Antone Gonsalves

What Apple's iBeacon rollout doesn't say

December 11, 2013 11:06 AM EST

Apple's rollout of iBeacon in its 254 U.S. stores raises the question: What about security? Unfortunately, there's unlikely to be an answer for sometime.

Apple's iBeacon debut

Apple debuted the in-store location technology last week in its New York store on Fifth Avenue, with many other stores expected to turn on the service soon. People that permit the Apple Store app in their iPhones to receive iBeacon messages will be told about products and events when standing near one of numerous transmitters set up throughout the store.

Initially, Apple fans will receive encouragements to trade in old iPhones and reminders to read product reviews in the app. Apple plans to also use the service to tell people how long the wait is at the Genius Bar, provide information on product availability and greet people entering the store to pick up an online purchase.

None of this information will be eye-popping for most store visitors and won't help other retailers discover the possibilities of the technology. With the exception of Black Friday, Apple doesn't discount products, so there won't be any coupons for a case when buying an iPhone or a 10 percent discount for buying a Macbook Air in the next half hour.

That's the kind of stuff other retailers are interested in. If a person with a supermarket app is standing in the beer aisle the day before a big football game, the store wants to send coupons for chips and dips.

Apple plays it safe

By using iBeacon only for distributing information, Apple plays it safe by avoiding some of the thornier issues that come with using the technology. Hilmi Ozguc, chief executive of in-store mobile marketing plaform provider Swirl, says iBeacon was designed to easily discover iPhones nearby and to distribute content. In fact, anyone can turn their iPhone into an iBeacon and send a signal to another iPhone.

That's great for distributing information in public places, such as museums and tourist attractions, but it doesn't meet retailers' need for data security and privacy, Ozguc points out in a guest post on VentureBeat.

"iBeacon’s fundamentally open design means that any mobile app could be designed to pick up a retailer’s location broadcast, including apps developed by competitors or unscrupulous third party developers," he says. "These apps could use that broadcast information to locate and track a user, possibly without their permission."

To prevent these intrusions in privacy, companies using iBeacon will have to add layers of data encryption and security into the in-store transmitters.

Apple's basic implementation also avoids the accuracy problems associated with the Bluetooth Low Energy (BLE) standard powering iBeacon. Einar Rosenberg, chief technology officer for Narian Technologies, says BLE still uses too much power and its not very accurate at location. A person standing infront of one section of products can easily be mistaken for standing infront of a nearby section.

In addition, Bluetooth shares the same spectrum with many cordless phones and microwaves and nearly the same frequency as Wi-Fi. This could lead to lots of interference troubles.

Other retailers

Apple is not the first retailer to use indoor location beacons. Timberland, Kenneth Cole, and Alex and Ani have been experimenting with the technology for the last six months. Major League Baseball plans to use iBeacon technology next season to distribute content to fans watching games in stadiums.

These are the early days of iBeacon, which holds a lot promise for retail stores to win back shoppers from the Internet. But there are lots of kinks to work out, and Apple is just one of several retailers taking a cautious approach.