Fortune – August 10, 2017
An upgrade to Apple’s mobile iOS operating system due this fall will enable iPhones to use the technology underlying the Apple Pay wireless payment system for more tasks.
Users of newer iPhone models, for example, may be able to use their phones as mass transit passes, security badges, or to scan products for information about their manufacture.
This is thanks to new support for near field communications (NFC) technology that Apple (AAPL, +1.22%) disclosed in June. And that, in turn, should help iPhones do more of the things that phones running Google’s (GOOG, -0.06%) rival Android operating system can already do.
Right now Apple’s use of NFC is limited to its three-year old Apple Pay systemwhich lets people make cash-free transactions by holding their phone up to an NFC reader. The new operating system tweaks will open up access to the phone’s existing NFC chip to more types of applications, as noted by tech news site Engadget in June.
The thing about this is that Android users already have had many more NFC-enabled options than their iPhone toting buddies. In some regions, Android phones double as bus or train passes, door keys, and for checking whether that $2,400 Maria&Donato purse is authentic or a knock-off.
Apple’s addition of what it calls “CoreNFC” to iOS 11 means that iPhones going forward will be able to read more types of NFC tags than those used for payments so developers can build applications that take advantage of secure NFC connectivity. And that could help Apple close the Android app gap.
As an example of existing NFC applications, check out the Khushi Baby project in India, which puts infants’ encrypted medical data on a tiny wearable necklaces. Then physicians can access the information by holding a properly authorized smart phone or other NFC device near the necklace to get the medical information they need.
Some luxury goods manufacturers, including Salvatore Ferragamo and the aforementioned Maria&Donato, already use NFC tags to help shoppers validate the authenticity of their goods to thwart counterfeiters.
App developers see more of those kinds of applications coming to the U.S., partly because of Apple adopting the technology.
Igor Faletski, CEO of Mobify, a Vancouver, B.C. company that specializes in mobile apps, is excited about the possibilities. With CoreNFC, developers will be able to create and embed electronic tags in objects and then make iOS applications to use the data in those tags. “This is likely to enable a lot of great local applications—transit passes and productivity apps for scanning merchandise in stores and warehouses,” he said.
Thinfilm, an Oslo, Norway-based company, makes smart labels that incorporate NFC chips for businesses including vineyards, cosmetics companies, and luxury goods makers. Products with these embedded tags can be tracked from manufacturer through distribution to store shelves. After the sale, the tag can also confirm that the appropriate taxes have been paid on the purchase.
Don Tait, principal analyst with research firm IHS Markit, agrees that there are many possibilities for the technology. “People are focused on smart phones, but you can add NFC support to watches, ATMs, sports equipment, and medical devices as well,” he said.
It is worth noting that Apple, which usually works in a controlled, walled environment, is showing signs of opening up by incorporating this technology. That may be because it sees a growing threat from the Android camp.
Just as adding NFC capabilities could help Apple, it would also likely boost NFC adoption in the U.S., where Apple controls a large part of the mobile device market.
“From a technical perspective, this is largely a parity play for Apple to catch up to where various Android phones have been for years,” says Bill Magnuson, CEO of Appboy, a mobile marketing software company. “Despite being late to the party, Apple’s endorsement of standards like this can be a catalyst for widespread adoption of new use cases that have been years in waiting.”
This support could also help NFC start to replace QR codes that are sometimes used to encode product and pricing information in products. QR, or quick response codes, are those square black-and-white bar codes that people scan with smart phone cameras to get more information.
To date, NFC adoption in the U.S. beyond payment systems has been slow largely because of Apple’s late and limited support for it, says Phil Sealy, principal analyst with ABI Research. As Apple starts to embrace the technology, companies can start tapping a much bigger market in the U.S.
The upcoming NFC compatibility, as described by Apple, just covers “reading” NFC tags. It doesn’t look like Apple devices will be able to take the NFC data they have scanned and share it with other devices. In the Android world, users can put their own devices together to share” that data in a “tap and go” model, says Magnuson.
But hey, it’s a start.