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My Top Innovative Technology for 2012

From advanced touchscreen displays, voice activation in mobile devices and motion control, 2012 promises to see bigger and better advances in cutting-edge technology.

But there’s one technology in particular that’s at the top of my list. And it boasts such potential that I feel it deserves our undivided attention.

Near-Field Communication (NFC).

If you’re unfamiliar with the technology, NFC chips essentially allow two electronic devices to interact. And the most popular application that’s sure to gain more traction in 2012 is the technology’s ability to turn your smartphone into a mobile wallet.

At the moment, there are several players jockeying for position in the mobile payment space, but in this two-part mini-series, I’ve boiled the list down to the top two contenders and – better yet – the two best ways to profit as interest in the space heats up.

Today, the contenders. And on Monday, the profiteers.

The Biggest Players in the Mobile Payment Market

When it comes to the genuine NFC contenders, we’re talking about the powerhouse wireless companies, which have the market proliferation, brainpower and funding to make it happen. Companies like these…

~ Contender #1: The ISIS Trifecta

Since NFC chips are stored in smartphones, it makes sense for mobile carriers to build payment platforms of their own.

Verizon (NYSE: VZ), AT&T (NYSE: ATT) and T-Mobile are doing just that. They’re collaborating on a mobile payment venture called ISIS.

As you might expect, an undertaking of this nature takes time and the platform is still in the development stage. However, it’s projected to launch in mid 2012. And with the top three U.S. mobile carriers backing it, ISIS certainly has potential as the mobile wallet industry kicks into high gear.

Plus, all three companies have already laid a solid foundation by inking deals with the major credit card companies. So when ISIS does launch, it should hit the ground running.

~ Contender #2: Google Wallet

Up against the ISIS trifecta… Google (Nasdaq: GOOG).

And while you might think three versus one isn’t a fair fight, Google’s NFC payment service – called Google Wallet – is the only widespread mobile payment application available at the moment.

Unfortunately, Google has experienced a big roadblock, with Verizon reportedly having to iron out security issues with the technology before allowing customers to access the app. That’s partly why the service hasn’t yet fully launched nationwide, despite Google unveiling it in May.

However, it’s still my top pick for mobile payment applications in 2012. Why?

Because Google didn’t just focus on storing your credit card information on a phone. The company also integrated loyalty cards and coupons into the application and boosted security (no matter what Verizon claims).

For example, while using Google Wallet at a coffee shop, you don’t need to dig through it for your credit card, coupon and loyalty card that will get you a free latte. It’s all stored on the device and activated at the point of sale.

Superior service or not, though, ISIS promises to be a serious competitor to Google Wallet next year. And I expect both services to be wildly popular as more consumers get their hands on devices with NFC baked in.

Naturally, there’s a way for us to play this fast-growing trend: By zeroing in on the companies poised to reap the benefits of NFC technology, no matter which platform comes out on top in 2012.

And in my column on Monday, I’ll reveal the top two candidates. Until then, have a great Christmas weekend.

Good investing,

Justin Fritz

Justin Fritz

, Executive Editor

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