NFC handset availability will start to ramp up in 2010 but handsets using the GSM Association’s preferred Single Wire Protocol approach to NFC won’t be around in volume until 2011 and beyond.
“The chicken and egg scenario that has bogged down the embryonic NFC market has taken steps forward in recent weeks,” says IMS Research. “Now some industry insiders are expecting large volume shipments of NFC handsets in the second half of 2009.”
However, says the firm, “IMS Research still forecasts that it will take more time than this for handsets using the SWP variation of NFC to be available in any significant volume.” The SWP (Single Wire Protocol) was officially endorsed by the GSMA in November as the preferred way for mobile operators to implement their NFC applications.
IMS’ latest research is published in two reports, ‘NFC: The Road to Mass Market’ and ‘Mobile Wallet: How, What, Where and When?’. Their findings indicate that SWP-based NFC handsets will start to ramp up in 2010 and will then gain significant penetration and volumes in 2011 and beyond.
“Whether this will be the long-term solution is yet to be determined though,” says IMS. “Whilst SWP will account for the vast majority of shipments in the next four years, several companies have developments for SIM-only NFC solutions, incorporating the RF, microcontroller and secure element in the SIM card. These remain a medium-term prospect.”
“The natural design cycle of handsets means that launching NFC on any meaningful scale will take up to nine months at best; but there will be a further period of time as new handsets and the supporting infrastructure filter into the marketplace,” said John Devlin, IMS’ research director. “Whilst this is manageable and can be planned for, what is more unpredictable is the time required to turn well intentioned partnerships into workable relationships.”
“The support from all parties for NFC is high and the feedback from the trials has been overwhelmingly positive”, added Devlin. “Often with a new service or technology there is a period of learning and education for operators and end users. However, with NFC services for payment, ticketing and the provision of information everyone is able to see immediate benefits.”
“Where it breaks down,” says Devlin, “is in how the business partners can best agree to make money out of these services without stepping on each other’s toes. It is natural that the operators will look at SIM-only solutions that will strengthen their ability to control the NFC services available to their customers.”