Global sales of handsets featuring Near Field Communication (NFC) capabilities increased ten-fold in 2011 to 30 million units. Growing at a compound annual growth rate (CAGR) of 87.8 percent, shipments are forecast to reach 700 million units in 2016.

New data from Sweden’s Berg Insight also notes the global rise in smartphone adoption also is driving higher attach rates for other wireless connectivity technologies in handsets including GPS, Bluetooth and wireless LANs (WLANs). These connectivity technologies already are a standard feature on high-end smartphones and most medium- and low-end models. WLAN connectivity in handsets enables a range of use cases including offloading data traffic from increasingly congested mobile networks, media synchronization and indoor navigation services.

The attach rate for GPS among GSM/WCDMA/LTE handsets reached 31 percent in 2011, growing to 38 percent for all air interface standards, Berg adds. Shipments of WLAN-enabled handsets have more or less doubled annually in the past four years and the attach rate increased to 33 percent in 2011. 

“Reliable indoor navigation systems for handsets need hybrid location technologies that fuse signal measurements from multiple satellite systems like GPS and GLONASS with cellular and WLAN network signals, together with data from sensors such as accelerometers, gyroscopes, compasses and altimeters,” says André Malm, senior analyst. He adds that periodic calibrations using satellite and wireless network signals are necessary to compensate for the low data accuracy and high drift obtained from low-cost sensors used in handsets today.??

The NFC technology for short-range wireless point-to-point communication reached a breakthrough in 2011 when several leading handset vendors released more than 40 NFC-enabled handsets. NFC can be used for countless applications including pairing devices to establish Bluetooth or WLAN connections, information exchange, electronic ticketing and secure contactless payments.

“Even though it will take some time before the stakeholders agree on business models for payment networks, other use cases such as reading tags and easy pairing of devices may well be compelling enough for handset vendors to integrate NFC in mid- and high-end devices already today” concludes Malm.

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