What Google's NFC Android phones will mean for you

Grab your hoverboards, gang: The next generation of Android phones is on the way, and it's going to feel a bit like something out of Back to the Future II.

Google CEO Eric Schmidt gave us a sneak peak at what's in store for Android's newest handsets during a session at the Web 2.0 Summit on Monday (video here). In addition to providing a few new clues about the hotly anticipated Android Gingerbread release, Schmidt revealed that upcoming Android devices would include support for something called Near Field Communication.

Near Field Communication -- better known by its acronym, NFC -- uses a combination of hardware and software to let you essentially turn your phone into a wallet. Future Android phones will have NFC chips built in, Schmidt said, and the Android Gingerbread release will provide the software needed to allow them to function.

So what's this NFC stuff all about, and how will it actually work with Google Android smartphones? Here's a quick primer on what you can expect.

Google's NFC Android phones will let you make contact-free payments.

One of the primary ways NFC will be used within Android will be as a mobile payment system, Schmidt says. Thanks to the chips' short-range wireless capabilities, an NFC-enabled smartphone will allow you to simply wave your device in front of a retailer's sensor and have your purchase immediately placed onto your credit card or banking account. It's something Schmidt refers to as a "tap and pay" method of purchasing -- and its impact could be enormous.

"This could replace your credit card," he says.

Google's NFC Android phone-based payments should be secure.

Schmidt and others contend that having your payment system on your phone is actually more secure than carrying it around on a piece of plastic, as it provides a greater level of authentication. And rather than imprinting your account number on a easily readable card, an NFC-enabled device keeps it encrypted and password-protected inside the phone.

"The credit card industry thinks that the loss rate is going to be much better. They're just fundamentally more secure," Schmidt says.

Google's NFC Android phones will allow you to retrieve information.

Google's NFC-enabled Android phones won't only be about commerce: The systems will also allow you to "check in" with sensors around a city to instantly load information onto your device.

During his demo, Schmidt tapped a phone to a specially marked Google Places placard. It immediately caused location information to pop up on his Android handset. The same principle could be used to exchange information with retailers or other smartphone users.

Google's NFC Android phones could work as keys.

A Swedish company is currently testing the use of NFC-enabled smartphones as hotel keys. As reported by PCWorld earlier today, the system lets guests "check in and receive [their] key directly onto their mobile phones" before ever setting foot in the building. Similar usages have been envisioned for ticket processing -- and all of this is likely only the tip of the iceberg.

"People don't understand how much more powerful these devices are going to be," Schmidt says.

Of course, it's too soon to know exactly what other usages might appear. Even Schmidt himself admits the idea is simply too new to predict what types of applications Google and others will invent.

NFC technology isn't just for Android.

While Google's NFC vision is taking center stage right now, other smartphone companies are taking steps toward implementing the technology, too. Nokia has said it plans to have NFC-ready Symbian phones on the market by next year, and rumors have pointed to Apple quietly developing an iPhone-based NFC implementation for some time.

America's mobile carriers are getting on-board with NFC as well. Earlier today, AT&T, Verizon Wireless, and T-Mobile announced the formation of a joint mobile commerce network that'll be structured around NFC technology. The network, called Isis, will encourage retailers to provide NFC support in their businesses.

Ultimately, that retailer support may be key to NFC's success. No matter how many phones offer NFC and how cool it seems in theory, if stores don't have the sensors to enable mobile payments, it won't do much good in the real world.

Still, the first steps are underway, and the next few years hold plenty of potential. Or, to borrow a phrase from a certain wise scientist: Great Scott! The future looks bright.

JR Raphael is a PCWorld contributing editor and the author of the Android Power blog. You can find him on both Facebook and Twitter.

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