CUPERTINO, Calif. - Apple is moving into the mobile payment arena with its development of a microchip that facilitates payments between an iPhone and a retailer€™s reader, Newsweek reports.
The near-field communication (NFC) technology allows data to be sent across distances of around 4 inches, such as from a smartphone to a reader. Richard Doherty, research director at Envisioneering Group, thinks Apple will place NFC chips into the next generation of iPhones and iPads.
Doherty sees Apple€™s move as what something that could transform mobile commerce. Sources tell Doherty€™s firm that the tech company is working on its own version of a mobile-payment system.
Other companies have been investigating NFC chip technology. For instance, Nokia and Sprint have shipped phones with technology for mobile wallets, and Starbucks recently announced it could accept mobile payments from Blackberry and Apple iOS users.
For Apple, what€™s at stake is the fees it pays to credit card companies and PayPal to process payments at its iTunes Store, where users buy apps, books, movies and music. "When NFC meshes with iTunes, the world suddenly changes," said Doherty.