New RFID in cell phones aims to get access to your social networks

There are several new phones coming out next year that will have RFID stickers on them, enabling you to pay for your purchases with just a swipe of your cell phone. It all sounds convenient until you learn that retailers want access to your cellphones and social networks for marketing purposes.

When users pay for a reservation using the app, which debits funds from a prepaid account, a Facebook post lets friends know all the details: film, theater, and show time. “It makes it more likely that friends will join them at the movie,” says Michelle Fisher, CEO of Blaze Mobile, one of a slew of companies exploring how cell phones that act as wallets can encourage new connections between friends—and between businesses and their customers.

It also makes it more likely that someone will know that they have about 1 hour and 45 minutes to rob their house.

“For retailers, mobile is a critical channel to reach their customers,” he says. “Paying with a phone is not just about payments; it’s about advertising, couponing, and loyalty.”

Bling Nation, a startup based in Palo Alto, California, is already demonstrating how businesses can use customers’ social ties. Like Blaze, the firm distributes stickers that make phones usable for contactless payment. It also taps features provided by Facebook to link each user’s account with his or her Facebook identity.

Thanks to that integration, retailers can use the social network to reach out to selected customers with offers and free gifts. When a person redeems such an offer, an update on Facebook lets friends know. “You can choose your most loyal customers, and those with the most friends, to target with coupons,” says Judy Balint, Bling’s head of business development. Bling transactions are the first of this type to draw money from a PayPal account.

Why the hell do people want this? Why do you want everyone to know every single minute thing that you are doing? Do you really want people knowing every single thing you purchase or receive as a gift for being a loyal customer? Are coupons really worth it now if you need to give up your privacy in order to save a few dollars?

Square makes money by collecting a fee of 2.75 percent plus 15 cents from every transaction, although it must still pass on a portion of that to the customer’s card provider.

Has anyone really thought about this? The retailer must pay a fee to the credit card company. Now they have to pay a fee to these companies as well. Who do you think is going to have to foot that bill?

For that money, Square offers retailers novel features such as a new kind of electronic receipt. Instead of just a scrap of paper, a Square receipt is sent by text or e-mail and can feature a picture of your purchase, information on how many times you’ve visited that store in the past, and a map showing where you made the transaction. Consumers may one day be able to share their receipts on Twitter or on a location-based service, says Dorsey. Interactive receipts could also serve up coupons or other promotions.

Again, why would people want this? Why do you want a store to know how many times you’ve visited in the past or map where the store is? You know where the store is because you visited it.

What are you going to do when you lose your cell phone? Sure, you can notify your provider and have the account frozen. In the meantime, anyone who has “found” your phone can access all your data and copy it before anything gets frozen.

What do you do to protect yourself from phone skimmers? In order to prevent this, you’d have to authorize each transaction, which defeats the purpose of just a swipe of the phone to pay. If you have to type in a PIN or something similar to verify, have you really saved any more time?

Japan, Malaysia, and Belgium have used these for some time, including adding apps to your phone, but it’s relatively new in the US.

I’m going to continue to stick with cash as long as feasible. I don’t have a cell phone, so these technologies are useless to me. It is unlikely that I will purchase any cell phone in the future that has these capabilities. I value my privacy and I don’t need retailers, friends, or family to know my every move and purchase. The only people that care about what underwear I buy is the retailers and that’s too much information on me for them to have.