Google Wallet, another mobile payment system launched a year ago, relies on NFC and cab used in several Android phones. Some Android phones, such as the Galaxy S III, only use the NFC chip to make quick data transfers between phones.
Isis, a consortium made up of wireless carriers AT&T, Verizon Wireless and T-Mobile USA, is planning to launch a mobile payment system based on NFC in Salt Lake City and Austin, Texas, later this year. Isis defends NFC as the most scalable and secure of mobile payment approaches.
In addition to Oglesby, other analysts said Apple made the right choice to include NFC in the iPhone 5, saying the hardware would have taken up internal space when Apple was trying to make its thinnest and lightest iPhone to date.
"In a move to increase functionality in the device, clearly LTE was the first priority and more important than NFC right now," said Jack Gold, an analyst at J. Gold Associates. "NFC does take up space and resources in the phone, so they would have had to perhaps make the device somewhat thicker or have had less space for battery. Even though NFC is only a chip, it also requires an antenna that could interfere with others in a highly compact device."
Gold said Apple doesn't face any urgency to provide NFC now. "NFC has taken off very slowly and will likely take at least a couple more years to catch on," he added.
Carolina Milanesi, an analyst at Gartner, added that "consumers are not jumping up and down to get NFC right now." Many U.S. consumers still write checks, a predecessor to credit cards, she noted. "You wonder how ready consumers are for mobile payments."
"There's no real pressure right now in delivering NFC," Milanesi added. "The ecosystem is far from ready from a payment perspective. This doesn't mean Apple is not interested in NFC. They will do it when they can take advantage of it and deliver a differentiated solution to users."