Transport and ticketing clear winners as mobile payment methods converge to NFC?
Total spend via mobiles using near-field communication (NFC) is to rise more than twenty-fold from $4bn this year to $100bn in 2016 according to forecasts from ABI Research.
And, the figure will almost double to $191 between 2016 and 2017 according to the forecast.
The company predicts the convergence of payment types to NFC devices will see the adoption of the technology across ticketing, retail, loyalty schemes and access control – all clearly areas hugely significant for travel.
The research shows market convergence is currently about two years away but that transportation and ticketing will be the first market to be able to take advantage.
ABI predicts 26% of all NFC handsets will have a contactless ticketing application in 2017 and that the technology will also enable transport companies to offer other services including route planners, status alerts, timetables and ancillaries.
But, we’ve been here before, lots of big numbers predicted but not so much real action.
Many eyebrows were raised in the travel industry when Apple announced its iPhone 5 without NFC capability although Tnooz node Glenn Gruber provided some grounding facts on current NFC device adoption generally and where the travel industry is.
A number of initiatives are already underway in travel such as Singapore’s bid to become the first NFC-enabled city with three mobile network operators rolling out the technology which is accepted by 20,000 shops.
Meanwhile, Toulouse-Blagnac Airport trialled a seamless passage initiative with 50 passengers in the summer using SIM-based NFC.
To be fair, the research also points to the barriers to growth such as the unproven business models and nothing to show potential returns and says existing pricing strategies from mobile network operators hamper market entrance and not investing massively in the technology themselves.
It adds that neither Telefonica with the 02 wallet or Barclays PingIt so far include NFC technology.
However, ABI Research analyst Phil Sealy says its research has been fairly conservative to date where others have had to adjust theirs.
“Shipment of NFC handsets is ramping up very quickly now. Having it shipped does not mean someone is going to use it but penetration is increasing. A lot of NFC chips are going into other consumer products as well.”
So, still just bluesky stuff or will we really start to see some movement?
NB: NFC image via Shutterstock
Linda Fox is deputy editor for Tnooz. For the past eight years she has worked as a freelance journalist across a range of B2B titles including Travolution, ABTA Magazine, Travelmole and the Business Travel Magazine.
In this time she has also undertaken corporate projects for a number of high profile travel technology, travel management and research companies.
Prior to her freelance career she covered hotels and technology news for Travel Trade Gazette for seven years. Linda joined TTG from Caterer & Hotelkeeper where she worked on the features desk for more than five years.