Last year, Apple filed an international patent for an electronic device that uses Near-Field Communication (NFC) technology as well as sensory scanning technology. Speculation soon followed that the iPhone 5S and iPhone 5C scheduled for release on September 20th would be NFC-enabled. However, after the unveiling of the new iPhones on September 10th, it became clear that NFC will not be on the table this time around.
The NFC SIM Market, which equips SIM cards found in mobile devices with NFC capabilities, is among one of the NFC markets to be disappointed by Apple’s decision. NFC uses weak radio signals to connect devices within close proximity, usually no more than a few inches, allowing users the “tap to pay” option which has become increasingly popular among consumers.
So Why Did Apple Choose Not to Use NFC?
Well, when Apple announced the new tech specs for the iPhone 5 back in 2012, they publicised the addition of Passbook which according to Apple Vice President Phil Schiller, “does the kinds of things customers need today”…except allow iPhone users to pay for anything by using their device, that is.
While Passbook did provide iPhone users with a whole new way to organize tickets, gift cards, passes and loyalty cards, it doesn’t offer the “tap to pay” feature. This move by Apple boggled tech minds, especially considering that Google, one of Apple’s chief rivals, had already begun equipping their Android devices with NFC technology in 2011, and a year later unveiled Google Wallet, which functions exactly like Passbook but with the added convenience of a “tap to pay” feature.
Even though Apple’s decision to exclude an NFC upgrade came as a surprise, investors in the NFC SIM market shouldn’t lose sleep over it. In 2011, the market was worth approximately US$ 56.9 million and that number is expected to increase to US$ 817.4 million by 2015. That means the NFC SIM market is expected to grow at colossal CAGR of 94.7 percent during the forecast period.
Although Apple won’t be among The NFC SIM Market’s list of clients, vendors are already capable of generating huge profits without Apple’s business. If Apple does decide to adopt NFC technology one day, it will only add to this highly profitable market.
For more information, view our 2011-2015 Global NFC SIM Market report.