NFC phone market to reach 416 million units in 2014, says IHS

Near Field Communication (NFC) cell phone shipment will reach 416 million units this year and 1.2 billion units in 2018, said IHS Technology.

NFC phone market will grow more than 50 percent this year to 416 million.

NFC cell phone shipments rose 128 percent to 275 million units in 2013 from 120 million in 2012.

From 2013 through the end of 2018, worldwide shipments of NFC-enabled cellphones will rise by 325 percent.

NFC was integrated into 18.2 percent of the 1.5 billion cell phones shipped worldwide in 2013. In 2018, NFC penetration will rise to 64 percent.

Don Tait, senior financial and ID market analyst at HIS, said: “Consumers are becoming increasingly aware of the benefits of mobile payment—and NFC wireless readers are proliferating in businesses throughout the world.”

NFC phone shipment chart by IHS

IHS says this strong momentum will allow the NFC cell phone market to overcome barriers, including a lack of compelling services and applications, and the sluggish progress on establishing the required infrastructure.

A major challenge for the NFC market in 2014 will be to develop services and applications that consumers want. This will help to promote mass appeal and adoption of the technology. The slow pace at which the mobile payment ecosystem is being rolled out is another key challenge that will need to be addressed this year.

While NFC was initially targeted at cellphones, the technology is increasingly being used in other devices such as tablets, sports and medical devices, gaming consoles, headsets and consumer white goods. An NFC modem is defined as an NFC IC with an antenna attached to it.

In 2013, Android-based smartphones dominated the NFC marketplace with 254 million units, or 93 percent, of all NFC-enabled cellphones shipped.

In 2018, IHS predicts the number of Android NFC-enabled smartphones will reach 844 million, representing 75 percent of the NFC cellphone shipments.

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