If you’ve looked at the hardware specifications for a top of the line handset at any point in the last few years, there’s a good chance that you’ve seen NFC listed on the spec sheet. But despite the age of NFC, it hasn’t yet become the norm for all smartphones. If you’re content with an older handset, or can’t quite justify springing for the latest top of the line model, you may be wondering what all the fuss is about. So here’s a rundown of what NFC is, how it works, and what it can be used for.

NFC stands for “Near Field Communication” and, as the name implies, it enables short range communication between compatible devices. This requires at least one transmitting device, and another to receive the signal. A range of devices can use the NFC standard and can be considered either passive or active, depending on how the device works.

Passive NFC devices include tags, and other small transmitters, that can send information to other NFC devices without the need for a power source of their own. However, they don’t really process any information sent from other sources, and can’t connect to other passive components.  These often take the form of interactive signs on walls or advertisements.

Active devices are able to both send and receive data, and can communicate with each other as well as with passive devices. Smartphones are by far the most common implementation of active NFC devices, but public transport card readers and touch payment terminals are also good examples of the technology.

How it works

Just like Bluetooth and WiFi, and all manner of other wireless signals, NFC works on the principle of sending information over radio waves.  Near Field Communication is another standard for wireless data transitions, meaning that there are specifications which devices have to adhere to in order to communicate with each other properly. The technology used in NFC is based on older RFID (Radio-frequency identification) ideas, which uses electromagnetic induction in order to transmit information.

This marks the one major difference between NFC and Bluetooth/WiFi, as it can be used to induce electric currents within passive components as well as just send data. This means that passive devices don’t require their own power supply, and can instead be powered by the electromagnetic field produced by an active NFC component when it comes into range, but we’ll talk about that in greater detail some other time. Unfortunately, NFC technology does not command enough inductance to be used to charge our smartphones, but QI charging is based on the same principle.

Electromagnetic fields can be used to transmit data or induce electrical currents in a receiving device. Passive NFC devices draw power from the fields produced by active devices, but the range is only short.

The transmission frequency for data across NFC is 13.56 megahertz, and data can be sent at either 106, 212 or 424 kilobits per second, which is quick enough for a range of data transfers – from contact details to swapping pictures and music.

In order to determine what sort of information is to be exchanged between devices, the NFC standard currently has three distinct modes of operation for compliant devices. Perhaps the most common use in smartphones is the peer-to-peer mode, which allows two NFC-enabled devices to exchange various pieces of information between each other. In this mode both devices switch between active, when sending data, and passive states when receiving.

Read/write mode, on the other hand, is a one way data transmission, where the active device, possibly your smartphone, links up with another device in order to read information from it. This is the mode used when you interact with an NFC advert tag.

The final mode of operation is card emulation, whereby the NFC device can be used like a smart or contactless credit card in order to make payments or tap into public transport systems.

Comparisons with Bluetooth

You might think that NFC is bit unnecessary, considering that Bluetooth has been more widely available for many years. However, there are several important technological differences between the two that gives NFC some significant benefits in certain circumstances.

The major argument in favour of NFC is that it has much lower power consumption than Bluetooth, even lower than the new Bluetooth 4.0 (aka Bluetooth low energy). This makes NFC perfect for passive devices, such as the advertising tags that we mentioned earlier, as they can operate without the need for a major power source.

However, this power saving does have some major drawbacks. Most noticeably that the range of transmission is much shorter than Bluetooth. While NFC has a range of around 10cm, just a few inches, Bluetooth connections can transmit data up to 10 meters or more from the source. Another drawback is that NFC is quite a bit slower than Bluetooth, transmitting data at a maximum speed of just 424 kbit/s, compared with 2.1 Mbit/s with Bluetooth 2.1 or around 1 Mbit/s with Bluetooth Low Energy.

But NFC does have one advantage when it comes to speed, faster connectivity. Due to the use of inductive coupling, and the absence of manual pairing, it takes less than one tenth of a second to establish a connection between two devices, a speed which has only recently been matched by Bluetooth 4.0.

Google Wallet is an NFC based wireless payment system that allows its users to store debit and credit card information to make payments at PayPass-enabled terminal at checkouts.

You may have noticed that NFC based Android Beam, or S Beam on Samsung’s Galaxy handsets, actually uses Bluetooth or WiFi Direct to share information between devices. These two technologies actually only use NFC to quickly link the two devices together. This combination of wireless standards allows for maximum wireless transfer speeds, but without the longer connectivity times associated with Bluetooth.

A standard for the future

With the growth of interactive advertising, contactless payment systems, and the introduction of services like Google Wallet in the US, NFC is the wireless standard best poised to make our smartphones a viable alternative to credit and transport cards.

There are already over 300,000 MasterCard PayPass merchant locations in the US, but there’s still a way to go before NFC adoption rates are high enough for these technologies to become viable on a mass scale. But if a few more budget and midrange smartphones start shipping with NFC, this could be the way that a lot of us pay for our goods in the future.