Is NFC finally going to make it into mainstream cellphones, asks David Manners, looking at some latest stats from IHS? NFC has been a bit of a bridesmaid to the cellphone industry, he says, hanging around hopefully without ever getting to the altar.
Unfortunately, for NFC, it is not just about the number of phones shipped with NFC support in them. Fingerprint technology is now present in Apple and Samsung devices, David Manners notes, promising more sophisticated means of identification, and Apple – previously shunning NFC, and favouring Bluetooth Smart – will not want to be out of the mobile payments game…
David Manners writes:
IHS reckons that 275 million phones were sold with NFC in them last year – that’s out of 1.5 billion phones shipped last year i.e. 18.2% of the total number of phones shipped had NFC in them.
In 2012 IHS says 120 million were sold, this year it expects that 416 million will be sold and, in 2018, it expects 1.2 billion to be sold when phones with NFC will represent 64% of the market.
So now, with Apple supposedly entering the world of mobile payments in the summer, NFC’s nuptials could be nigh.
Except that Apple may use low energy Bluetooth.
iOS7 supports BLE and so, for that matter, does PayPal’s mobile payment system.
The advantage of BLE over NFC is range – 50 metres compared to 30 cms – so reducing the number of Apple iBeacons or PayPal beacons used to cover a store.
So poor old NFC, after waiting for so long, may get jilted just as she prepares to sashay up the aisle.
Is Apple really going to do the mobile payments thing?
Well corporate pest, sorry activist investor, Carl Icahn, says: “We believe a revolutionary payments solution is now a very real opportunity that the company could choose to pursue.”
Now one thing which might make Apple keen to go down the mobile payments trail is the fact that nearly all the NFC-enabled phones sold last year – 93% of them – were Android, with 254 million NFC-enabled Android phones sold.
If Android – possibly using PayPal’s mobile payments system – were to go down the mobile payments route, then an Apple without a mobile payments system would be the one looking jilted.
And since both Apple and Samsung now have fingerprint technology in their phones allowing identification without the need for complex log-ins and passwords – mobile payment starts to look attractive.
So you could say the stage is being set for mobile payments. Certainly everyone expects it. The argument is more about implementation.
The most popular method of incorporating NFC into cellphones now is by embedding a standalone modem device directly into the handset. This method made up 90%, or 267 million, of all NFC modems that were shipped in handsets in 2013.
However, in the coming years, other implementations will become more popular, such as combination connectivity integrated circuits (ICs).
IHS forecasts that shipments of combination connectivity ICs will increase to 603.0 million units by 2018, or 50 percent of all modems, up from 17.2 million units in 2013. The introduction of combination connectivity ICs has been slower to market over the last 12 months than first projected.