Market Insight

NFC-enabled Handset Shipments to Reach Three-Quarters of a Billion in 2015

June 29, 2015  | Subscribers Only

Don Tait Don Tait Principal Analyst, Cybersecurity & Digital ID

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Shipments of NFC-enabled handset are projected to increase to 756 million in 2015, up from 444 million in 2014, according to latest research from IHS Technology (NYSE:IHS).

World Shipment of NFC-enabled Cellular Handsets

 

 

 

 

 

 

 

 

 

 

NFC Research Key Findings:

  • Payment has been seen as the driving application for NFC over the last seven years. Payment is one of the few globally interoperable applications where there is contactless acceptance which is being installed. The launch of Apple Pay to these devices represents a shot in the arm for the NFC ecosystem as a whole and NFC payments in particular. Until then, Apple was the last of top ten smartphone suppliers to launch an NFC-enabled handset.
  • With the launch of Apple Pay, Samsung Pay and Google Pay, NFC payments are becoming a more popular form of mobile payment. With the liability shift happening in the US in October 2015 and the increasing number of POS terminals that are becoming EMV compliant, NFC payments is projected to become more popular. The only technology that provides compatibility on the POS terminal side with plastic cards and mobile solutions as of today with the same environment is NFC. The more contactless EMV cards and terminals that are deployed will automatically spread the places where NFC on a phone can be used.
  • Android operating system will be the largest segment for NFC-enabled smartphones in the forecast period. Samsung’s Galaxy range of smartphones will continue to remain popular and drive growth of this segment during the forecast period.
  • The trend towards combination ICs incorporating NFC with Bluetooth, GPS and Wi-Fi has been much slower to be adopted compared to three or four years ago. There is very few combination ICs from Broadcom, Qualcomm and Marvel that actually incorporate NFC. It has proved difficult from a technology standpoint to incorporate NFC in a traditional combination IC. 
  • There will be an increasing number of NFC-enabled handsets and other NFC devices (e.g. portable computing devices, stickers, tags and credentials, consumer electronic devices, cars and medical & sports performance devices) launched on to the market. 
  • Many of the car manufacturers are extremely interested in using the mobile handset and NFC. The car industry has very high security requirements, whether it is to unlock the car door or start the car. They need to have a secure element as de facto standard. IHS believes that the product life cycle within the car industry is very long so the incorporation of NFC will take time.

 

In summary, NFC is finally coming of age and gaining some traction. It has taken over ten years to get to this stage, but the next five years will prove more fruitful with 2.2 billion NFC-enabled handset shipments in 2020.

Regards,

Don Tait

Phone: +44 1933 402255   |  Direct: +44 1933 408079 

Email: Don.Tait@ihs.com

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