NFC smartphones see breakthrough sales in 2011

Thirty-five million Near Field Communications (NFC)-enabled phones were shipped in 2011, in what has been described as a “breakthrough year” for the mobile payments technology.

According to analyst firm IMS Research, that number could grow tonearly 80 million by the end of 2012, driven largely by the technologybeing built into a wider range of devices. However, the companyhighlighted that Apple has so far failed to tap into the mobilepayments market. 

“Most of the leading cellular handset manufacturers havelaunched NFC-enabled handsets over the last12 months. They includeSamsung, RIM, Nokia and HTC,” said says Don Tait, senior analyst at IMSResearch. “Apple is the main player yet to release an NFC-enabledhandset.”

Mobile phone maker Nokia has been pushing NFC adoption foryears, but the technology has been fairly slow to take off. Also knownas “wave and pay”, NFC is a set of short-range wireless technologiesthat can beam and receive information at a distance of up to 4 inches,and is currently used in London Transport’s Oyster cards. Thetechnology allows consumers to carry out transactions by touching theirmobile phone to a terminal.

NFC didn’t make its way into the recently launched iPhone 4S, but Appleis expected to include some sort of e-Wallet application with theiPhone 5 when it launches in 2012. Last year the company hired NFCexpert Benjamin Vigier from startup mFoundry to product manage Apple’smobile commerce division. 

NFC coming to London Olympics

IMS Research also highlights a number of joint ventures andcollaborations that have been announced this year between differentplayers of the NFC ecosystem, such as the launch of Google Wallet inthe US and Orange UK and Barclaycard’s “Quick Tap” contactless paymentsolution. 

Meanwhile, British mobile operators Vodafone, O2 andEverything Everywhere – the T-Mobile/Orange joint venture – announced apartnership in June to create a shared mobile payment system usingnear-field communications (NFC). The venture aims to bring togetherretailers, banks and advertisers to speed up deployment of mobilepayment services.

According to IMS, showcase events such as the Olympic Games in Londonwill help to promote the technology and its benefits. EverythingEverywhere, Telefonica UK, Visa Europe and Samsung have all announcedplans to provide NFC at the Olympic Park, and there are alsosuggestions that Google could launch Google Wallet in Britain in timefor the games. 

Across the pond, the launch of the ISIS initiative in AustinTexas and Salt Lake City in Utah in the first half of 2012 will alsoboost the profile of NFC, said the analyst firm. ISIS is a jointventure between Verizon Wireless, AT&T and T-Mobile USA,created to allow smartphone-based NFC payments, using DiscoverFinancial Services to process the payments.

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Jim Love, Chief Content Officer, IT World Canada

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