Bloomberg has an interesting report tonight, but they have the headline all wrong. Apple Plans Service That Lets IPhone Users Pay With Handsets — is technically correct (assuming the report is true, of course), but it completely downplays the potential ramifications of what Apple is apparently attempting to do. If Apple can nail Near-Field Communication (NFC) and tie it directly into their already-established iTunes payment system. It could change everything. It could transform Apple from the biggest technology company in the world, to the biggest company in the world, period. By far.

Granted, that’s a very big “if” in the above statement. And there are many unknowns from this report, which I’m simply extrapolating out. But there’s also a lot that makes sense, if you think about it.

First of all, Bloomberg’s Olga Kharif reports that Apple will build NFC chips into the next iteration of the iPhone. That should be absolutely no surprise — in fact, we reported on it months ago. Plus, given that rival Google has already done this for the Nexus S Android device, it has gone from a no-brainer to a must-do.

What is somewhat surprising is first of all that the report only mentions the new iPhone “for AT&T” and not Verizon. And secondly, that NFC is said to be built into the iPad 2 as well.

It’s hard to know what to make about the former. Perhaps that’s just a slip up? Or maybe AT&T really will get the iPhone 5 first?

The iPad 2 talk is conceivably more straightforward. Typically, NFC is associated with mobile payments, but don’t forget that it can also be used for a host of other short-distance data communications. In fact, it could well be that NFC becomes a staple of most Apple products for beaming information instantaneously and securely over a short distance. Things like photos, movies, etc. Also, imagine if the iPad is in your bag or purse, it could certainly still be useful when it comes to paying for things by sending a signal to a receiver a few inches away.

But the key to this is really iTunes. Or more specifically, the payment system within iTunes that is already in use by millions and millions of people around the world.

The obvious main reason that NFC hasn’t taken off yet for payments is the lack of hardware support. But one reason that’s been slow to come is that manufacturers likely know that there’s simply no good payment processing system behind any of the current ideas. In fact, the best possible way for things to start moving is probably for the credit card companies to do this themselves and get the ball rolling. But while they are testing the technology, they don’t seem to see the need to disrupt a system that is already working.

So why is this becoming a big deal all of a sudden? Well, everyone’s ears perked up when they heard Google would be including NFC chips in the Nexus S. But the same basic problem remains. For all of Google’s strengths, they have not been able to nail a payment processing system. Yes, they have Google Checkout. But customers clearly prefer competitors like PayPal. The situation is so bad that they’ve even had to start including carrier billing options in Android so people will finally start to buy apps on a whim. Users are simply not doing that as much as anyone would like with Google’s current payment structure. And the system is to blame.

And the same issues will likely hold up their NFC ideas as well. And we’re already seeing the fact that while the Nexus S has NFC built-in, you can’t do anything with it yet.

Enter Apple. The technology giant does have a proven payment system. One with over 100 million accounts set up with built-in credit card access. But those interviewed by Bloomberg for the story suggest that Apple aims to go farther with NFC:

The main goal for Apple would be to get a piece of the .2 trillion Americans spend each year on goods and services, Crone said. Today, the company pays credit-card processing fees on every purchase from iTunes. By encouraging consumers to use cheaper methods — such as tapping their bank accounts directly, which is how many purchases are made via PayPal — Apple could cut its own costs and those of retailers selling Apple products.

And why would customers do that instead of using a credit card? Because a new piece of regulation may soon make it cheaper to pay via debit rather than credit. Apple could be in the right place at the right time with this.

Also from Bloomberg’s report:

Apple, based in Cupertino, California, is considering starting a mobile payment service as early as mid-2011, Doherty said. It would revamp iTunes, a service that lets consumers buy digital movies and music, so it would hold not only users’ credit-card account information but also loyalty credits and points, Doherty said.

In other words, it could be an evolution of the payment system within iTunes to allow for rewards, and other flexibility.

But what about the other side of the coin? It’s fine if Apple builds NFC into their devices, but there still needs to be equipment to read them. There’s a bit on this as well:

Apple has created a prototype of a payment terminal that small businesses, such as hairdressers and mom-and-pop stores, could use to scan NFC-enabled iPhones and iPads, Doherty said. The company is considering heavily subsidizing the terminal, or even giving it away to retailers, to encourage fast, nationwide adoption of NFC technology and rev up sales of NFC-enabled iPhones and iPads, he said.

You can expect Google to do the same. But again, Google doesn’t have the iTunes infrastructure in place to make this happen in a real way. Apple does. If they get a piece of that .2 trillion market, there’s no way they could downplay it as negligible revenue, as they try to do with the app and music sales cuts. It could conceivably be one of their biggest money-makers. And it could completely disrupt a number of industries.

But let’s not get ahead of ourselves here, he says 1,000 words later.

TechCrunch