Mobile Payments to Grow on NFC Chip Sales

Mobile Payments to Grow on NFC Chip Sales

NFC chip manufacturer Inside Secure shipped over 10 million units so far this year, suggesting adoption of the technology may grow as handset-makers find steady suppliers.

Inside Secure sold millions of its MicroRead and SecuRead NFC chips to manufacturers like ZTE and Research In Motion, which put them in the latest Curve and Bold smartphones.

The company said its chip supplies signal growing widespread NFC adoption across the mobile marketplace.

“Inside’s NFC chip shipments indicate that this market is achieving significant penetration as more and more mobile device and other consumer electronics device makers begin to integrate NFC functionality into their product offerings,” said Inside Secure COO Charles Walton.

Few handsets on today’s market, other than the Nexus S and a handful of RIM and Sony Ericsson smartphones, contain NFC chips. But that may change as more handset manufacturers begin to climb onboard NFC technology, responding to pressure from industry coalitions like Isis and services like Google Wallet.

Isis, a consortium of credit card makers, carriers and handset makers, seeks to standardize mobile, NFC-based payments across the industry. Isis recently furthered it goal when it joined the NFC Forum, a regulatory body aiming to set standards end fragmentation in the market.

As Isis draws disparate companies and services together toward adopting NFC, Google Wallet is slowly putting the service into use at select merchants across the country. Jamba Juice, American Eagle and Macy’s all offer discounts to those who use their Nexus S phones to purchase goods using NFC payments.

Google Wallet and Isis will need more hardware in the form of NFC-equipped phones, however, in order for the technology to gain more traction in the market.

Inside rival NXP Semiconductors may come to the rescue, as it began manufacturing chips for Sony Ericsson phones in August. The company also predicted 40 million NFC-capable phones would hit the market by 2012.

At the time, NXP CEO Rick Clemmer said, “This latest move from Sony Ericsson is another proof point of the strong momentum and potential of NFC.”

Broadcom also unveiled a 40-nanometer chip that is reportedly 90 percent more energy-efficient than standard NFC hardware. It plans to market the technology next year and will likely see high demand given NFC’s increasing growth, thanks to Isis and Google Wallet.

More handset makers are adopting NFC technology and may soon make NFC-based mobile payments a widespread reality, boosting the profits of chip makers betting on the standard to take off in the market.

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