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(Pocket-lint) - Apple subtly introduced iBeacon as part of iOS 7 at WWDC 2013, though it mentioned the feature only in a single keynote slide and didn't go into detail at all. But this hasn't stopped companies from taking advantage and launching products and services that make use of iBeacon.

iBeacons essentially makes way for new range of apps and functions. With it, stores can pipe coupons to your phone, mapping apps can offer indoor navigation and more. Here's the real clincher: iBeacon might just be that nail in the coffin for NFC.

So, what is iBeacons, and why does it matter? Read on to find out. 

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1. What is iBeacons?

iBeacons is a brand name created by Apple for a specific technology. That technology allows mobile apps to recognise when an iPhone is near a small wireless sensor called a beacon (or iBeacons, as well). The beacon can transmit data to an iPhone - and visa versa - using Bluetooth Low Energy (BLE). iBeacon is a feature in iOS 7, thus Apple's new iPhones will have iBeacon.

Let's put this into a scenario: Say you own an iPhone 5S and you're walking by a Starbucks that has a beacon. When you enter that beacon's zone, the beacon will transmit special promotions, coupons, recommendations, etc, to your iPhone 5S via the Starbucks app. Beacons will also accept payments, so you can pay for a Starbucks coffee without having to bump or tap your phone against anything.

2. Who will make the beacons?

One company making headlines is Estimote. It manufactures BLE-enabled beacons that transmit data to any BLE-enabled device within range. PayPal is another company jumping on the iBeacon board. It recently announced Beacon (of course), which will allow people to make purchases via the PayPal app without having to interact directly with their phone. 

Check out Estimote and PayPal's promo videos below, where both companies explain how the beacons will work.

3. What is Bluetooth Low Energy?

BLE is a technology meant for transferring data. It consumes minuscule amounts of energy and allows device batteries to last longer. However, BLE only supports low data rates; you can't stream audio or send large files with it. BLE is ideal for transmitting smaller amounts of data though, such as fitness data to fitness trackers or payment data to beacons.

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BLE is a feature in iOS 7 and Android 4.3.

4. Is iBeacons only good for shopping and coupons?

No. iBeacons also features micro-location geofencing. This is ideal for indoor mapping. For instance, GPS signals have trouble penetrating the steel and glass of buildings. This prevents many mapping apps from offering indoor navigation, but iBeacon’s micro-location feature hopes to solve the problem. 

An iPhone with iBeacon can connect to a nearby beacon to determine a GPS location. You could then navigate through an airport, casino or museum just by using a mapping app. And that's only the beginning; the possibilities are endless. 

5. What's the difference between iBeacons and NFC?

Watch the video above to learn about near-field communication technology (NFC). The important thing to remember is that iBeacon is better than NFC in terms of range. iBeacons requires a physical beacon to transmit data, just as NFC requires physical NFC tags to transmit data.

The main difference is that NFC only works in close proximity. NFC's range is up to 8 inches (the optimal range is less than 1.5 inches), while iBeacons' range is up to 50 meters. It's also worth noting that NFC-enabled devices require an NFC chip to transmit data. iBeacon requires only that an iPhone support BLE.

6. Will iBeacon be more expensive than NFC?

iBeacons is more affordable. Using the Starbucks reference again, the area of a typical Starbucks store starts at 1,700 square feet. iBeacons' range is 50 meters. Therefore, Starbucks would need one beacon at minimum for each store. Estimote is currently offering pre-orders of three beacons for $99.

If Starbucks wanted to use NFC instead, it would need to put 10-cent NFC tags on every product. That mean's it would pay $100,000 for NFC tags to put on 1 million products.

7. Why does iBeacons matter?

We know that Apple has yet to adopt NFC. It's instead worked on improving the uses of Bluetooth and Wi-Fi. When Craig Federighi, Apple's senior vice-president of software engineering, introduced AirDrop in iOS 7 at WWDC 2013, he said: “There's no need to wander around the room, bumping your phone."

His words were a direct jab at NFC - as the technology requires a close proxmity to transfer data. Our guess is that NFC will never be a reality in iOS devices, and the technology itself might go belly up. You could say iBeacon is the future. Apple still hasn't published all the details of iBeacons, but it's probably capable of so much more. Stay tuned.

Writing by Elyse Betters. Originally published on 18 September 2013.