Despite its former optimism over the use of near field communication (NFC), Juniper Research has now revised, and scaled back, its forecast of the growth of the technology globally.

 

Part of the reason for the change comes from Apple omitting to implement an NFC chipset in its iPhone 5. This, Juniper Research explained, has “reduced retailer and brand confidence in the technology, leading to reduced POS (Point of Sale) rollouts and less NFC campaigns.”

 

The knock on impact that the company anticipates includes lower NFC visibility amongst consumers and fewer opportunities to make payments, threatening a cycle of “NFC indifference” in the short term.

 

The company elaborated 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 bn in 2017, significantly below the $180 bn previously forecast.

 

For the uninitiated, NFC is a technology that enables payments to be made, and other transactions performed, via proximity technology included in many new smartphones.  

 

 

“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,” commented the report’s 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,” he continued.

 

The report found that Apple’s move would impact most dramatically on markets in North America and Western Europe, where transaction values would exhibit a “two year lag” on previous forecasts as retailers delay POS investments. On the other hand, transactions in NFC’s heartland – of Japan and Korea – are likely to experience little or no impact from the decision.

In more optimistic news for the technology, the report found that despite Apple’s decision, NFC trial consumer feedback such as at the London Olympic venues and in Singapore - has been extremely positive, suggesting strong latent interest when services are more widely deployed.

To the point

Interestingly enough, Juniper Research’s revision of its NFC forecast shows how influential the iPhone, and Apple’s decisions can be on another technology, particularly Stateside, where Apple’s products dominate.

 

Nonetheless, NFC may have suffered a right hook to the jaw and be slowed down somewhat, but it is certainly not out for the count. In short, as a technology trend, NFC is apparently still here to stay.