Near Field Communication (NFC) technology is an extension of existing RFID technologies defined under ISO/IEC 14443 proximity card and ISO 15693 vicinity card. NFC combines reader and card infrastructure in the same device. Standardization also defines higher layer common data format, which can be used to store and transport different kind of data items over the NFC link.
The market is set for widespread adoption of the technology in a whole range of applications. Applications in conjunction with mobile phone offer great opportunities for end users and mobile phone ecosystem players.
NFC technologies mainly cater for following application areas:
- Peer-to-Peer communication
- Card Emulation – Payment and ticketing
- Reader Mode
Applications can be built on existing communication/computing infrastructure. Over the years a business case has emerged to have low cost NFC ICs that can be applied for a broad range of uses and thereby reduce the risk of commercial failure.
Figure 1: NFC-Application Interface
Source: NXP Semiconductors, 2011
For effective deployment of applications, the NFC ecosystem is evolving around mobile phones and tablets. The key players in the ecosystem development are:
- Chip manufacturers – IC providers along with software, firmware and drivers
- Handset manufacturers – NFC-enabled phones
- Application developers
- Mobile Network Operators
- Utility Providers – Banks, Retailers, Transport companies
- Trusted Service Manager
Figure 2: NFC Eco-system
Source: NXP Semiconductors, 2011
NXP has positioned itself not only as an NFC IC player, but together with secure element ICs, with FW and SW integrated, with most mobile and tablet Operating Systems to enable the most secured transactions over mobile devices. Having closely integrated NFC and secure elements allows the user’s payment credentials stored in a chip called the Secure Element contained within the phone or tablet. The Secure Element is isolated from the phone’s main operating system and hardware. Only authorized applications like Google Wallet can access the Secure Element to initiate a transaction.
At the last India annual smartcard show, NFC was seen everywhere and participants’ interest was very clear. IC manufacturers like NXP and others had featured their NFC offerings. Supporting them, UICC manufacturers such as Gemalto, Oberthur, G&D etc. demonstrated their NFC capabilities along with entities like Visa and MasterCard. Availability of NFC-enabled mobile phones and other devices in high volumes will lead to a huge market in the coming years and will create opportunities across payments, service discovery, transport, ticketing etc. Mobile phone manufacturers have started putting NFC capabilities in low end mobile phones, which will increase NFC penetration.
According to a press release from Nokia, all new Nokia smart phones will come with NFC from 2011. Similarly other OEMs for smart phones and tablet manufacturers are following suit.
The NFC Forum has announced liaisons with GSMA, Mobey Forum, ETSI, Smart Card Alliance and these relationships are acting as the key to building out the eco-system and ensuring interoperability. The Forum introduced a new Implementer level of membership to attract business interest and vertical market players. According to a plan of the NFC Forum, the compliance process should provide a vehicle for the interoperable NFC ecosystem to grow.
In summary, the stage is all set for a mass roll out of NFC with the major hindrances being addressed.