NFC Device and Secure Element Shipments to Grow 120% in 2013 Despite Continued Business Model Concerns

Oyster Bay, New York - 13 May 2013

NFC momentum continues to build despite the on-going delays affecting the launch of NFC payment services. Notable highlights of ABI Research’s recent NFC Market Data include full year 2012 shipments of secure elements were raised to 147 million with 125 million enabled handsets being shipped. Growing inclusion of embedded solutions by OEMs will account for the majority of secure elements in 2013 as MNOs seed the market with close to 100 million SWP SIM cards.

Expected NFC-enabled device shipments were increased, with 2013 forecasted to reach a minimum of 320 million units across all product categories—an increase of 118% over last year. This will drive the market past the half billion NFC devices in use in 1H13.

Practice director, John Devlin commented: “This is certainly encouraging after many years of ‘will they, won’t they’. The market has now passed the tipping point and is being further enabled by increased competition across all areas of the market. There are multiple chip vendors offering a range of product alternatives to OEMs in various form factors with security and connectivity specialists all coming to the fore. As a result, attach rates are increasing, devices are reaching market, and service partners – who had been holding back due to lack of devices – are now developing their own innovative use of NFC, bringing new services and NFC applications to market.”

On a cautionary note he added: “There remains a stand-off between the business model and value-add being offered by MNOs to targeted business partners. It continues to drag as it does not meet the expectations or requirements of the vital mobile, retail, and financial service partners. Most of the current activity that we are tracking is largely focused around non-payment applications designed to increase interactivity of devices. This allows consumers to use their smartphones and access information and content in new ways whilst giving OEM and service brands the chance to increase customer engagement.”

These findings are part of ABI Research’s NFC Research Service.

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