MWC 2011: NFC payment technology to dominate Mobile World Congress

Mobile phone suppliers and network operators are expected to unveil a host of technologies and deals, aimed at allowing people to pay for goods and services via their mobile phones, at the Mobile World Congress show next week.

According to analyst firm Juniper Research mobile phone payments will reach a critical mass this year, as retailers, mobile phone operators and consumers start to embrace mobiles offering near field communications (NFC) technology.

See also: More Mobile World Congress 2011 previews

The technology will allow consumers to pay for low cost goods, such as coffee or train tickets, up to a value of £15 by passing their mobile phones over a proximity reader.

“Over the past few months we have seen a succession of major announcements from operators and suppliers on NFC technology,” said Howard Wilcox, senior analyst.

In the UK, 02 has plans to offer mobile phones with a built-in wallet. Everything Everywhere (T-mobile and Orange) is working with MasterCard to roll out a commercial NFC service by the second quarter.

About 40,000 stores in the UK have NFC readers, capable of reading from mobile phones, and contactless debit and credit cards. They include Pret a Manger, and Little Chef. The Co-Op and McDonalds also plan to make the service available across their UK outlets.

“Supermarkets are guarded about their plans, but if you look at something like self-service lines, they have spread like wildfire. I would expect to see supermarkets having NFC capability in the not-too-distant future. It could be this year, it could be next,” said Wilcox.

NFC can be used in other applications, for example to verify the identity of a person entering a building or logging on to a computer, or to allow a customer to use their mobile phone as a hotel room key, in addition to mobile payments.

The technology could also allow people to transfer money to each other by touching phones, said Wilcox.

Outside the UK, France is developing the technology rapidly. There are plans to introduce it in the US, and the technology is already widespread in Japan, said Wilcox.

He predicts that one in six phone users will be using mobile phone payments by 2014.

Bill Goodwin, Computer Weekly

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