Microwave Journal

Near Field Communication Handsets Are Not Just for Big Spenders

September 10, 2007

Despite the additional cost and complexity of adding NFC (Near Field Communication) to mobile handsets, this emerging technology will not remain the preserve of the most expensive handsets, as is often the case with cutting-edge features. Instead, according to a recent study from ABI Research, the drive from operators and their NFC application partners — including financial services companies, retailers, and transportation operators — will see NFC technology available across a wide range of mobile phones: from high-end smartphones to low-end handsets.

In its latest analysis of the NFC market, ABI Research forecasts that by 2012, of the nearly 300 million NFC handsets to ship worldwide, nearly 18 percent will be low-end NFC handsets.

“NFC makes mobile handsets more useful for subscribers and multiple service providers,” says senior analyst, Jonathan Collins. “Because of this, unlike earlier short range wireless additions — such as Bluetooth — the benefits of NFC will be pushed to a broad range of subscribers: not just the biggest spenders and early adopters.”

Mobile operators are moving closer to their first NFC handset orders and are aware that more NFC-enabled phones in use will make their new contactless services all-the-more attractive to other businesses, which look to benefit from NFC. Near Field Communication will make the method of paying at local coffee stores, hamburger joints, on the city subway, and many other places possible with a mere wave of the mobile handset. It also enables credit card issuers to bypass the process of manufacturing and mailing out new cards; it allows events and transportation companies to save on printing and checking tickets; and it permits retailers to better serve and target their customers with promotions.

“From the start,” added Collins, “the NFC business must be about mass adoption.”

While some issues remain to be resolved, ongoing trials around the world are helping to shape the resolution of those issues while testing mobile subscriber acceptance.

The new ABI Research study, “Near Field Communications (NFC): Leveraging Contactless for Mobile Payments, Content and Access”, shows why wireless operators must be confident that they will see a clear return from specifying NFC in their latest handsets. The study discusses how increasing numbers of NFC-enabled handsets in the market will drive NFC application adoption, and includes forecasts for device and chipset shipments and revenues, among others. The study forms part of three annual research services: Mobile and Contactless Commerce, Mobile Devices, and Short-Range Wireless.