Near Field Communication Today and Tomorrow

Posted by on June 28, 2012
Near Field Communication Today and Tomorrow
NFC technology is being increasingly adopted in many various industries, turning your mobile device into an all-in-one replacement of bank cards, travel tickets, and parking cards. This article discusses a few possible uses of NFC which are likely to gain more and more popularity in the near future.

Today

Today a mobile phone is more of a small computer with extra sensors such as cameras, GSM, Bluetooth, Wi-Fi, IrDA, etc. Much more than just a communication device, a smartphone has also become a personal identifier always at hand. It’s only logical that you should be able to conduct payments via your mobile phone as well. Near Field Communication (NFC) is a technology allowing you to do just that.

Created specifically for wireless high-frequency short-range communications, NFC provides data exchange between devices at a distance of several centimeters. It combines the interface of the smart card and reader into one device, allowing users to quickly exchange contact or video between two smartphones or make a mobile payment (thus replacing credit cards) with a single touch. This way the absolute compatibility with the existing infrastructure of contactless smart cards, which have been already used in buses, subways and payment systems, is achieved.

The development of NFC technology is largely influenced and furthered by the NFC Forum, but other industry players contribute as well. Thus, the global trade association for mobile operators GSM Association (about 800 operators, represented in 219 countries around the world) has filed two important initiatives regarding the NFC:

  • Mobile NFC Initiative. As a part of this initiative, the basic operators which control almost half of the global market describe their vision of NFC technology.
  • Pay Buy Mobile Initiative. Operators are trying to determine a global approach to using short-range communications technology in mobile devices in order to interact with payment systems.

Another organization involved in NFC development is a European consortium StoLPaN (Store Logistics and Payment with NFC). It was established to explore the opportunities for the integration of NFC, wireless communication, and mobile information exchange.

NFC technology is based on the existing RFID standard. The main difference between the two is that NFC has a limited range. While the distance readout of active RFID-tags can reach several hundred meters, NFC tags are available only in the range of up to 2 inches (about 6 centimeters). The operating frequency of a NFC-chip is in the unlicensed radio frequency ISM band, used for industrial, medical and scientific purposes, and equals to 13.56 MHz, while the data transmission rate can be equal to 106, 212 or 424 Kbps.

NFC supports the RFID standards ISO 14443/Mifare, FeliCa and ISO / IEC 18092, which means it is compatible with the existing infrastructure of transport cards and mobile payments used in the US, Europe, China, and Japan.

The NFC Forum has identified three communication modes for NFC-chips:

  • Peer-to-Peer mode. In this case, the two devices communicate to exchange information with each other. With the help of p2p, contacts are transferred between smartphones with NFC-chips. Settings from a Wi-Fi-router on a mobile device can be transferred as well (yes, this is possible too!). This mode can be combined to create smartphone multiplayer games.
  • Reader/Writer mode. In this mode your phone acts as a scanner for modern analogues of bar codes – NFC tags containing some additional information. Lately, NFC-labels have been increasingly replacing bar codes on food products in supermarkets (for customers to be able to quickly find out the expiration date and composition) as well as on billboards providing promotional information.
  • Card Emulation Mode. This is the mode allowing card emulation so that your mobile phone can “pretend” to be a credit card or a subway travel ticket. After the release of Google Wallet this mode is the most widely discussed one.
Near Field Communication Modes

Tomorrow

NFC technology is being increasingly adopted in many various industries, the most authoritative analysts recognize it as a very promising market and predict a strong growth for NFC over the next few years:

  • According to the analysts of IMS Research, NFC integrated circuits shipments are to reach 920 million in 2015.
  • According to Juniper Research, the value of NFC-enabled transactions will triple by 2015 to reach $74bn.
  • Berg Insight forecasts that by 2017, NFC enabled point of sale terminals will have increased globally from 3.9 now to 43.4 million.
  • Deloitte predicts that in 2012, shipments of devices equipped with near field communications (NFC) capabilities will likely grow about 100 percent to almost 200 million with as many as 300 million NFC smartphones, tablets and eReaders to be sold in 2013.

The NFC chip (accompanied with the appropriate software) may turn your smartphone into an all-in-one replacement of bank cards, travel tickets, discount cards and smart card access, movie tickets and parking cards. Let`s consider a few possible uses of NFC which are likely to gain more and more popularity in the near future:

  • In Japan and South Korea, the Japanese KDDI, Softbank and Korean SK Telecom implemented support for NFC in ATMs, shops, restaurants, taxis, car service stations – still in a test mode, though. The DoCoMo company in collaboration with Korean corporations, announced the development of an international reservation system with NFC support.
  • Manufacturers of mobile devices are increasingly embedding NFC chips. NFC will soon appear in laptops and netbooks. At a BUILD conference, Microsoft announced that the upcoming operating system Windows 8 will support NFC. The tablets with Windows 8 pre-installed that were presented to visitors already had NFC chips embedded as well.
  • With the adoption of NFC technology, interactive advertising boards (smart posters) will become more popular.
  • NFC technology can help greatly accelerate the initialization of Bluetooth-connection between mobile devices: smartphones will be able to establish a connection within milliseconds versus about the six seconds that it takes now.
  • In the more distant future the prevalence of NFC smartphones may replace your house and car keys. The same will be true for rental cars and apartments. By the way, some car manufacturers (e.g. BMW) are already engaged in the development of keys utilizing NFC technology.

Security

The main challenge slowing Near Filed Communication technology adoption is mobile security. The risk of your mobile phone being lost, stolen or attacked by malware becomes even more serious when your bank account or house safety is at stake. A lost NFC RFID card or smartphone is only protected by a PIN code and may open access to any finder if this PIN code is broken.

At present, NFC technology does not offer reliable protection against Man-in-the-middle attacks and may be vulnerable to data leakage or modification:

  • Eavesdropping, when the RF signal for the wireless data transfer is picked up with antennas.
  • Data modification, which can be detected if your NFC device checks the RF field while sending the data.
  • Relay attack, which is similar to a Man-in-the-Middle attack: the malefactor forwards the request of the reader to the victim and relays back its answer to the reader in real time, pretending to be the owner of the victim's smart card.

The possible way out is to apply higher-layer cryptographic protocols such as SSL. Users also should take their own precautions in order to protect their personal information:

  • Secure your smartphone with a reliable password including not only letters, but symbols as well.
  • Protect your smartphone with anti-virus software.
  • Transfer sensitive data via secure channels only. Encrypted information is very difficult to crack, thus the malefactor probably won`t be able to use it.
  • Remember about the limited range of 6 cm necessary for the data transfer. The malefactor will need to be very close to you, so keep your eyes open.
 
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