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With iBeacon, Apple is going to dump on NFC and embrace the internet of things

At WWDC in June, Apple (s aapl) quietly announced iBeacon, one of the more prominent features of iOS 7. Craig Federighi, Apple’s senior vice president of Software Engineering, mentioned nothing about about it in the keynote, and Apple hasn’t provided any details about it; it was only seen on one slide in the WWDC keynote.

iBeacon Apple WWDC 2013 iOS 7

Nor did Apple say anything about it during the iPhone event Tuesday. But I’m sure this is going to be a big deal, and startup companies like Estimote agree, announcing its support for Apple’s technology Tuesday and releasing this demonstration video.

Why is that so? For a couple of reasons: it opens a door to new set of applications such as indoor maps and in-store marketing, it makes the internet of things a realty and it might kill NFC (near-field communications), the wireless technology most linked with mobile payments.

What is iBeacon?

Using Bluetooth Low Energy(BLE), iBeacon opens up a new whole dimension by creating a beacon around regions so your app can be alerted when users enter them. Beacons are a small wireless sensors placed inside any physical space that transmit data to your iPhone using Bluetooth Low Energy (also known as Bluetooth 4.0 and Bluetooth Smart).

For example, imagine you walk into a mall with an iPhone 5s (comes with iOS 7 and iBeacon). You are approaching a Macy’s store, which means your iPhone is entering into Macy’s iBeacon region. Essentially iBeacon can transmit customized coupons or even walking directions to the aisle where a particular item is located. It can prompt a customer with special promotions or a personalized messages and recommendations based on their current location or past history with the company. Smartphones that are in an iBeacon zone will benefit from personalized microlocation-based notification and actions.

iBeacon demonstration example mobile shopping

In the age of context, iBeacon can provide the information you needed when it is needed. Just like NFC, iBeacons even allow you to pay the bill using your smart phone. The best part? iBeacon can run for up to two years on a single coin battery and it comes with accelerometer, flash memory, a powerful ARM processor and Bluetooth connectivity. Also, you can add more sensors to iBeacon to provide better context.

What is BLE?

As the name implies, Bluetooth Low Energy (BLE) is built specifically to consume small amounts of energy and make phone batteries last longer. But there are limitations with BLE when it comes to transferring data. BLE only supports very low data rates and you cannot stream audio using BLE. You can send small files using BLE and it is a good candidate for small data packets sent from wearable computing such as smart watches and fitness trackers. Built-in platform support for BLE was only added in Android 4.3 (some Android OEMs like Samsung and HTC did develop their own SDKs for BLE prior to Google releasing native support), which is why fitness tracker apps won’t work on some old Android phones.

Why it might be a NFC killer?

iBeacon could be a NFC killer because of its range. NFC tags are pretty cheap compared to NFC chips, but NFC tags are required on each product because NFC works only in very close proximity. In theory, NFC range is up to 20cm (7.87 inches), but the actual optimal range is less than 4cm (1.57 inches). Also, mobile devices need to contain a NFC chip that can handle any NFC communications. On the other hand, iBeacons are a little expensive compared to NFC chips, but iBeacons range is up to 50 meters. Not all phones have NFC chips, but almost all have Bluetooth capability.

Why it is so affordable?

Let’s go back to Macy’s. The average area occupied by a Macy’s store is 175,000 square feet, which is 16,258 square meters. iBeacon’s range is 50 meters (typical Bluetooth range), or 2,500 square meters. So a typical Macy’s store would need 7 iBeacons.

Estimote, a company which just launched to sell beacons, is taking pre-orders at the price of $99 for 3 beacons. The range of Estimote’s beacons is 50 meters, but the recommended range is 10 meters. If you go with the recommendation, you need 1 Estimote beacon for every 100 square meters, which would cost you about $5,000. If Macy’s wanted to add NFC tags (each at 10 cents) to all its products to send information to phones, it would cost $1,000 for 10,000 products, $10,000 for 100,000 products and $100,000 for 1 million products. NFC may not be needed on all products, but this will give a rough idea on how much it could cost.

Google’s focus is on NFC; it just added BLE support to Android

Google has been heavily focused on NFC from the beginning and it didn’t add platform support for BLE until the release of version 4.3. Lot of the apps that rely on BLE couldn’t release the apps for Android phones. Some Android OEM vendors recognized the need and rolled out their own implementations. Google finally listened to the demand and made it part of Android 4.3. But Google has continued to push on NFC and rolled out the NFC-based Android Beam in Android 4.0.

