A report by IHS subsidiary, IMS Research, sees 2013 as the beginning of rapid market growth of near field communication (NFC). According to the market research firm, shipments of NFC-enabled cell phones will reach 1.2 billion units from 2012 through 2017.

NFC is a short-range, high-frequency wireless communication technology that allows cell phones to communicate with smartcards and readers, as well as with other NFC devices. It is used to perform safe, contactless transactions involving payment, public transportation or transfer of data (see Enabling utility transactions with NFC). While the technology initially targeted mobile handsets, NFC is increasingly being used in other devices such as tablets, sports and medical devices, gaming consoles, headsets, and consumer white goods. Majority of smartphone makers are adopting the NFC as a de facto standard of their products. IHS forecasts that worldwide shipments of NFC-enabled cell phones in 2013 will reach to 268 million units, up 123 per cent from 120 million in 2012. Significant growth will continue over the next four years to reach the estimated 1.2 billion unit shipments in 2017.

This rapid proliferation of NFC in cell phones is seen to be driven by several factors such as the expanding availability of contactless readers and the rising consumer awareness. However, one of the key challenges for the market this year is to develop services and applications that consumers want. This will help to develop mass appeal and adoption of the technology.

Apart from Apple, nine out of the top 10 smartphone suppliers have launched at least one NFC-enabled product into the market. With Apple losing market share from other smartphone suppliers such as Samsung and revenues and share price suffering, the chances of NFC being incorporated into future iPhones and other devices looks more promising. If Apple decides to incorporate NFC into its devices, this will have a positive impact on profile and growth of the market. However, it could also be argued that Apple has rarely been one to follow the crowd and prefers to be a technology pioneer. This would mean that they could potentially adopt another technology other than NFC, which is more in keeping with their business model and their walled garden approach to business. Time will tell which way Apple decides to go in regards to NFC.

In 2012, Android-based smartphones dominated the NFC marketplace with 103 million units, or 86 per cent, of all NFC-enabled smartphones shipped. In 2017, IHS believes the number of Android NFC-enabled smartphones will reach 718 million, or 67 per cent of the enabled handset shipments NFC by modem type
Shipments of NFC modems in all kinds of devices—including smartphones—are expected to rise rapidly during the next five years. By 2017, all NFC modem device type shipments will grow to 1.46 billion, up from 150 million in 2012.

The most popular method of incorporating NFC into cell phones now is by embedding a standalone modem device directly into the handset. This type of method made up 97 per cent, or 133 million, of all NFC modems that were shipped in handsets in 2012. However, throughout the forecast period, other implementations will become more popular, such as combination connectivity ICs. IHS forecasts that shipments of combination connectivity ICs are projected to increase to 612 million units by 2017, or 50 per cent of all modems, up from 31.7 million units in 2013.

By: Docmemory
Copyright © 2023 CST, Inc. All Rights Reserved