Understanding Near Field Communication

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  • Understanding Near Field Communication Raghavendra Kamath Technology Consulting Group (TCG)

    ABOUT AUTHOR

    Raghavendra Kamath is a member of Technology Consultant Group. As a Technical Analyst, he is engaged in projects across platforms and OSes. He designs and develops innovative mobile solutions for Endeavours clients. The team looks up to him for ideas & solutions for resolving project problems and finding innovative solutions to develop application features.

    CONTACT INFORMATION Endeavour Software Technologies info@techendeavour.com T: +1 (512) 464 1218

  • 2 2012, Endeavour Software Technologies

    Understanding Near Field Communication

    Table of Contents 1. EXECUTIVE SUMMARY ..................................................................................................................... 3

    2. INTRODUCTION TO NFC NEAR FIELD COMMUNICATION............................................................... 4

    2.1 OPERATING MODES ....................................................................................................................... 6 2.1.1 READER/WRITER MODE .............................................................................................................. 6 2.1.2 CARD EMULATION MODE............................................................................................................. 6 2.1.3 PEER-TO-PEER MODE.................................................................................................................. 6

    3. NFC VERSUS OTHER SHORT RANGE TECHNOLOGIES ........................................................................ 7

    3.1 NFC SECURITY CHALLENGES ............................................................................................................ 8

    4. NFC ECOSYSTEM .............................................................................................................................. 9

    4.1 NFC STAKEHOLDERS ...................................................................................................................... 9 4.2 GUIDELINES FOR STAKEHOLDERS .................................................................................................... 11

    5. NFC USE CASES ............................................................................................................................... 12

    6. NFC AND M-COMMERCE ................................................................................................................ 14

    6.1 MOBILE PAYMENT ....................................................................................................................... 14 6.2 MOBILE PAYMENT STAKEHOLDERS EXPECTATIONS ......................................................................... 14 6.2.1 CONSUMER EXPECTATIONS ........................................................................................................ 14 6.2.2 MERCHANT............................................................................................................................. 14 6.2.3 BANKS ................................................................................................................................... 14 6.2.4 MOBILE DEVICE MANUFACTURER ............................................................................................... 15 6.3 MOBILE PAYMENT BENEFITS ....................................................................................................... 15 6.4 USE CASE SCENARIOS ................................................................................................................. 16 6.4.1 NFC- MOBILE PAYMENT USE CASE: GOOGLE WALLET ..................................................................... 16 6.4.2 LOOK OUT FOR THE SECURITY BREACHES ...................................................................................... 16

    7. FUTURE OF NFC .............................................................................................................................. 18

    8. CONCLUSION ................................................................................................................................. 19

    9. REFERENCES AND ABBREVIATIONS ................................................................................................ 20

    9.1 REFERENCES ............................................................................................................................... 20 9.2 ABBREVIATIONS .......................................................................................................................... 20

    10. ABOUT ENDEAVOUR .................................................................................................................. 21

  • 3 2012, Endeavour Software Technologies

    Understanding Near Field Communication

    1. Executive Summary This whitepaper introduces Near Field Communication (NFC) and briefly illustrates the concept of mobile payments using NFC. In brief, NFC is a contactless communication technology based on the wireless short-range communication. The NFC technology is expected to simplify everyones lives, with ease of making transactions, exchanging content, making payments, doing shopping, redeeming loyalty points, etc. the list is endless. As per GigaOMs research, forecasts and findings about NFC & NFC equipped devices:

    - By 2015, the worldwide sales of NFC-equipped handsets will reach 263.6 million units, with the cumulative total at more than half a billion compatible devices.

    - More than 6 million people around the world are expected to be using NFC for mass transit ticketing by 2015. This is due largely to the fact that many transportation systems already have NFC/RFID infrastructure in place.

    - NFC also faces competition from bar codes, particularly the QR code. QR codes are very inexpensive to produce and include on existing products such as advertisements. Strong growth of QR codes may impede the progress of NFC deployment for nonpayment applications.

    This whitepaper compares NFC with its counterpart short range technologies. Further, the paper gets into the details of NFC Ecosystem, who are the key stakeholders and what their role is in promoting NFC adoption as well as implementation. The topic gets further detailed with description of how NFC technology can be leveraged in making mCommerce more successful.

  • 4 2012, Endeavour Software Technologies

    Understanding Near Field Communication

    2. Introduction to NFC Near Field Communication Before jumping onto the details of NFC, let us understand NFC Forum. NFC forum is a non-profit organization which promotes the NFC concept & its implementation. It assists in:

    - developing the standards based specification - promoting the NFC technology among the contributors - validating the NFC based development - educating the users about its implementations

    As NFC Forum defines, NFC is a standards-based connectivity technology; NFC harmonizes today's diverse contactless technologies, enabling current and future solutions in areas such as access control, consumer electronics, healthcare, information collection and exchange, loyalty and coupons, payments, and transport.

    NFC is not a new technology and has had its implementations in transport systems in Europe for almost 8 years, but it has gained a lot of visibility in recent times in lieu of its capabilities to support payments. It uses magnetic field induction to enable communication between electronic devices in close proximity thereby enhancing the security of the transaction. NFC leverages RFID technology and provides a secure medium via identification protocols which ensure secure data transfer.

    Technical Specifications of NFC:

    Operating frequency: 13.56 MHz Data transfer rate: 424 Kbps Operating Range: 4 to 10 centimeters ISO/IEC, ETSI, ECMA based standard used to exchange data

  • 5 2012, Endeavour Software Technologies

    Understanding Near Field Communication

    The following diagram illustrates the steps for data exchange leveraging NFC technology:

    Step 1: NFC allows for a simple data exchange between two devices by way of a physical touch.

    Step 2: NFC requires an initiator and a target

    Step 3: The initiator generates a Radio Frequency

    (RF) field with a range of about 4cm. Step 4: The Target Picks up the RF field and

    receives the data it contains.

  • 6 2012, Endeavour Software Technologies

    Understanding Near Field Communication

    2.1 Operating modes

    NFC technology covers the basic usages like sharing an image to the advanced levels like mobile payments. NFC supports three operating modes as shown in the below diagram.

    Each mode works on a different communication layer and data transmission as the specification defined by NFC forums. The NFC forums architecture defines the data exchange between application and different modes

    2.1.1 Reader/Writer mode One NFC device acts like an initiator and another one as a target to transfer the tag. The tags are transferred from initiator to other NFC reader (POS) device.

    2.1.2 Card Emulation mode In this mode, the NFC mobile device emulates as a smart card. The secure element on the device communicates and exchanges data with an external reader. The mobile device communicates with the contactless infrastructure installed at merchant places. The secure element may access a wallet application to get the credit card information for payment purposes. This will be covered more in the NFC and m-Commerce section.

    2.1.3 Peer-to-Peer mode The common usage may be connecting cameras (to share photos), laptops, and special medical devices, configuring Bluetooth devices, WIFI, etc. Thi