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Summary:

Apple’s next iPhone won’t have near field communication (NFC) capabilities, according to Wall Street research firm Bernstein. Rumors have been going back and forth about whether would include the tech in its next-gen smartphone, which recent reports suggest we won’t see until at least fall.

An Apple NFC iPhone patent from 2010.

An Apple NFC iPhone patent from 2010.

Apple’s next iPhone won’t have near field communication (NFC) capabilities, according to Wall Street research firm Bernstein (via Business Insider). Rumors have been going back and forth about whether Apple would include the tech in its next-gen smartphone, which recent reports suggest we won’t see until at least fall (if not later).

Google moved early with NFC, including it in its Nexus S smartphone and showing off multiple uses of the tech at its I/O developer’s conference just last week. But NFC has probably gotten the most attention because of its potential for mobile payments. The tech’s inclusion in smartphones could allow users to pay for goods and services in the real world simply by swiping their mobile devices in front of NFC equipped payment terminals.

That and other applications (like mobile advertising and home automation) make NFC an exciting future prospect, but will Apple suffer from not having an NFC-equipped smartphone out in 2011? Not likely. NFC may have a lot of interesting potential, but don’t expect to see it become a significant part of anyone’s daily life for some time yet.

According to ViVOtech CEO Mick Mullagh, who spoke to our own Ryan Kim, NFC won’t take off in a big way until next year. Even then, we’re only likely to see the tech starting to catch on. Isis, the NFC joint venture between Verizon, AT&T, and T-Mobile, said it will only launch its first pilot program in Salt Lake City next year. Really widespread adoption and the reach of supporting infrastructure are still probably a few years out. And since NFC’s biggest trick is payments, which is a complex field with lots of established players, upstarts and regulatory concerns that need to work in harmony in order to appeal to consumers, you can safely bet that the word “NFC” won’t be printed in big glossy letters on consumer electronic product packaging any time soon.

Apple is no stranger to sticking to the sidelines while a technology works out its adolescent issues and gains a little more maturity. It waited until 3G networks were fairly built-up and available nationwide before deciding to include that wireless broadband standard in its iPhone. Apple also has yet to suggest that it will be providing an LTE offering in any of its upcoming mobile devices, even though 4G-equipped Android handsets are already making their way to market.

While Apple may miss out on some early learning experiences regarding NFC by keeping itself out of the game, it can probably catch up on any tricks it might miss with strategic acquisitions down the road. And until NFC proves it has something to offer that consumers want to buy, it’s not doing much good for Google besides providing interesting tech demos for developer conferences, anyway.

  1. There are learnings to he had all round, I would think the soon companies start their prototyping the better.

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  2. Richard Walsh Monday, May 16, 2011

    I personally don’t think lack of NFC will hurt the chances in the average consumer’s eyes.

    Most don’t even know what NFC is, and wont until something shows up on the market. Another large portion of them wont trust the data transmission. Look how long MasterCard’s PayPass has taken to go full steam. At least here in Canada I haven’t seen many users.

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  3. No, because only Apple has enough clout bring about new standards and changes in infrastructure. Unless the infrastructure for NFC payments (mobile billing systems, NFC kiosks, etc.) is in place and used LONG before NFC-enabled iPhones come, the lack of NFC in the next iPhone is irrelevant, because it’s Apple vs. Many. It’s 1:M if we look at the competition, and the competition isn’t willing to stand together to bring about a new standard or way of doing things–they’re too busy fighting amongst themselves.

    Look at the percentage of each industry that Apple has an influence on, especially those where Android/BB/MS are also players. Does Apple have a majority influence? If so, that is an industry that won’t be see large-scale NFC adoption until Apple makes it part of the end-user experience. Those are the firms that will wait for “the Apple way” of doing NFC.

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    1. clearly your an Apple fan so your outlook is muddled. but perception & reality are not always the samething, numbers matter in this case. with Apple marketshare being stuck at 25% for over a year now if the rest of the industry moves on too NFC (Android especially) then it will become a standard.

      if Apple’s “clout” was all that mattered then why have they failed so many times in the past at creating standards? the only company with a worse track record is Sony. if Apple truly has the power to create a standard on their own than they will create an alternative too NFC, but they won’t.

      Google adoption of NFC is no surprise as they are progressively beta, it’s just their style. Apple entering late too the game is also no surprise as they don’t like taking risks.

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      1. You’re dead wrong on this one. Apple has become extremely good at providing “the whole product” experience. See iPod (music player), iTunes (integrated media store), iPad (tablets), iPhone (smart phones), OSX / iOS (desktop and mobile OS), App Store (app stores!) for just a few examples. Look around you, do you notice how every decent “smart” phone now looks just like an iPhone? If you blink its ridiculously easy to mistake any of Samsung’s phones for an iPhone. They are clones of the first success story.

