WSJ Claims iWatch Will Have NFC for Mobile Payment System

| Analysis

The iWatch Crystal BallApple's iWatch will come with NFC to be used with a mobile payment system, according to unnamed source cited by The Wall Street Journal. This will be an extension of the rumored mobile payment system that Apple will also be unveiling with the iPhone 6 during the company's September 9th media event.

Apple hasn't announced any of these products yet, and the iWatch itself may not be called the iWatch. With less than a week to go before Apple's media event, however, we've reached the point where the majority of leaks coming from reputable mainstream sources like The Wall Street Journal, Reuters, Bloomberg, and the AP tend to be accurate.

To that end, this is the first report I've seen claiming the iWatch will have NFC, and that it will be part of the rumored mobile payment system. If accurate, it is be one of the biggest non-health and fitness-related functions that have been reported for Apple's foray into wearables.

The Journal added that iWatch will come in two sizes, each featuring a curved OLED display. The piece also said that while Apple is likely to announce the device on September 9th, it was "unlikely" to ship until early 2015. Competing rumors on the shipping date have come from a variety of sources.

Another tidbit in the piece is that Apple's mobile payment system would "likely" utilize one-time encrypted codes for each transaction in order to protect credit card information. Note the use of the hedging language—"likely"—meaning the source was less than sure on this point. As security schemes go, however, one-time encryption codes are a nifty way to reduce the chance that anyone intercepting the signal can decrypt it.

Lastly, NFC in the iWatch and iPhone could play a role in Apple's HomeKit technology, a platform for home automation that Apple unveiled during June's World Wide Developer Conference. NFC was embraced by Google through Android, where it has since fizzled, but using NFC tags to automate all manner of things was one of the most interesting things to come out of that.

What will be interesting is if Apple's entry into NFC mobile payments and NFC as-a-whole is what the world was waiting for to take NFC seriously.

To that end, Jordan McKee, a senior analyst for mobile payments at 451 Research, told The Journal, "Apple's entry could be a tide that raises all ships."

It looks like we're going to have an interesting media event.

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Lastly, NFC in the iWatch and iPhone could play a role in Apple’s HomeKit technology, a platform for home automation that Apple unveiled during June’s World Wide Developer Conference. NFC was embraced by Google through Android, where it has since fizzled…

Bryan, I must admit that I am a bit surprised that NFC did fizzle on the Google/Android side.  With Google’s power and money, I really thought they would have worked the deals with the credit card companies and gotten more widespread support than just McDonald’s and Einstein Bagels.  I guess they’d rather just buy and sell cell phone manufacturers, work on driverless cars, robots, and drones, and that awesome eyeglasses project.  To me, their priorities just don’t make a ton of sense, but hey to each their own!!



Have they bumped the range for NFC devices to something useful for home automation? I could see that MAYBE they add NFC for something that was widespread, like payment systems. But for something like home automation, I think Apple would be less likely to add NFC in favor of iBeacon, which seems like it would be much more versatile.


jfbiii - If they bump the range for use then they’ll have bumped the rage for abuse. I think the short rage is a feature not a bug.


Of course I meant to say “...bumped the range for abuse.” (But I hear NFC abuse is all the rage!)


OK folks - I have a riddle and need some help. The discussion here about NFC in iWatch is interesting but let’s broaden it to iWatch + iPhone.

According to a widely-reported story <> Apple has an agreement with banks and card issuers that gives them:
1. card-present and card-not-present (i.e. on-line) transactions will have the SAME rate
2. the rate will be lower
3. Apple accepts form of the fraud risk

I have speculated earlier that this (3) would be a great move for Apple. Almost zero cost but it puts Samsung in a very awkward spot.

But come back to (1) and consider NFC. Many have said that NFC provides location data - I don’t know. Does it? Is it any better or different to that provided through GPS and combined into a BtLE-based transaction?

And how does NFC play into card-not-present transactions? Not in any way that I can see. So if the rates are the same for CP and CNP, why the hoopla about NFC? Something does not add up here. If there is no advantage, why do NFC? I don’t think it’s because NFC-enabled terminals are pervasive. So - why?

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