A new report released by Juniper Research has shown that the decision not to put near field communication (NFC) on the iPhone 5 was a contributory factor in slowing down the growth forecast for the technology.
As a result, the mobile NFC growth forecast has been downsized to $110 billion (£68.7bn) by 2017, down from $180bn previously.
“Apple’s current reluctance to embrace NFC is likely to have a knock-on effect amongst retailers, who will perceive it as a lack of confidence in the technology,” notes Juniper.
Juniper also noted that consumer awareness of NFC remains low “despite the efforts of MNOs”, with Apple’s non-conformity being a vital factor in this regard. The domino effect from this would lead to fewer players focusing on NFC, therefore resulting in less marketing.
“While the enthusiasm for NFC payments is growing, Apple’s decision not to include an NFC chipset within the iPhone 5 has heightened the perception amongst some brands and retailers that the time is not yet right for them to invest in NFC campaigns and infrastructure respectively,”, wrote Juniper in a whitepaper.
The result is the ‘vicious cycle of NFC rejection’. No NFC chipset in iOS software, leads to fewer NFC point of sale terminals, less NFC marketing campaigns, less visibility leading to lower consumer takeup.
But with the fall in NFC market share, it’s worth remembering the technology’s plus points.
The aesthetic benefit of NFC is a vital plus point, as well as the accuracy involved in determining a user’s position compared to GPS.
Previous research from Juniper back in July showed a potential watershed for the technology, whilst predicting the aforementioned $180bn market. Research author Dr Windsor Holden stated at the time that it was a “critical time” for the NFC payments market, and he appears to have been proven right.
Elsewhere, research released today by eDigitalResearch has shown that consumer awareness of contactless payments has increased significantly.
33% of consumers claim to have seen a contactless mobile payment point, which has doubled since the last report six months ago. Similarly, 8% of respondents are aware they own an NFC-enabled device, again double May’s figures.
Where do you see the NFC sphere heading in 2013?
