Will the Wallet Go the Way of the Buggy Whip?

Pity the poor buggy whip. It has become the, ahem, whipping boy for all who regale others with tales about the perils of technological obsolescence.

The intended point is usually that just as the automobile drove the horse and buggy from the roads, and thereby ended the business of manufacturing buggy whips, so you, too, could be faced with the humiliation of seeing your business tossed into the dustbin of history by some new, new thing.

Similarly foreboding attention is now focused on the wallet. Why the wallet rather than the purse? Indeed. Why the buggy whip rather than the horse shoe? But we digress. Usually overstuffed with assorted evidence of identity validation and commercial viability, the wallet may well be facing extinction thanks to a revolution in electronic communications that renders the presentation of plastic cards ever so 20th century. In other words, the quaint relic of a bygone era.

How close are we to this marvelous future? Mark Henricks reports in BNet on the technology that is enabling the wallet-less world. JL:

“NFC” is the acronym for “near field communications” and it may be the biggest threat to chiropractors in decades. How so? The term is used as shorthand for technology that allows cellphones to communicate with devices such as cash registers. When both the register and phone are NFC-enabled — a situation fast approaching — you don’t need a credit card, ATM card, or cash to make purchases. The phone stores needed data in a secure area and talks to the register wirelessly to seal the deal.

NFC-enabled phones can eventually do the same for driver’s licenses, insurance information, and other identity cards. And that could mean the end of men sitting askew on top of fat wallets crammed in hip pockets.
There’s more potential to the pending NFC revolution. For instance, a string of digits can substitute for a brass key to your home or vehicle. NFC-enabled locks — there are hundreds of thousands already installed on hotel rooms worldwide — can allow you to dispense with your key ring as well.

All this is happening a lot faster than you might guess. In some of the latest survey research, a third of Canadians said they were ready to start paying by phone. The big banks — which may be the ones who really drive this transformation — are getting on board to make it happen. What will the replacement of wallets and key rings by phones mean for small businesses? Here are some ideas:

To begin with, whatever you do to respond, now is the time to steal a march on your competitors, who, like the public, are mostly unaware of what is coming. Big changes don’t happen all that often and you can’t afford to be late on this one.

Security will likely be a huge issue. When you have more of your eggs in one basket, you have to guard that basket more carefully. Innovative providers of everything from encryption technology to device insurance are going to be in demand.

Recreational opportunities tied to NFC also promise vast potential. For instance, one company has a murder mystery game that lets amateur sleuths detect clues hidden around a restaurant, store, or other venue using NFC phones and tags.

This is a great opportunity — perhaps rivaling the introduction of the Internet — to stake out the territory as a middleman between buyers and sellers of everything from concert tickets to groceries. Somebody is going to need to handle these transactions and it could be you.
Beyond these are some more fringe-y opportunities. Will men’s pants pockets go away too? What does that mean for fashion design? For pickpockets? And what about women’s purses? Will they shrink, or will removing billfolds and keys just make room for more items to be carried around? For the wallet makers, key cutters and back adjusters, I don’t have much hope. You guys are on your own.