Technology

Hewlett-Packard Said to Plan Devices That Make Wireless Payments


The company is considering introducing phones and tablets based on near field communication technology

(Bloomberg) — Hewlett-Packard Co. is developing mobile devices that will help consumers make purchases wirelessly, two people familiar with the company's plans said.

The company is considering introducing phones and tablets based on near field communication technology, which lets users pay for items and receive coupons and loyalty points by tapping the gadgets on posters and grocery store cash registers, said one of the people, who requested anonymity because the plans haven't been made public. The first NFC devices may be available by year-end, the person said.

Hewlett-Packard, which bought Palm Inc. for $1.2 billion in 2010, is adding the feature to help keep alive a brand that's losing ground in the market for smartphones. Palm's share dropped to 2.6 percent in the three months that ended in April, from 3.2 percent in the previous period, researcher ComScore Inc. says. The company won't release a new device that can vie with Apple Inc.'s iPad tablet until July.

"Other folks are going to build this capability into devices, so, competitively, HP needs to do that," said Ed Finkler, an independent programmer who has created an application for devices that run Palm's WebOS operating system.

Third-party developers will be able to build apps and services using the capability, one of the people said.

Leslie Letts, a spokeswoman for Palo Alto, California-based Hewlett-Packard, declined to comment.

Hewlett-Packard said this week it will start selling its TouchPad in the U.S. in July. The tablet will compete with rival products from Apple and machines that feature Google Inc.'s operating system.

Losing Share

Gartner Inc. projected in April that devices featuring Palm's WebOS software, such as the TouchPad, will hold 3 percent share of the global tablet market in 2015, from 4 percent this year.

NFC is emerging as a must-have feature for mobile devices. Google and ISIS, a joint venture among wireless carriers AT&T Inc., Verizon Wireless and T-Mobile USA Inc., will soon begin testing NFC-based payment and coupon services in select cities. Global NFC-based transactions will reach almost $50 billion by 2014, according to consulting firm Juniper Research.

Rival handset maker Samsung Electronics Co. debuted its Nexus S phone, featuring NFC capabilities, in December. T-Mobile USA began selling Nokia Astound with NFC capabilities in March. Research In Motion Ltd. has said future versions of the BlackBerry will offer built-in NFC support. Users will be able to pair the BlackBerry Bold to an accessory or read information such as a Web link from smart tags by simply tapping the phone to an NFC tag in a poster.

Business customers as well as consumers may flock to NFC technology. Train and bus conductors can use it to check riders' tickets. Warehouse staff can use NFC-enabled devices for inventory tracking, and cashiers can use NFC-enabled tablets to accept payments in retail stores.

"Business could use this capability internally for many purposes," Charlie Bess, a Hewlett-Packard Fellow, wrote in a blog in January. "This can be attached to just about anything and read from nearby."

Kharif is a reporter for Bloomberg News and Bloomberg Businessweek in Portland, Ore.

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