Hitting the N-Mark with NFC

Transcription

1 WHITEPAPER Hitting the N-Mark with NFC This whitepaper is an extract from: NFC Retail Marketing & Mobile Payments Markets, Forecasts & Strategies information you can do business with

2 Hitting the N-Mark with NFC 1. Introduction This whitepaper focuses on the use of NFC (Near Field Communications) for mobile commerce. Mobile commerce is defined as the buying and selling of goods and services through a mobile phone or other handheld wireless device. In terms of definition of mobile device, we make a distinction that the primary function must be mobile telephony. This excludes other mobile devices that would have a primary function such as entertainment, e.g. digital music players. There are many different types of mobile payments currently available and Juniper Research has identified two main categories: Remote Mobile Payment - when the storefront or retailer is remote to the mobile phone user, e.g. paying for digital goods or physical goods via a mobile web enabled retailer POS (Point of Sale) Proximity Mobile Payment - when the storefront or retailer is physical and the user is located at or near to the storefront or retailer, e.g. the payment is made in a physical storefront in the same way we would use cash or a plastic debit/credit card or at an unattended vending or ticketing machine. With NFC proximity payments, a contactless NFC chip is embedded into the phone or the SIM card and interacts with a payment application that is either pre-loaded or downloaded OTA (over the air). The transaction takes place as a Wave & Pay transaction where phones equipped with NFC are waved in front of a contactless reader in a store or at a purchase point. These proximity purchases usually replace cash and are often for lower value items such as refreshments, newspapers and magazines but also tickets (often for public transport). Transactions are typically of lower value up to $25 in total before the phone needs re-charging with credit. The NFC ecosystem includes mobile operators, banks and credit card companies, retail merchants & transport operators, handset manufacturers (and their suppliers), and a whole range of new application software and system vendors, consultants and service providers entrants eager to put their innovative mobile payment solutions into the hands of mobile phone users. 2. Case Study ~ Orange - Cityzi (France) The Cityzi commercial pilot ran since May 2010 in Nice, France. There are nearly 3,000 customers, and the pilot is operated in partnership with the AFSCM (Association Française du Sans Contact Mobile), Page 1

3 which brings together Orange, SFR, Bouygues and NRJ Mobile. Other partners in the Cityzi project include a range of international standard bodies, governmental authorities, working groups and service providers. The service has been launched commercially. With the support of the French Government, nine further cities will be launched for contactless services in 2011: Bordeaux, Caen, Lille, Marseille, Nice, Paris, Rennes, Strasbourg and Toulouse. In total French MNOs expect to sell one million NFC handsets in The Orange Cityzi Pass is the commercial NFC service that enables Orange customers in Nice to use Cityzi contactless services on their mobile handset. Services include local urban transport, payment in over 1000 shops, loyalty, couponing and tag reading. The Player One Cityzi handset is being sold in France from January, and further handset models will follow from the spring as Orange works towards its 500,000 target for users by the end of A screenshot from Cityzi is shown below. The launch in Nice is a rehearsal for the national deployment that Orange is planning for Figure 1: Cityzi Mobile Ticketing Source: cityzi 3. NFC Smartphone Opportunities Juniper Research s full report on NFC provides six year forecasts for NFC ticketing and retail payments, across eight regions of the world. We forecast that the market will begin to ramp and reach approaching 300 million smartphones by North America and Western Europe will be the largest regional markets as shown below. We forecast strong growth of NFC smartphones in the Far East & China in particular after 2012 as FeliCa featurephones in Japan are churned and replaced by NFC devices as a result of the transition to global standards. This churn will complement commercial launches in other regional countries such as China where China Unicom launched its scheme in Beijing in late 2010 using its SIM replacement strategy. Page 2

4 Figure 2: NFC Smartphones (%) Split by 8 Key Regions 2014 North America Latin America Western Europe Central & Eastern Europe Far East & China Indian Sub-Continent Rest of Asia Pacific Africa & Middle East Source: Juniper Research Order the Full Report This whitepaper is taken from the Juniper Research report entitled NFC Retail Marketing & Mobile Payments: Markets, Forecasts & Strategies published in April This board level evaluation of the rapidly developing NFC market delivers the most extensive appraisal of the industry to date. Across three detailed forecast chapters this report provides a strategic blueprint for companies and market planning professionals aiming to maximise on the growing opportunities within NFC retail marketing and NFC mobile payments. Three Forecast Chapters: Forecast chapter one projects data for NFC mobile payments including the average number of NFC transactions per handset as well as the number of transactions and transaction value, with all data broken down into NFC ticketing and NFC retail payments. The second forecast chapter projects the market for NFC retail marketing, forecasting the number of NFC Coupons and Smart posters downloaded as well as the total fee value. The third forecast chapter forecasts the ARPU opportunity for NFC Ticketing, Retail payments, Mobile Coupons and Smart posters. Breadth & Depth of Analysis: From tracking key market developments over the past 12 months this report covers 18 significant industry announcements, assessing the relative prospects for NFC and evaluating eight key regions. The report concludes with vendor briefs of 14 players in the market with Juniper s view of their strengths and strategic development opportunities. Key Questions Answered by this Report How many active NFC users will there be in 2016? Which region will show the most growth over the forecast period? What are the ARPU opportunities associated with NFC? How will transaction volumes change over the next five years? Which will be the leading regions for NFC coupons and smart posters? How many NFC mobile tickets will be purchased over the next five years? Further details of all Juniper reports can be freely downloaded from the Juniper Research website Alternatively please contact John Levett on +44 (0) Page 3

5 Juniper Research Limited Juniper Research specialises in providing high quality analytical research reports and consultancy services to the telecoms industry. We have particular expertise in the mobile, wireless, broadband and IPconvergence sectors. Juniper is independent, unbiased, and able to draw from experienced senior managers with proven track records. Publication Details Publication date: April 2011 Author: Howard Wilcox For more information, please contact: Michele Ince, Director Juniper Research Limited, Church Cottage House, Church Square, Basingstoke, Hampshire RG21 7QW UK Tel: UK: +44 (0) / USA: Fax: +44(0) Further Executive Briefings and whitepapers can be downloaded at Page 4