Beginning to take shape
Google claims NFC-enabled devices running its Android OS are now shipping at a rate of 1 million units per week, suggesting that consumer uptake of the technology, which allows users to make payments using their mobile phones, is increasing steadily. Google says it has activated 400 million Android devices to date and is activating 1 million daily, meaning that around 15% of its Android devices now come with NFC. With Nokia launching its first NFC smartphone earlier this month and Apple expected to integrate the technology into the next iPhone, it looks as though the mobile payments hardware infrastructure is beginning to take shape, although wide-scale adoption is not expected for another few years.
The figures suggest that NFC uptake may be happening faster than previously thought as consumers become more familiar with the technology. Research from Berg Insight earlier this year claims that some 100 million enabled devices will be sold in 2012, more than three times the 30 million units sold in 2011. Adoption is only expected to accelerate as more NFC devices come to market and the growing number of digital wallet services from the likes of Google, Apple and PayPal give consumers more choices to pay using their smartphones. Payment companies are taking their own initiative to speed up NFC uptake, with BarclayCard launching PayTag stickers that users can glue to their handsets to make mobile payments.
Meanwhile, Google is also updating its Android Beam service, a suite of NFC tools launched as part of an update to its Android OS last year, attempting to demonstrate that the scope of NFC technology is not limited to mobile payments. NFC, which allows devices to transmit data over short distances, is not a new technology, underpinning services such as the Oyster card payment system in London’s tube system. Although Google is not revealing how popular Beam is proving, the move is aimed at boosting uptake, with many consumers still wary of using NFC to make mobile payments. Google’s latest updates to Beam updates include video sharing between devices and the ability to pair Android smartphones and tablets to other devices.
For the moment, analysts believe NFC adoption remains some way off, with Juniper forecasting that one in four consumers in the US and Western Europe will pay for goods in-store using an NFC-enabled mobile device by 2017.
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