Recently we have seen a number of leaks and claims leading to the launch of the upcoming iPhone 6. A recent one shows that the device might include near-field communication (NFC) as part of its hardware. Images of NXP Semiconductors chips have been leaked across Internet sources showing where the NFC chip could be embedded on the phone’s chipset. By including NFC hardware, Apple and the stakeholders in the market could be embarking on a new journey toward payments.
Pacific Crest Securities recently mentioned in a research note that Apple is in talks with Visa to announce a mobile payment partnership in the near future. There have been rumors that Apple’s payment solution would include the use of a “secure element,” and many are speculating that to be NFC. With more than 800 million payment cards on file, Apple can be expected to come up with some form of payment system.
Apple filed another NFC-related patent on May 22, providing a hint that we can expect exclusive circuitry for NFC in the next iPhone. The patent states that different antenna structures may be formed at opposing ends of an electronic device. The combining of circuitry could enable NFC and non-NFC circuitry to be coupled to common antenna structures.
Rumors of Apple’s incorporating NFC have caused a commotion in tech circles, with more than 3,000 articles and blog posts being written on the subject. Recently Morgan Stanley caused an uproar by confirming the rumors based on chip shipments. One of the company’s analysts says that Apple might be poised to adopt the technology soon enough to bring more to the payments industry.
In a recent note to investors, the analyst pointed out that a licensing deal might have been struck between Apple and NXP. The analyst claims that NXP signed a licensing agreement with a customer, in the fourth quarter of 2013, related to its emerging ID business. That customer might very well be Apple, with NXP being considered as its NFC-hardware provider. The analyst also claims that NXP is accelerating its R&D operations on ID development by supporting a new program that is lining up well with the launch of the iPhone 6.
Apple has filed a number of patents in the past year hinting at the use of NFC, including the following:
- The “iTravel” patent.
- The “iWallet” patent.
- The “Shopping” app patent.
- A patent for “Establishing NFC Session.”
- A patent on “Send Payment Data through various Air Interfaces.”
If the iPhone 6 comes with NFC, it could be a game changer for the industry. The inclusion of NFC is highly important for the following reasons:
- NFC has not taken off much in the payments space; this could change overnight with Apple’s support.
- NFC and associated technologies, such as Host Card Emulation, could find the light of day in payment services, as there have been problems with their adoption.
- The entire app-development environment would find a great opportunity in the form of development around iOS-based payment apps.
- Many banks are already looking at the iPhone for their mobile banking app because of the iPhone’s Touch ID for authentication. They would find a new reason with the inclusion of NFC.
A new iPhone is imminent, and again there is much speculation in the payments world as to whether Apple will finally join the NFC fray. It now appears that the iPhone 6, which is expected in September, will be the device that sees Apple enter the mobile payments market.