Samsung Galaxy S2 and iPhone 5 to Give Phone Companies Control Over Customers Finances?

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By Vincent Funaro, Christian Post Reporter
January 13, 2012|4:48 pm

NFC (Near Field Communications) technology can either become a great way to conveniently purchase items or a way for phone companies to control their customers finances, according to critics of it such as PCMag columnist John C. Dvorak.

NFC is featured on some of the latest Android devices including certain variants of the Samsung Galaxy S2 and the Galaxy Nexus with Ice Cream Sandwich software. It will also reportedly make its way to the world’s most popular smartphone, the iPhone 5 once the next generation version is released.

NFC will allow users to turn their smartphone into a credit/debit cards and make purchases simply by scanning or touching their phone to another device. According to Dvorak, this idea originated with a different technology that became relegated to ear pieces and speaker systems connecting to phones known as Bluetooth.

“Bluetooth was invented in 1994 and gave rise to a lot of speculation regarding its usefulness,” wrote Dvorak in his editorial piece titled iPhone Users are about to be Screwed Over. “For a few years, all sorts of futuristic uses were imagined and a serious discussion of the so-called PAN (personal area network) began, but never went anywhere.”

PAN was something Bluetooth would bring to the world of technology allowing retailers to inform consumers about sales bargains and events by communicating to them through some kind of device.

“You’d walk into Walmart and your name would be displayed a computerized sign to greet you as an old man pointed at the sign and then pointed at you in some creepy manner,” he wrote.

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Upon checking out, payments would be made using Bluetooth and physical cash would become obsolete. However Bluetooth never ended up being used for this type of activity due to poor marketing, according to Dvorak. But in the 1990s smartphones did not exist. It seems in today’s day and age the market has become more advanced and a new technology has revived an idea similar to PAN known as NFC.

With NFC, phone companies hope to turn smartphones into credit cards which seems like such a “good idea” at first. But this “good idea” could be allowing these phone companies to have access to too much information.

“But this “good idea” isn’t about the convenience of paying with a phone swipe, but the idea of running your tab through the phone company,” wrote Dvorak. “If you think your banker is a gouger with dubious fees and no-leeway, what you think the phone company will be like?”

Every purchase made by a consumer using NFC will result in the phone company learning more and more about their shopping habits. It is also a perfect place for thieves to run scams. By turning a smartphone into a payment device hackers can easily gain access to cash and credit that does not belong to them.

“A few things to point out, your cash is just that cash if someone wants it they have to pick your pocket, credit/debit card same thing,” wrote Buddah Bless in a forum on dslreports.com titled “NFC good invention, on the top of the bad idea list.” “With NFC on a phone the ways to hack in and steal your payment info are too simple.”

Another issue proposed with NFC would be security. What if an NFC device was misplaced and found by another person? Could that person access the owner’s information?

NFC is only supposed to make purchases while being in short-range contact with another device. But while being in the range of another device can other fees somehow appear when making a purchase? These types of fees would include promotional and convenience ones.

NFC’s radio frequency used to transmit signals is similar to RFID technology. It has been proven that thieves looking to obtain someone’s information with RFID can easily do so by walking closely behind them and running a scan.

Experts have stated that the safety of this technology cannot be gauged until it is fully operational in the public arena. With the next iPhone's release NFC should become a lot more common. It will also be featured in some of the new Blackberrys as well.

 

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