Apple’s focus on Bluetooth

iPhone5c20131-3

Apple has avoided NFC, and all the rumors about NFC getting added to iPhone 4 and iPhone 5 are turned out to be false. Instead of NFC, Apple worked on alternatives using Wi-Fi and Bluetooth. During the introduction of iOS 7’s AirDrop at WWDC in June, Apple’s mobile development chief Craig Federighi said, “There’s no need to wander around the room, bumping your phone,” referring how NFC phones need to be very close to transfer the data. As stated on Apple’s website:

AirDrop lets you quickly and easily share photos, videos, contacts — and anything else from any app with a Share button. Just tap Share, then select the person you want to share with. AirDrop does the rest using Wi-Fi and Bluetooth. No setup required. And transfers are encrypted, so what you share is highly secure.

New set of applications

With built-in microlocation geofencing features, iBeacon opens a door to new set of applications in indoor mapping. The GPS signals inside malls are very poor as the signals travel by line of sight, meaning they will pass through clouds, glass and plastic but will not go through most solid objects such as buildings and mountains.

This is the biggest problem for indoor navigation. Google has done in-store maps, but it couldn’t implement indoor navigation because of the line of sight issue. This is where iBeacon’s micro-location feature is going to shine.

From your smart phone, you’ll be able to connect to a nearest iBeacon and get its hard coded GPS location to navigate or use the signal to move to closer to iBeacon. iBeacon supports “enter” and “exit” events, so it can send different notifications while entering into the range and exiting out of the range. Imagine having a museum indoor tour with navigation, in-store navigation to the physical products, or navigation to terminals inside airports and subways.

BLE is the answer to internet of things

To make the internet of things a reality, a sensor’s form factor is very crucial. Size, affordability and internet connectivity are the key factors in a sensor. The possibilities are endless if you could control all sensors these remotely; switching on the AC on the way back home, controlling the refrigerator temperature based on the weather, controlling the room lighting from your smart phone, and so on. Estimote is also working on reducing the size of its beacons so that that they will be more affordable.

Apple has found a smart way to wirelessly transmit data over short distances using BLE. So why do you need to bump your phone with another? Why do you need NFC if you could share the data with anyone in the region with the existing bluetooth technology?

BLE can solve these microlocation data challenges in ways that NFC can’t duplicate.

Hari Gottipati is a software professional, distinguished architect, thought leader, consultant, speaker and freelance writer who specializes in Open Systems, Java, internet scale computing/apps, big data, NoSQL, mobile and Web 2.0. He is currently working as a distinguished principal architect at Apollo Group and in the past he worked for many mobile startups, as well as big companies including Yahoo, Travelocity, and Motorola.

Featured image courtesy of Thinkstock Photos.

182 Responses to “With iBeacon, Apple is going to dump on NFC and embrace the internet of things”

  1. This is about tracing every movement and everything you ever buy. Why did she buy this one? Now, why did she refuse to buy that one? Track her to the next store. Why did she refuse again? This is scary disguised as a helpful way to make your shopping better. This should only exist in a communist society. The goal is not to help you, it’s to track you and turn your everyday life into a lab rat experiment. Look at you with your stupidphone and the 100s of scientists poking at you with your probes stuck in every orifice.

    Run forest..run.

  2. iBeacon will be the most annoying marketing strategy possible. Could you imagine walking through the mall or down the street and your phone is being accessed by different corporation vying for your attention. Your phone constantly telling you that MACY’S has a deal or TOYS’ R US is selling a game for 6.99. If I had to pick a team and I am both a Mac user and android user. Mac for desktop and lap top purposes and android for phone. I would have to go with NFC!

  3. The Gnome

    Why does everything boil down to the Android vs. iOS argument. Aren’t you fanboys getting a bit tired of it?

    We all know people who USE their devices go iOS. Android is cheaper and “ships” more, but use is still low. Neither has “won” anything, and you aren’t going to make it as a store supporting only one.

    Looks like NFC is dead.

  4. this is just NOT TRUE !, the iBeacons are not transmitting ANYTHING else than a unique id (a number that would identify Macy’s in your example), and two numbers between 0 and 65536
    in Macy’s case that would be shop and aisle.

    to download ANYTHING you either have to be on their own WIFI or a 3G network, WITH their app, and contact their server, getting data based on those numbers.

    those damns beacons only broadcast 20 BYTES, OK ??? GET IT ???

    i keep reading the same bullshit over and over !

  5. The NFC ‘vs’ BLE comparison as stated in this article and the above example calculation is not accurate nor makes sense. Will 7 iBeacons conveniently and accurately cover all the 10.000 products at the spot? Does it recognize I am actually interested in those silk blue pyjamas instead of the cotton white ones laying on the shelve 30 cm to the right? I absolutely doubt that!

