Near Field Communication (NFC) is a set of protocols that enables two electronic devices to communicate over a distance of five millimeters (~0.2 inches) or less. This technology has powered trillions of payment, access, and verification functions. The new 2028 NFC roadmap will continue to make inroads into how the retail industry evolves its customer experience strategy. Retail Mashup explores them in more detail.
Table of Contents
Introduction – NFC in Detail
What is NFC?
The technology was invented by Charles Walton as part of RFID with the patent being granted on May 17, 1983. The NFC Forum was created by telecommunication companies, Nokia, Sony, and Philips 20 years ago to find new use cases to extend this technology in how mobile phone users would communicate (e.g., send short messages between phones, send contact information between phones, etc.)
While mobile phones on the Google Android platform were the first to include appropriate hardware and software functions, it was Apple Inc. that introduced Apple Pay in 2014 that popularized its use in the mainstream retail landscape.
Today, the technology is most used for contactless payments at retail outlets like restaurants and shops, for transit payment, and space access (e.g., hotel room key or airline lounge access).
The market size for using the technology is estimated to go up by more than 15x from US$3.1 billion recorded in 2014 to US$47.3 billion by 2024.
Size of the Near Field Communication market worldwide from 2014 to 2024 (in billion U.S. dollars) Source: Statista
2028 NFC Roadmap
From the NFC Forum press release:
“The NFC Forum, the leading standards body for Near Field Communication (NFC) technology, announced today that it has unveiled its Technology Roadmap outlining key plans and research efforts through 2028. This comprehensive roadmap includes five key initiatives and offers a unique glimpse into the future of NFC, highlighting the technology’s direction and anticipated product development, market, and business opportunities for the next two to five years.
The technology roadmap was collaboratively developed by leading Forum members, including Board representatives from Apple, Google, Huawei, Identiv, Infineon, NXP, Qualcomm, Sony, and STMicroelectronics as well as the Forum’s 400-member company community.
2028 NFC Roadmap
The five key Forum roadmap innovation priorities include:
Increased Power for NFC Wireless Charging. The current NFC Wireless Charging specification offers up to 1 watt of power and plans are to improve these capabilities up to 3 watts. This change will bring wireless power and charging to new and smaller form factors, disrupting industrial design while defining new markets.
Increased Range. Today, NFC connections are limited to a range of 5mm, but the NFC Forum is in the process of examining ranges that are four to six times the current operating distance. Even a modest increase in range would make contactless transactions and actions faster and easier. It would also improve usability by decreasing the precision needed for antenna alignment.
Multiple Purpose Tap. This feature will further improve the contactless user experience by supporting several actions with a single tap. The use cases driving this work include point-to-point receipt delivery, loyalty identification, and total-journey ticketing.
Modernizing Device-to-Device Communication. Designed to empower NFC-enabled smartphones to have Point-of-Sale functionality (SoftPOS), allowing businesses or individuals to receive payments anywhere.
Expanding NFC’s Ability to Share Data Formats Needed for Sustainability.
Enabling NFC to share data on its composition and ways a product can be recycled, helping to meet evolving consumer demands, and regulatory requirements, as well as contributing to a healthy circulatory economy.
“The exponential growth of NFC technology is a testament to our members’ forward-thinking approach and unwavering dedication to innovation,” said NFC Forum Executive Director Mike McCamon. “Through our continuously evolving standards, business-line managers and product designers will be able to create new and exciting products and services that customers will love. As NFC technology becomes more prevalent in our daily lives, our planned features have the potential to significantly enhance the way we pay and receive payments; engage with our favorite brands; power our devices; and access sustainable products and services.”
A little over a year ago, the NFC Forum Board of Directors established a Roadmap Tiger Team to gather and prioritize inputs from various industries and Forum members. Based on their initial findings, the draft roadmap was circulated among members and the Forum’s numerous liaison partners for validation of its assumptions and priorities. After extensive discussions with business and technical stakeholders, it was determined that sharing the roadmap publicly would help generate awareness and interest in this important work.”
Retail Customer Experience of the Future
Currently, to activate the NFC functionalities, users will likely have to take out their mobile devices with the right software and hardware combinations. By 2028, that requirement may be removed (i.e., transactions can occur with the phone hidden away).
In the 2028 roadmap, the technology will prioritize extending the communication range by up to six times the current operating distance. 30 millimeters or 1.18 inches is the goal the Forum wants to achieve. The extended range will enable faster transactions and fewer failed ones. Additionally, there would be better precision.
This would improve how hotel rooms interact with digital keys with increased reliability and speed. Similarly, transit rides could pass the turnstile with ease which would improve throughput.
Multiple Actions with a Single Tap
Another future capability will be supporting more than one action with a single tap. Some of the use cases the forum listed included point-to-point receipt delivery, loyalty identification, and total-journey ticketing.
This means that with a single tap, concert venues, movie theaters, or sports stadiums can validate tickets for more than one person. This would improve efficiency but a significant amount.
Universal Sales Terminal using Mobile Devices
Small businesses and shops around the world would also be able to use their mobile devices on any mobile platform as sales terminals. This would reduce the costs to operate from the more expensive dedicated sales terminal.
The tap feature with Apple Pay has been wildly successful for smaller retailers and shops. Many airlines also use Apple mobile devices as payment terminals to manage onboard service transactions.
Expanding the capability to share data format for sustainability could help retailers manage their environmental goals. For example, a coffee chain can provide information on how best to recycle different types of food wares. An electronic product manufacturer with an NFC chip built-in can engage and inform its customers on when to perform maintenance checks or how to safely dispose of the equipment.
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