The new functionality enables consumers to make payments by simply ‘bumping together’ two mobile phones (or compatible devices). Now at first you would think this works using some sort of NFC chip like the one within Oyster cards but amazingly it is done without any fancy new embedded technology.

It uses…the accelerometer. Yes, the sensors that are inside one third of phones and detect its position, like knowing whether the phone is landscape or portrait. Now here’s the amazingly clever bit:

When two people with the app bump phones, the sensor readings are sent to the Paypal servers where the algorithm listens to bumps happening all over the world and matches the two phones that felt the same movement.

Then various techniques are used to limit the pool of potential matches like location and characteristics of the bump. If lots of people in the same area are bumping, then they are simply asked to bump again to make sure.

The users have to agree the match is correct, then contact details and money is exchanged.

The bump feature is built on technology developed by US start-up Bump Technologies and will be available on Android soon.

Paypal adds Bump to its already well established  mobile payment solutions which include Paypal Mobile and Text-To-Buy which work great on any handset.

Can it compete with NFC?

Over at NFC World the post about the new Paypal feature poses the question “Could PayPal bump NFC’s P2P ambitions into touch?” and my answer would have to be…No.

I’m sure that if NFC is a success consumer-to-business then it will carry that success to peer-to-peer payments too.

Also the experience isn’t seemless like NFC. You have to open the application, press a button and then initiate the bump. With NFC you just have to touch to start the process.

Once NFC starts appearing on phones I’m sure that Paypal will take any opportunity to become a part of that. Then there would be no need to have the Bump app on a NFC phone if it already supported Paypal right?

Any physical retail ambitions for bump may need to be put on ice as payment terminals for retailers are dominated by banks and companies like Visa and Mastercard who are pushing NFC in a big way. Londoners might have noticed the changes at places like Pret A Manger and Coffee Republic already.

And when the iPhone gets NFC, what retailers will want to start supporting Paypal Bump?

It doesn’t really seem like Bump will rock the boat too much but it’s still amazing use of technology to provide payments.

Interestingly it can even be used for other things like transferring files and even Facebook friending!

[Via NFC World]

Over the next 18 months Orange will be launching a range of ‘future phones’ which showcase new innovation in technology. The first up is the LG touch screen watch phone.

It features 3G, video calling, a touchscreen and the ability to compose text messages by only viewing one word at a time on the tiny screen.

The limited edition phone will go on sale from 9:00am on the 27th August in the Orange Shop, Bond Street Station, London at the hefty price tag of £500.

Check out the video below for a preview.

In 2005 LG Launched the LP-4100 Sobriety phone (Korea only), the main selling point being that it had a in-built breathalyzer.

All owners needed to do was blow on the sensor for the reading to appear on the display. If you are over the limit the display shows a car hitting some cones.

But here is where it really gets cool. The LP4100 also allows you to set up the phone so on certain nights and after a certain time it will restrict you from calling certain people in your phone book. Yes that’s right, it has a ex girlfriend/boyfriend druken call preventor.

This is a bit old but I remembered it when I was posting about the Shaver Phone. This phone would be even better if it gave you the numbers of the nearest taxi company and directions to a kebab shop.

If you have ever looked at your phone in disgust because it doesn’t stop you from growing a beard then this is the mobile for you. It packs a 2 megapixel camera , dual sim mode and touchscreen capabilies, not bad for $84.
Check out Deal Extreme for more details.