Report Claims iPhone 5 is Holding Back NFC

It’s almost difficult to imagine how Apple’s juggernaut iPhone 5 could be responsible for restraining the growth of any mobile technology, but when the new Apple smartphone was …

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It’s almost difficult to imagine how Apple’s juggernaut iPhone 5 could be responsible for restraining the growth of any mobile technology, but when the new Apple smartphone was releases sans Near Field Communications technology, the business of NFC got bumped to the back-burner.

That’s according to a new report from Juniper. On Wednesday, Juniper Research published its revised forecasts for the global NFC market. By the firm’s own admission, Juniper is “significantly scaling back” its growth estimates for the North American and Western European markets.

While the report finds that by 2017 the proportion of NFC-enabled smartphones will be only marginally below previous estimates, global NFC retail transaction values are now expected to reach $110 billion in 2017, significantly below the $180 billion previously forecast.

So is Apple really to blame?

Apple’s decision to omit an NFC chipset from the iPhone 5 has reduced retailer and brand confidence in the technology, leading to reduced POS (Point of Sale) rollouts and less NFC campaigns, Juniper says.

“While many vendors have introduced NFC-enabled smartphones, Apple’s decision is a significant blow for the technology, particularly given its previous successes in educating the wider public about new mobile services,” said report author Dr. Windsor Holden. “Without their support, it will be even more difficult to persuade consumers – and retailers – to embrace what amounts to a wholly new means of payment.”

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2 comments

  1.    Reply

    Perhaps Apple is planning to integrate their NFC with another app that expands beyond current uses of NFC in a think outside of the box way. This might be NFC & location based for integrated authentication /permission/ gold level access type applications at retail or hospitality locations.

  2.    Reply

    I think we see here an example of a well known psychological phenonem of "Self-Handicapping" – the projection of blame for possible (likely?) failure onto someone else to protect your own ego. As time goes on, it looks that the success of NFC phones for payments (or even contactless payment cards) isincreasingly in doubt, the proponents of the technology line up behind a view that they would have succeeded except for the inexplicable (maybe malign) actions of powerful forces beyond their control.

    There are two things I'd like to say: firstly the contactless experience isn't great – by the time the retailer has primed the device, (and some then take the card from you, and some won't take it for payments under £5) and you're "tapped" and then they've given you a receipt there's little benefit compared to the contact interface. Secondly, the problem here is changing people's behaviour – think how long credit cards, and then debit cards took to reach the position they are in now. Rome wasn't built in a day, it's too soon to give up.