Industry Research Reports and Market Analysis at MindBranch.com
  

Market Communique: "Near Field Communication (NFC) - Movers & Shakers Speak"

Product Type: Market Research Report
Published by: Frost & Sullivan
Published: August 2007
Product Code: R1-6045
Description
The Frost & Sullivan research service titled Market Communique: "Near Field Communication - Movers and Shakers Speak" provides an overview of the near field communication market, analysing the main drivers and restraints affecting the industry and the key challenges that the industry participants face. In this research, Frost & Sullivan's expert analysts thoroughly examine the involvement of different stakeholders of this ecosystem, driving factors for the adoption of this technology, potential opportunities and market forecasts.

This analysis is available through our Smart Cards Growth Partnership Service programme. With this programme, clients receive industry-leading market research such as this, along with technical and econometric data and many interactive features including Analyst Inquiry Time and Client Council.

Market Sectors

Expert Frost & Sullivan analysts thoroughly examine the following market sectors in this research:
  • SIM vendors
  • Mobile communications
  • Banks, financial institutions and payment companies
  • Transit companies
  • Retailers
  • Trusted service managers
Technologies

The following technologies are covered in this research:
  • Near Field Communication (NFC): NFC is one of the latest wireless network technologies that can provide simple and safe communication between electronic devices. It is primarily a short-range wireless connectivity technology, where communication would be possible when two NFC-compatible devices are brought together within four centimeters of one another.
  • WiFi: WiFi allows wireless connectivity in peer-to-peer mode. A WiFi enabled device can connect to the internet when in proximity of an access point.
  • Radio Frequency Identification (RFID): RFID is an automatic identification method and relies on storing and remotely retrieving data.
  • Single Wire Protocol (SWP): SWP is likely to be adopted as a standardized protocol which will be used for connection between the SIM card and the NFC chip.
  • MIFARE: MIFARE is the most widely installed contactless smartcard technology in the world.
  • FeliCa: This is contactless IC smart card system, primarily used in electronic money cards.
Market Overview

Near Field Communication Promises a Whole New World of Convenience

Continued advances in technology have transformed the now indispensable cellular phone from a mere calling device into a boundless communication tool. The latest technology furthering this march is near field communication (NFC), which holds the potential of transforming wireless applications into interoperable communication resources. Mobile phones with built-in NFC chip could not only facilitate the usage of public transportation but also allow retail payments, transfer of data, entry access to stadiums/concerts and much more. What is more, NFC would also help increase revenues as information would be easily accessible, helping promote marketing and advertising.

However, standard issues remain a major challenge in taking the technology forward. While the GSM association has already endorsed the Single Wire Protocol (SWP) standard to be adopted for the connection between the NFC chip and the SIM, the industry awaits the decision of the European Telecommunications Standards Institute (ETSI), as to whether it favours the NXP or the SWP protocol. "Additionally, Mobile Network Operators (MNOs) should have security certifications such as the EMV cards in order to gain the trust of financial institutions and banks to have the applications stored on the SIM," notes the analyst of this research service. "This is easier said than done, as financial institutions today are not very comfortable about letting the MNOs control the master keys to their applications."

On-going Trials putting NFC Technology on the Adoption Path

Given its enormous promise, a number of trials are being conducted all over the world to test and verify the use of NFC-enabled mobile devices for payment and ticketing services, as well as the use of NFC tags. Recently, HSBC embarked on a six-month trial in the United States, issuing 1.5 million contactless cards. Consumers could use their contactless phones to make purchases of under $25 at more than 35,000 merchants like McDonalds, drugstores and even 7-Eleven stores. The payments are made through over-the-air software, which needs to be downloaded on the NFC-enabled phone. This trial intends to check the feasibility of the potential market. DoCoMo in Japan is also involved in such projects, wherein restaurant owners can send personalized e-coupons to their customers.

Going forward, NFC technology is likely to open up new services and opportunities for various participants such as network operators, device manufacturers, service providers and enterprises. Having said that, the most important challenge NFC faces today is the building of a robust ecosystem, which requires all players to work together to build a successful business model. "While a lot of NFC-enabled handsets that are out today are prototypes and cater only to pilot tests, this segment of phones is likely to see greater market penetration in the next five years," says the analyst. "Frost and Sullivan anticipates NFC-enabled handsets to capture 1 per cent of the total handset market in the year 2008, and this is expected to increase to around 13-15 per cent by the year 2010."
Table of Contents
1. Introduction

1. Overview

1. NFC Overview

2. Standards-History and Future Expectations

2. Market Overview

1. Market Analysis

1. Market Challenges

2. Market Drivers

a. NFC Offers a Whole New World of Convenience that Would Make it an Indispensable Technology

b. NFC Opens Innovative Service Offerings from the Perspective of MNOs, Making them Enthusiastic About Participation in NFC Related Projects

c. Mobile Payment and Convergence of the Wallet is a Key Driver for NFC Applications

d. NFC Offers an Increase in Revenues for all Service Provider Participants Resulting in Strong Positive Growth

e. NFC Offers Secure Means of Communication Between Various Devices, thus Making it a Reliable Service Offering

f. NFC Helps Explore the Potential of Wireless Platforms

g. Mobile Phones Offering Multifuntional Capabilities Through the Use of NFC Technology Gains Huge Market Acceptance

3. Market Restraints

a. Lack of Infrastructure Would Dampen Technology Acceptance

b. Lack of Awareness and Understanding Hampers Growth

c. Already Existing Cheap Alternatives Would Make it Difficult for Market Adoption

d. The Market Needs to Have Enough NFC Equipped Handsets Before Commercial Roll Outs Can be Made Possible

e. Migration to the NFC Technology for Various Sectors Would be a Costly Affair Resulting in Slow Acceptance

f. Different Players Still Need to Agree on an Acceptable Pricing Model

g. There is No Proven Business Model to Attract Investment

3. NFC Applications

1. Usage

1. Introduction

2. NFC Applications to be Used in Mobile Phones for ‘Transactions’

3. NFC Applications to be Used for Services Access

4. NFC Applications to be Used for Easier Connectivity

4. Technology Development

1. Regional Analysis

1. EMEA

2. Asia Pacific

3. North America

4. Latin America

5. Industry Analysis

1. Market Trends

1. Forecasts

6. The Ecosystem

1. Overview

1. Introduction

2. Forums and Associations

1. Role of Forums and Associations

2. Marketing Committee Chair and Director - NFC Forum

3. Silicon Solution Providers and SIM Vendors

1. Role of Silicon Solution Providers and SIM Vendors

2. NFC Marketing Manger-Gemalto

3. Telecommunication Business Unit-Sagem Orga

4. Global Business Development Manager-NXP

4. Application and Service Providers

1. Role of Solution Providers

2. Multimedia Project Manager-Parrot

3. Chief Technology Officer-Narian Technologies

4. CEO-Venyon

5. Mobile Network Operators

1. Role of Mobile Network Operators

2. Vice President Payment and Contactless-Orange

6. Banks and Financial Institutions

1. Role of Banks and Financial Institutions

2. Senior Vice President and Deposit Access Products Operations Manager - BB&T

7. Transit Companies

1. Role of Transit Companies

2. Public Transport Contactless System - RATP Paris

8. Retailers

1. Role of Retailers

7. Conclusions

1. Summary

1. Industry Outlook

2. Conclusions
Ordering and More Information
Price and Delivery Options


MindBranch has been the leading provider of industry and investment research from more than 550 independent research firms since 1992. With over 90,000 market research reports, MindBranch is your trusted source of competitive business intelligence.