NFC chip supplier Inside Secure has announced support for a new category of low-cost but nonstandard RFID tags that it said could be used in place of standard tags to send data to NFC phones.

The tags, called “RF barcodes” by their maker, Silicon Valley-based Kovio, could be attached as “smart labels” to product packages and to smart posters in stores to enable consumers to receive product details, promotional offers, coupons, loyalty points and nutritional information by tapping their NFC phones on the tags. In-store mobile promotions are among the most anticipated uses for NFC tags.

The Kovio tags are not actual bar codes, but printed integrated circuits that send data using the ISO/IEC 14443 standard frequency, 13.56 MHz, according to Kovio. It is targeting the market for bar codes on product packages and also low-cost transit fare and entertainment venue tickets. The tags are also used for inventory tracking. At volume production, the company said the tags could be produced at 5 U.S. cents or less apiece, which would be significantly lower than standard NFC tags.

“They can be manufactured with very short lead times–this is the key difference in the silicon ink versus silicon foundry techniques,” Charles Walton, chief operating officer for France-based Inside Secure, formerly Inside Contactless, told NFC Times. “They’ve (Kovio) commercialized very quickly and at a very low cost, these devices. They are a very reliable, very elegant, cheap simple solution.”

Both the Kovio tags and standard NFC tags could store small amounts of data, such as URLs or SMS codes that could open mobile Internet connections on NFC phones, enabling consumers, for example, to access product information or coupons.

Update: Kovio’s vice president of business development, Vik Pavate, said consumer product companies will not put conventional RFID tags on millions of different types of products because the tags are too expensive–he contends they are stuck at a 10- to 15-cent price point apiece.

“The conventional silicon platform is not capable of getting to where we are now,” Pavate told NFC Times. “In the context of brand promotion, it’s like a Ferrari–very expensive. No brand company will make an investment at the price of conventional silicon. They’ve (silicon manufacturers) been talking about getting down to 5 cents for years.”

Without affordability, there will be no widespread tagging of products in stores. And that would greatly reduce the marketing and advertising reach of product makers and merchants, as they try to interact with consumers on NFC phones, he said, adding that Kovio’s goal is to reduce the price of its tags to a penny apiece in a few years. End update.

Nonstandard Technology
But while the Kovio tags support the standard contactless radio frequency, they are proprietary and do not comply with any of the four tag types standardized by the NFC Forum.

Walton acknowledged it would require what he termed “slight modifications” to Inside’s MicroRead and SecuRead NFC chips to read the Kovio tags.

For NFC phones using other NFC chip makers’ products to read the Kovio tags, those chip makers would also have to make modifications, after concluding agreements with Kovio.

Inside points out its NFC chips are able to read standard NFC tag types as well, but its promotion of nonstandard tags is unlikely to sit well with the NFC Forum, a standardization and trade association. While the forum’s four standard tag types are manufactured or licensed by private companies, Broadcom, NXP Semiconductors and Sony, their inclusion in the standard means that NFC Forum-certified phones should be able to read them without modification to the NFC phone chips.

“Standards make life easier to create growth in the market much faster,” Jeff Miles, director of mobile transactions for NXP, told NFC Times, when told of the Inside announcement.

Kovio is itself a member of the NFC Forum, and Inside hopes the company’s tags one day will become part of the standard. That is possible, though it would create a fifth tag type.

Update: When asked by NFC Times whether it viewed a possible rollout of nonstandard Kovio tags a potential problem, and if it would consider standardizing the technology, NFC Forum Chairman Koichi Tagawa responded only that the forum is a “member-driven organization,” and as such, “we have a process in place for members to propose new technologies for the forum’s consideration.” End update.

The Kovio tags are on display this week at the International Computer Electronics Show in Las Vegas.

Kovio’s Pavate said the company has raised $85 million in venture capital.

Tom Zind contributed to this article.

At the 40th annual Consumer Electronics Show, attendees are displaying credentials to enter the show floor where they are busy swapping business cards, collecting product brochures and buying coffee to keep going through the endless rows of company exhibits. Simultaneously, Nokia is announcing the world’s first fully integrated, commercial NFC handset, the Nokia 6131 NFC phone, which will soon allow all of these activities and more to be performed with the simple tap of a phone. Featuring the same slim folding lines and outstanding features, the Nokia 6131 NFC handset includes Near Field Communications (NFC) technology to enable information sharing, service initiation and payment & ticketing capability.

