But with the predictions and projections for the NFC market growing bigger and bolder by the day, one has to wonder if the hype is starting to get out of hand.
As recently as March 8th, a new study by Juniper Research projected that NFC will facilitate transactions valued at $74 billion by 2015. That’s a fairly optimistic forecast, given that NFC remains a relatively new technology that consumers are hardly familiar with.
Juniper’s “Mobile Commerce Markets” report, however, indicates that the quick-paced adoption of mobile devices for commerce related applications “is by no means limited to NFC.”
“Our report demonstrates the spectacular growth we see across all segments of the mobile commerce market,” says report author David Snow. “Four of these segments (money transfer, physical goods, NFC and coupons) will more than triple in transaction value over the next three years, whilst digital goods, banking and tickets will still on average, double over the same period.“
Competing Theories on NFC Growth and Adoption
“In developed markets, companies are trumpeting the prospects of NFC without realizing the complexity of the service model,” Sandy Shen, research director at Gartner, said last year. “We believe mass market adoption of NFC payments is at least four years away. The biggest hurdle is the need to change user behavior by convincing consumers to pay with mobile phones instead of cash and cards.“
Notwithstanding the curtailed expectations of some, NFC’s leading proponents – with Internet search Google chief among them – believe NFC is underestimated, not overhyped. But even the most optimistic of studies still show reason for at least moderate concern when it comes to NFC.
As the Juniper report stressed, mobile commerce providers especially need to keep security issues in mind.
“Even if there is a perceived, if not actual, security risk in the mind of users, not only the specific mobile commerce application, but also the whole mobile commerce market may be set back until user trust is recovered,” Juniper advises.
Picking Apple for NFC
Despite the best efforts by Google, Visa, PayPal and others in the nascent NFC arena, many industry watchers believe Apple – and only Apple – can give NFC the immediate boost it needs in the short term.
Rumors swirled prior to the iPhone 4S introduction last October that Apple was poised to integrate NFC into the new iPhone. Of course, that didn’t happen. But this fall, when Apple’s 6th generation iPhone is unveiled, an NFC-equipped device could suddenly make the technology something it largely isn’t to the masses – sexy.
Regardless of what the rumor mill suggests, 2012 could still prove to be a monumental year for NFC. But it will require the hype to be reconciled with reality. And, at present, that’s a gap that not even Evel Knievel would try to jump.