's awesome!!!

Just don't loose your phone ...

 

[2 Replies]

Yet another reason to always bring a charging cord when you're going to be out and about for more than fight hours.
Not that this wouldn't be cool, but Apple should be working on ways to get their active battery life up to 12 hours, not necessarily ways to spend it faster.

 

[christian_k]

yep you're paranoid. Have you ever ordered anything over the internet, a dvd, a book, a download from iTunes? Well that was a greater risk.

If it is implemented well, it can be a huge improvement over cards with magnetic stripes. This is a very outdated system that should be prohibited IMHO. The data on the stripe can be duplicated easily and ATMs or point of sale terminals can be manipulated to do this without people noticing anything unusual. This has been done many times in recent years.

Christian

 

[MikeDTyke]

It could well be the same technology.

Still - Barclays now have it on all their cards - and they're the country's largest bank. It's some way beyond trial stage - especially in London.

It is the same technology (RFID is a set of standards btw) My reference to doing it right comes from the user interfaces and overall user experience that Apple will add to keep it simple.

I know at least 5 Barclays customers, none of them use it.

 

[LondonCentral]

So basically people in the UK are living the future, now.

Whippey!

Actually, they've been using this tech in mobile phones in South Korea (for example) for quite some time now.

Apple are by no means the first mobile phone manufacturer to 'trial' such technology. Of course, that won't stop them from claiming they are.