With an impressive array of business, credit, metro, and various loyalty cards bursting out of our expanding wallets, a move to digitize plastic cards may come as a pleasant reprieve to many. Earlier this month, Bloomberg uncovered a planned venture between AT&T, Verizon, and T-Mobile to develop a smartphone based payment system designed to compete directly with credit card companies. Using a technology known as NFC (Near Field Communication) embedded into mobile phones; payments would be made by holding the smartphone over a special reader that can communicate with the phone. This method differs from RFID technology, which doesn’t allow two-way communication between devices that would, say, allow for a password to be entered before a payment can be completed. While Visa and MasterCard have invested in their own mobile payment systems, the new venture, which includes Discover Financial Network and Barclays, will place phone carriers and smartphones at the center of a new financial network.
The idea of extending the functionality of smartphones is nothing new. Transit systems around Europe and Asia have experimented with mobile payment systems for years. Functionalities from contactless payment cards, such as London’s Oyster card, have long been embedded into mobile phones and used for transit, parking, and food purchases.
Another plastic card smartphones could replace is the hotel key-card. Via a system developed by OpenWays, guests at select Holiday Inn locations will be able to enter their rooms using an iPhone, BlackBerry or Android based phone. Hotel guests will register with the hotel before arrival and download an application that will provide them access to their designated room upon arrival.
As smartphone capabilities expand and as our wallets become lighter, many other smartphone functionalities may soon become a reality. In the near future, our phones could replace our car and home keys, and even our ID cards. Until then, it’s probably a good practice to get in the habit of not forgetting your phone anywhere – or ever running out of batteries.