Some 100 million NFC-enabled smartphones to be sold this year

More and more consumers adopting NFC handsets

Global sales of smartphones that include near-field communication (NFC) technology will hit 100 million this year, according to new research by Berg Insight, as more and more consumers adopt handsets with the contactless technology for a range of activities including mobile payments. The figure is more than three times the 30 million units sold in 2011 and dwarves the 3 million sales in 2010, as adoption begins to ramp up. Total sales of NFC-enabled smartphones are expected to grow at a compound annual growth rate (CAGR) of 87.8% to hit 700 million units worldwide by 2016, according to Berg. NFC is expected to play a large role in the adoption of mobile payments services, with users able to swipe their smartphone at the point-of-sale to purchase goods. NFC-enabled smartphones also enable consumers to swap content between phones, such as images and contact details.

With the mobile payment market continuing to develop and a raft of services mobilising, many expect the coming year to be the year of the NFC-integrated device. However, senior Berg analyst, André Malm warns that it could take longer for NFC-based mobile payment services to really take off. However, he believes that this won’t slow integration of the technology, citing 2011 as a “breakthrough year” for NFC integration by smartphone vendors, with 40 NFC-enabled handsets released last year, including devices from Research In Motion and Google’s Nexus S.

Even though it will take some time before the stakeholders agree on business models for payment networks, other use cases such as reading tags and easy pairing of devices may well be compelling enough for handset vendors to integrate NFC in mid- and high-end devices already today,” says Malm.

Nevertheless, analysts are clamouring to predict the future of the NFC-based payment market in the coming years, with a report from Juniper Research earlier this month forecasting that NFC will power $74 billion worth of transactions globally by 2015, making it one of the fastest growing segments of the mobile commerce market. The prediction is good news for firms such as Google, which ploughed into the NFC-based payment space last year with its Google Wallet service.

Related reading

Leave a comment