iPhone 5 to Sport NFC Controllers, Rival Google Wallet: Report

Apple's latest iPhone could boast near-field communication (NFC) technology, putting the company's mobile payment Passbook in direct competition with Google's Wallet app.

Another day, another rumor about Apple€™s hotly anticipated iPhone upgrade, casually referred to as the iPhone 5. This time, the scuttlebutt relates to near-field communication technology that could see the latest edition of Apple€™s lauded smartphone compete with Google€™s wallet service and Microsoft€™s Windows Phone devices, which will offer their own NFC experience, Apple-centric blog 9to5Mac reported.

The report cited data pulled from PreEVT iPhone 5,1 and iPhone 5,2 prototypes. The article stated, €œFurther investigation into this hardware code dump leads us to believe that these iPhones also have near-field communication controllers directly connected to the power management unit (PMU).€

Near-field communication is a set of standards for smartphones (or any mobile device) to establish radio communication with other NFC-enabled devices by touching them together or bringing them into close proximity.

The technology allows for contactless payment systems, which would theoretically replace credit cards and electronic ticket smartcards with mobile payments, which could make it more of a hassle to lose your smartphone than your credit card. NFC has applications beyond mobile payment, however. Users could share photos or other information on social media sites like Facebook, or the technology could even replace the pairing step of establishing Bluetooth connections or the configuration of WiFi networks.

Apple€™s Passbook application stores users' boarding passes, movie tickets, retail coupons, loyalty cards and the like to one place. The user can scan the iPhone or iPod Touch to check in for a flight, get into a movie or redeem coupons. The app also lets users check for specific seats, determine when coupons expire, and balance cards that are running low on credit.

Passbook also includes time and location technology, so passes and tickets show on the lock screen when and where they are needed. So long, folded airline boarding passes.

Apple is by no means alone in developing applications to leverage NFC. Its arch-rival Google offers Wallet, which allows its users to store credit cards, loyalty cards and gift cards, and also leverages coupons and other product promotions. Released in 2011, the application will be available on as many as 10 new Sprint Android-powered smartphones this year. Wallet's profile should also get a boost from AT&T, Verizon Wireless and T-Mobile's forthcoming Isis mobile-payment joint venture.

That service, announced at this year's Mobile World Congress (MWC) convention in Barcelona, Spain, is a mobile commerce joint venture created by AT&T Mobility, T-Mobile USA and Verizon Wireless. At the conference, it was announced that Chase, Capital One and Barclaycard had entered into agreements with Isis, enabling their credit, debit and prepaid cards to be placed into the Isis Mobile Wallet. The program will go live this year in field tests in Austin, Texas, and Salt Lake City.