How to Fix NFC and Help it Go Mainstream…

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Near Field Communications (NFC), promised to turn your phone into the digital key to your identity, transport and money.

The problem? This promise has been around since the late 90s, and shows no sign of crossing the chasm

How Does NFC Work?

The idea is you present your NFC device, to the NFC reader… and almost instantly the transaction is complete.  This will be very familiar to those of you who use the Oyster card on the Tube.

The User Experience Problem

Have you tried paying with a contactless card?  You’re never quite sure when to present the card to the reader, and often it can take a couple of seconds for the reader to recognise the card.  This creates a sloppy experience, and one that means only those with unlocked Nexus devices are using NFC today.

Google solved this in peer to peer using the “tag dispatch” system.  Sadly, the likes of Igenico, Verifone and Streamline who build the payments terminals most retailers use do not react nearly as well as an Android device does.  Herein lies the problem.

How *should* NFC work?

  1. NFC must be as easy to use as a touch screen.  This means overcoming any lag (like the contactless card example above).  This requires the same kind of user experience as touch screens now have.  If you remember those awful touch screens from 10 years ago? Or the one at your local supermarket… vs your phone.  NFC has to make that kind of leap in user experience.
  2. NFC software needs to be context sensitive.   When recognising another NFC device, both devices need to know how to play with each other and what the rules of the game are.  For a specialist NFC App working with an NFC terminal, this isn’t a huge problem… but if you just want to put your phone near the ticket machine at the train station… this becomes a problem.
  3. NFC must become more open.  NFC being a standard that has been driven by the GSMA is needless to say, very Mobile Operator driven.  The whole ecosystem is designed to be managed and leased by the provider of the NFC chip, who in turn re-sells that access.  This is a huge financial hurdle to adoption.  Why should OEM’s and big business adopt NFC, if the MNO gets to be the gatekeeper and charge for the privilege?

Crossing The Chasm

To solve these challenges, old school hardware manufacturers will need to embrace a Google like approach to NFC.  Speed and user experience is everything.  Contextual sharing (media, contacts, documents) has largely been solved, and I expect Apple to follow where Google has led.

Adopting This Approach Would Benefit

  • Security (door locks, car locks, building access)
  • Transport (rail, airlines – similar to how barcodes work today)
  • Ticketing (events, sports)
  • Form of Identify (Passport app, Driving Licence app)
  • Logistics (RFID style self aware packaging)

I’m sure you can think of plenty more, but the above are some of the more common examples.  My speculation is that this is why Apple has focussed on Passbook initially.  Apple owns a portion of the user experience.  The older organisations that own logistics and specialist ticketing equipment may take a little longer to catch up…

Your Thoughts Here:

Do you think NFC has what it takes to go mainstream?  Will another contender like Bluetooth 4 become standard because it’s not driven by the GSMA?  How can older manufacturing led businesses improve their NFC performance?

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If Data is the New Oil, Here is everything you need to know about mining…

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This whole “Big data” thing is touted as the new black, the new oil, the new Bradley Wiggins…

The Big Knowledge Gap

Big Data promises new insights, new value and is linked to this social media thing…  But how do you use it exactly?

You see, Big Data has two key selling points.

  1. It’s cheap. You can run it on a laptop if you wanted to, it doesn’t require expensive hardware, and some companies give it away for free.
  2. It’s fast.  Built for Grid Computing, Big Data is the back bone of the social networks and search engines.

How I’d Use Big Data 

For the purpose of this blog, I’m going to look at the value “Predictive Analytics” can bring to the payments industry, since it’s something I’ve looked into a little.

The best description I’ve heard of Predictive Analytics is…

Before my data told me what was in my rear view mirror. Predictive Analytics lets me see out of the windsheild to what is coming down the road.

You could actually use any old data warehouse for predictive modelling, but the “Big Data” tools sure help when you need to be able to ask questions rapidly  or when waiting 24 hours for the answer is not an option.

Now Let’s Imagine You’re a Retailer…

As a retailer I’d like someone to be able to answer some key questions for without having to invest in an expensive loyalty card scheme (e.g Clubcard).

My retailer loyalty card scheme only tells the me who my customer is when they spend in my stores, or with my business partners.

It would be way more valueable if I knew everything about know who my customer is, and what makes them tick.

Then I might understand…

  • Is this customer contemplating a big ticket purchase?
  • Is this customer likely spending with my competitors?
  • How can I move a purchase they are thinking about to my store?
  • Would the customer spend if I advertised to them now?
  • Is my customer able to influence other customers to buy? What marketing does this require?
  • What else will this customer buy?
  • How can I make this customer a repeat customer?
The Privacy Promise

Personally Identifiable Information (PII) and Payment Card Industry Data (PCI) are both heavily regulated… this means any data would need to be packaged in a way that wouldn’t identify one individual or infringe any of their rights.  This is usually done by identifying demographics and postcodes, rather than names and addresses.

Setting up Your First Mine…
To do it well companies need to GRASP data science in the way innovative companies use big data.  Click here for a great article on how one small company uses data science.
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Big Data is a tool that helps you find the unknown unknowns…  By the time most companies understand Big Data, the big opportunities will have gone already!

Focus

  • Start Extracting Value from Big Data Today:  Ultimately the people who know how to help your business grow are internal.  Set-up a session with your analytics team.
  • Identify the KPIs you wish to affect, and the questions you want to answer.  Your Analytics team will already have some great ideas.  Work with them, and help them understand what you need as a decision maker from them.
  • Test / Pilot questions.  Using the example questions in the Retailer examples, what don’t you know, that you would like to know about your business?  Measure success, and shout about it when it comes.
  • Move To Business Case.  Once the concept is proven, and the types of insights are seen the need for this capability will become apparent.  Whilst putting numbers to the ability to answer questions, where you often don’t know the question yet is tough.  I’m sure an investment case can be made for this, if your proof of concept is strong enough.
.What are your thoughts? Have you seen any companies use Big Data well? Have you seen a good business case for Big Data?  Am I a raving lunatic?  Comment, interact, reply!
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Hey Techrunch: This is What’s really happening in Payments in 2011

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So Techrunch have been spending a lot longer looking at Payments lately.  Their high level overviews suggests that they just don’t get it yet.

The article suggests the 5 or flavors of the month in Payments (Facebook, Square, Apple, Google and PayPal) respectively, all have a viable play at the wallet.  Which is [...] Continue Reading…

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