    Furthermore, major difference and sort of a “killer” point of BLE is the “push” factor, that lot’s of people find annoying and thus have their BT/BLE device turned off just not to be bothered by the retailer “promos”. On the other hand, NFC embraces the “pull” principle, meaning I only “pull” the information I need and when I really need it. No SPAM, no long range ads. Pure information on demand. That is the future of Internet of Things, not the wanna-be-revolutionary substitute for innovation by idea-short Apple cr*poration. ;)

  6. Konrad Andree Nordvik

    This artical is full of misconseptions and a total lack of understanding what NFC is and how its meant to be used. BLE brings nothing new to the table that NFC solutions can do and more.

  7. it seems many people are comparing apples with carrots. while BLE is mostly useful for indoor location, NFC has slightly different usages. NFC can be used to read information from a specific article bearing an NFC tag. similar result could be obtained with BLE but would require a user to have some interactions on the screen of his smartphone to select which products he wants more information on, just because BLE is not precise enough to discriminate among all articles present in the covered zone. now when it comes to contactless transactions like payments, ticketing, etc NFC is required because of its short range. so discussions on market share are in my opinion irrelevant.

  8. Does anyone know if an iBeacon was set at a shops entrance and a customer had the stores app would they receive the message every single time they walked past? Or could it be set within the campaign that only the first time the customer walked past, they would receive it? Thanks!

  9. Does anyone know if an iBeacon was set at a shops entrance and a customer had the stores app would they receive the message every single time they walked past? Or could it be set within the campaign that only the first time the customer walked past, they would receive it? Thanks!

  10. WisdomSeed

    There are benefits to both NFC and the iBeacon system. I’m not sure about all banks, but my bank has a limit on the amount of an NFC purchase to $15, which makes it really good for paying fares on public transportation.

    Apple, already has payment information for, I think the actual numerical term is, a gazillion users in its iTunes data base. And it has it in multiple currencies around the globe (more or less) Having used their payment system in both the Apple Store and Starbucks, it works just as well as NFC, but with a difference, and this is kind of important. Using the Apple payment system, the receipt is emailed to you, not so much with NFC, at least not yet.

  11. NFC and BLE while they do inevitable compete, I think there is space for both.

    I’m not so sure it’s a good idea to have your payment information floating around you however NFC is definitively better for transferring secure data. NFC is also more natural and simple then having to go into your phone, press the share button and then select the specific individual when there could be 30+ in the room. NFC has two steps 1)bring up content 2) tap together. More simple and secure.

    That’s not to say there’s not a need that BLE provides, indoor and underground Navigation is only possible with BLE (as of now) it’s cost effective and useful for many other things and I could definitively see this being used to transfer non secure information such as prices, inventory, item specific information such as nutritional information etc.

  12. jhajewski

    Does anyone know if the scenario is accurate? That someone can just walk by a store and have a message pop up on their phone? Don’t you have to install the store’s app first?

    • Julio Laker

      Yes you have to install the store’s app first and that app needs an embedded SDK so it’s not as if everyone walking through a shopping mall is going to get spammed randomly.

  13. jhajewski

    DOES anyone know how the BLE/Beacon technology can pop up a message on a phone, as a user walks by a store, without the app from the store already being installed on the phone?

  14. Jesus Sanchez

    Great technology with endless applications and possibilities, however lets use the Macy’s example. They send Mobile SMS campaigns today that are not personalized, the entire nation or SMS list gets the same offer, coupon or message. The real challenge is how enable retailers to action and personalized each beacon interaction. They need to combine trigger points with contact policies, an offer and content Managment system, a recommendation engine and create and present mobile optimized pages. Not an easy task at all

  15. Great technology with endless applications and possibilities, however lets use the Macy’s example. They send Mobile SMS campaigns today that are not personalized, the entire nation or SMS list gets the same offer, coupon or message. The real challenge is how enable retailers to action and personalized each beacon interaction. They need to combine trigger points with contact policies, an offer and content Managment system, a recommendation engine and create and present mobile optimized pages. Not an easy task at all

  16. It really amazes me that you guys make so much buzz for apple on okd technology. Ibeacon is just a reuse of a okd technology used fir proximity marjeting via BT. Lije this, most of what we saw as a “innovation” at the Appke jeynote was nothing new. Apple lovers might just need to be a bit more open to look for innovation in companies like google, Microsoft and samsung.

  17. Emanuel Stanciu

    I have to say that your math is a bit off when you calculate things.. if the “recommended range” of something wave-based is 10m, you don’t end up with 100 square meters. You use the area of a circle, not the square… so 10 being the radius, you end up with around 314 square meters. That is a lot more, so less beacons are required. Just to better inform your readers.