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Two in three phones to come with NFC in 2018

World shipments of NFC handsets, in millions

UPBEAT: Forecast for world shipments of NFC handsets, in millions. Source: IHS

NFC will be included in 64% of the mobile phones shipped in 2018, up from 18.2% in 2013, according to a new forecast from IHS Technology.

Global shipments of NFC-enabled mobile phones will be more than four times higher in 2018 than in 2013, the researchers add, with annual shipments increasing from 275m units in 2013 to 1.2bn units in 2018.

Last year “sounded the starting gun for the fast growth of the market”, IHS says, with shipments up 128% on 2012′s 120m units. That growth will continue In 2014 with the market set to expand by more than 50% to 416m units. Overall, from 2013 through the end of 2018, worldwide shipments of NFC phones will rise by 325%.

Android phones dominated the 2013 numbers, with the operating system accounting for 254m (93%) of all NFC phones shipped. In 2018, Android will account for 75% of the NFC phone market — 844m units.

Nine in ten NFC phones shipped in 2013 made use of a standalone NFC modem, IHS adds. By 2018, however, combo chip solutions will be used in 50% of NFC phones (603m units), up from 17.2m units in 2013.

“The majority of smartphone makers are adopting the NFC wireless communications and payment technology in their products as a de facto standard,” says Don Tait, senior financial and ID market analyst at IHS.

“Consumers are becoming increasingly aware of the benefits of mobile payment — and NFC wireless readers are proliferating in businesses throughout the world. This strong momentum will allow the NFC cellphone market to overcome barriers, including a lack of compelling services and applications, and the sluggish progress on establishing the required infrastructure.”

“A major challenge for the NFC market in 2014 will be to develop services and applications that consumers want,” IHS warns. “The slow pace at which the mobile payment ecosystem is being rolled out is another key challenge that will need to be addressed this year.”

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