Projected 419 Million NFC Chipsets by 2012

More than 419m NFC chipsets will ship in 2012, according to a new research study from ABI Research. “NFC chipset shipments and revenue will continue to grow steadily over the next five years, as the market adapts to this new technology,” states senior analyst Douglas McEuen.

However, similar to most semiconductor markets, NFC revenue is offset by declining unit ASPs. By 2012, the research forecasts that NFC chipset ASP will decline to $0.97, for total market revenue of $406.

“Transportation systems are implementing contactless payment schemes, wireless device content management is growing, and connectivity options are escalating without offering clear ease-of-use focused applications,” continues McEuen. “NFC technology, aided by NFC IC short-range communication capability, addresses each of these issues with proven technology in an industry-standardized format.”

ABI Research's forecasting methodology includes a top-down Bass Curve regression analysis, as well as a bottom-up approach to the potential of the market. Both market views are important, says McEuen, considering that operator demand for a standardized approach to NFC handset architecture significantly pushed the emerging NFC industry toward a standard platform implementation, while simultaneously delaying the potential for NFC deployment.

In North America, ABI Research sees demand for handset application directives from operators, as well as from third parties. Europe - though lagging in the contactless RFID payment space due to payment infrastructure constraints tied to the EMV (Europay, MasterCard, and Visa) deployments - is extremely well-suited for NFC. This region is a highly transit-centric environment full of content and mobile payment opportunity across its GSM family networks.