        These products/services are all standards. Everybody now wants to BE Apple. Or buy into it. Notice the Market Cap lately? What are you not seeing? How can you ignore the value being created?.

        NFC will take off precisely when Apple pulls it all together into a cohesive user experience. Why? Because they are the only ones big enough, with relationships, with strong UI design and innovative enough to pull it off. The NFC revolution *could* happen without Apple, but I would bet it doesn’t.

        Btw Check out the emerging Cloud Music services. Amazon and Google start. Apple pulls it all together. Same story.

        NFC will be fun and full of potential until somebody pulls together a cohesive experience. My bet is that will not be Google, or Microsoft, or the Carriers (AT&T, etc) it will be Apple per usual.

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      2. furblada,

        I am the exact opposite of an Apple “fanboy.” I go with the best product, period. I’ve always had Android phones, too, so there’s no loyalty to iOS on my part.

        They do have clout because, despite what numbers may say–flat adoption rate–the market (i.e. the consumer) believe in Apple. Most valuable brand, right?

        There’s a reason for that.

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  4. Who cares at this stage of the NFC life its all “Dog and Pony” show! At this yrs Google i/o, the demos for NFC where from stuff that was happening back in Asia in 2001……….Pls, load your music with a tap………

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  5. The iPhone is a mere 6.75% of the total mobile market in the US. So, if they get left behind on the mainstream NFC front, it really doesn’t matter. NFC, like any emerging tech, takes time to gain adoption. In this case, it will be Android, Blackberry and Nokia users who take the lead…as they cumulatively represent a far larger market share and wider demographic than iPhone.

    The interest and collaborative efforts taking place between Carriers, device manufacturers and even credit card companies is akin to the early days of QR codes in Japan (which took off, big time). Apple being left behind on NFC or playing catch-up later is a #fail on their part – Let’s not pretend it’s anything other than a missed opportunity for them.

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    1. Sam,

      You have a great point, but I also don’t think such strategy–e.g. implementing new infrastructure, etc. –is necessarily carried out only when the market has reached X level of saturation. That is, I think it is also carried out in anticipation of that level, based on rate of adoption. Currently, iPhone adoption rate is high enough to be a force. If competitors are concerned about marketshare–Android, MS, BB, Nokia–then yes, we can assume that iOS is a threat. If it’s a threat, it’s likely a force great enough to be disruptive.

      I think Apple’s strategy is to generally implement a “test bed” of the infrastructure, have users get accustomed to that way of doing things (i.e. if it’s a new way) and have retailers and other vendors line up to get “certified” or whatever Apple will require of them. It’s incremental and it’s calculated. That’s the Apple way. Always has been.

      @moids

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    2. Uhm…you wanna try 24.7% mobile market in the US for the iPhone?

      “For the three-month period ending in January, the iPhone was flat at 24.7 percent” Right here on gigaom…

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      1. Jeff,

        Good catch. I shouldn’t have said “adoption rate high enough to be a threat.” I meant that it’s a strong enough brand with its current market position to be disruptive.

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  6. Just going to just tackle the title, the rest off the article can be answered to after that point:

    Hurt its chances for what? NFC is being driven as a commerce solution, the iTunes ecosystem is what’s being chased after. The fact that Apple “might not” go NFC says more about what they can do to create purchasing environments than other companies hocking NFC. What does NFC bring to the table that Apple hasn’t or can’t? Until BI and other firms can answer that in a compelling piece, there’s nothing about NFC (or any tech for that matter) that Apple needs to respond to. If anything, I’d argue that half the industry is waiting for Apple to lead… which probably is more true of NFC than much else appening in mobile that’s not consumer-centric.

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    1. Fantastic response, ARJWright. That’s exactly what I’m talking about; you put it a bit more eloquently than I did!

      @moids

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  7. not very similar to it, but thanks

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  8. to be frank, i don’t know what is NFC

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  9. Jahan Khan Rashid Tuesday, May 17, 2011

    Apple will do their own thing, a bit like they pushed Streaming movies and ignored BluRay, pretty much the reason i dont own a Macbook/imac etc

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  10. If anything, NFC will get hurt should the next iPhone lacks support. Apple still is a leader in mobile and has a extremely valuable customer base.

    I don’t really buy your summary. First, suggesting that Apple is either in or out is a tad misleading. The next iPhone doesn’t need to support NFC for the folks at Apple to be perfecting future implementation. Second, your suggestion that NFC has little offer consumers is again a bit misleading. Several major international markets use NFC extensively. Despite the fact that there is virtually no adoption here in the states, I use the NFC capabilities of my NS multiple times a day (thanks to NFC Task Launcher), and it is great.

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