Omitting NFC in the iPhone 5 could be a Fatal Mistake to Apple

iPhone5-NFC-Apple-rfid-blogWhile some time ago, leaked photos of purported iPhone 5 parts showed a mysterious square chip which originally believed to be an NFC chip, not long after that, new rumors suggested that there will be no NFC chip in iPhone 5, since the metal back will seriously block the signal from reaching the chip.

Right now we don’t know whether the rumors are true or false, however, skipping NFC in the iPhone 5 will cost Apple dearly.

Above all, NFC plays an important role in mobile payments. Although there are two potential alternatives — Bluetooth Low-Energy and QR code based tokens, neither of them are as fast and convenient as NFC. Replacing wallets with something digital is just a matter of time, for people are always seeking more convenient, efficient and secure ways to pay. Thus, using smartphones would be a good choice. With a big name, Apple could be the choice of most people.

Although NFC is still far from prevalent for the time being, Apple has the power to make it mainstream. Apple already has over 400 million active credit card accounts on file, so if Apple’s users link them to a mobile payment system tied to the iPhone, it would greatly push forward the technology.

Using NFC payments would work like direct mobile billing, allowing you to charge a payment to your mobile account which then appears on your monthly carrier bill. Apple could do something similar with iTunes, so that users can charge anything from gas to groceries to the credit card on file in their iTunes account.

Apple now has at least 6 patents related to mobile payments, but the company has indicated that it plans to move slowly on mobile payments. It seems Apple likes to let its competitors do their market research for them.

However, doing so requires Apple a lot of money. Why would Apple intentionally avoid such a lucrative business when it already has 250 million iPhones in people’s pockets and 400 million credit cards on file?

All in all, omitting NFC in the iPhone 5 could be a fatal mistake for Apple. It would lag it a year behind Android devices that already contain NFC functionality and severely cripple Apple’s promising PassBook app in iOS 6.

But maybe there’s still hope. Whether Apple will respond to the majority’s expects or go its own way, let’s just wait for the final answer.