Nokia 6131 – Near Field Communications technology

Used in much the same way as existing contactless cards and keytags to allow access and make small payments, the addition of NFC technology to a full featured mobile device adds an entirely new level of capability by leveraging the phone’s computing power, wireless Internet access and user interface. “At CES there are dozens of potential use cases for the Nokia 6131 NFC phone. Instead of carrying a badge for entry, a tap of my phone could authorize my admittance to the exhibition, access to product information could be achieved by touching my phone on a product display, making carrying brochures around the show floor obsolete, and instead of heading to the ATM machine on a daily basis, coffee, sodas and hot dogs could be purchased using an NFC-enabled phone,” said Juha Kokkonen, director of Mobile Experiences for Nokia’s Mobile Phones business.

Nokia 6131 NFC-enabled mobile phone

“In a trade show environment like CES, one of my favorite applications is using NFC-enabled business cards. Instead of going home with a pocket full of cards that I have to scan or hand type into my computer, I can simply touch the card, and I have all of the contact information right in my phone.” Unlike a simple card or keytag, which only allows for one-way communication, an NFC-enabled mobile phone allows users to realize the benefits of a fully interactive experience. For example, touching an NFC-enabled advertising poster or informational kiosk can automatically link the user to interactive Internet based information, open an audio file, or download new content directly to the handset. Additionally, an extra layer of security is enabled when making contactless payments since the handset can be set to allow payment information only when the user expressly authorizes the transaction via a password, unlike a card or tag, which can be used by whoever has it in their possession.

Nokia 6131 – MicroSD flash memory card

Along with its NFC features, the Nokia 6131 NFC phone includes an extensive set of today’s most wanted wireless features. A built-in digital music player with microSD card support and FM stereo radio allow customers to enjoy their favorite music on the go. A 1.3 megapixel camera, featuring a dedicated camera button and 8x digital zoom makes it easy to capture and share images. Bluetooth wireless technology enables easy connection to a wide selection of Nokia enhancements and PC’s or even the ability to go handsfree in compatible automobiles. The Nokia 6131 NFC phone is expected to be available in select markets during the 1st quarter of 2007 for approximately $340 (260 Euros) before taxes and subsidies.

Visa and Bank of America are reportedly partnering for a trial program that will allow customers to pay for purchases using only a smartphone. The test program begins next month in New York, says Reuters, and runs through the end of 2010. The mobile transaction market, already embraced by other countries, is starting to accelerate in the U.S., as multiple companies begin to vie for leadership and land-grab the payment processing revenues that come with e-commerce payments.
Niether Visa nor BofA have outlined any details on the trial payment program, but it will likely take advantage of short-range wireless communications offered by near-field communications (NFC) . With a wave of an NFC-equipped phone near a payment terminal, the transaction is processed. Tired of waiting for handset makers to build phones with the proper wireless chips, Visa cleverly worked with Devicefidelity earlier this year to marry NFC chips on the standard microSD memory cards that many modern phones already use. The approach makes sense as it wouldn’t require consumers to purchase new phones just to make wireless payments: a simple memory card swap would be used, which reduces a large barrier of adoption for wireless mobile transactions.
Although Visa appears to have a smart solution, the wireless payment battle is far from over. MasterCard, a key competitor of Visa, spent $520 million this week on DataCash, with plans to expand e-commerce and mobile solutions. U.S. cellular carriers are also stepping into the ring by attempting to standardize payments made through their networks. The big elephant in the room may be Apple, however. Armed with hundreds of millions of credit card accounts in 90 countries through its iTunes Store, Apple has near-field communications patents that could help it do an end-around the traditional banking companies and earn a small percentage of mobile transactions. Every wave of an iPhone could be a wave goodbye to the processing fees that Visa, MasterCard and others have built their business upon.

Near Field Communication or NFC, is a short-range high frequency wireless communication technology which enables the exchange of data between devices over about a 10 centimeter (around 4 inches) distance.

What is NFC software?

Near Field Communication or NFC, is a short-range high frequency wireless communication technology which enables the exchange of data between devices over about a 10 centimeter (around 4 inches) distance.[1] The technology is a simple extension of the ISO/IEC 14443 proximity-card standard (proximity card, RFID) that combines the interface of a smartcard and a reader into a single device. An NFC device can communicate with both existing ISO/IEC 14443 smartcards and readers, as well as with other NFC devices, and is thereby compatible with existing contactless infrastructure already in use for public transportation and payment. NFC is primarily aimed at usage in mobile phones.