IDC Viewpoint: Nokia Announces NFC on Lumia 610

The NFC on Nokia's Lumia 610 is nothing to get excited about...yet

(PresseBox) (Frankfurt am Main, ) Nokia has announced an NFC version of its latest smart phone, the Lumia 610. This is the first smart phone running on the Windows Phone platform to feature near field communication (NFC) technology. NFC is a fairly simple technology that is able to transfer data wirelessly between two devices when close together, but it can enable a whole range of functions and services.

NFC is an enabler of services, rather than a service in itself. These vary from simple, 'open' services, to much more complex functions that require a secure element and involve multiple parties. A mobile wallet for example, would bring together the more complex services that NFC enables such as contactless payment provision, ticketing and loyalty schemes, along with the connectivity and computing power of the phone, and enable it to interact efficiently and benefit the user. This is a very complex proposition, with many interested parties, many different elements to consider and thus multiple barriers to overcome.

Bottom Line for ICT Buyers:

1. Nokia has been championing the simpler functions that NFC enables. In 2011, Nokia introduced new headsets and speakers, which featured NFC capabilities. This has been Nokia's NFC focus, and we expect them to continue in this vein, but the NFC Lumia 610 is certified for contactless payment services on both the Mastercard and Visa systems, so it obviously could be a phone to host a mobile wallet. Nokia has said it is planning to introduce NFC more broadly across its smart phone portfolio. However, if it is hoping that this feature will provide a significant sales draw IDC fears it may be disappointed.

2. Given the lack of public awareness of, and desire for, NFC capabilities, the inclusion of NFC on the Lumia 610 is unlikely to increase the appeal of this phone to end users. It may however help to make the phone popular with mobile operators who are keen to promote NFC in order eventually to enable better penetration for mobile wallet products.

3. Announcements concerning NFC tend to lead to a good deal of hype, declaring that the technology is about to take off and revolutionize everybody's life. It does have the potential to make a significant impact. The fully realized mobile wallet could offer a wide array of very rich functionalities, from more interactive, location-based advertising and highly targeted promotions, to remote check in at hotels or secure premises that allows immediate access on arrival through an NFC key card sent straight to the phone. However, while NFC phone could in theory do all of these things at the moment, to make them a reality for a large number of users will require many complex business models and agreements, as well as significant levels of standardization, all of which are a long way off. Savvy enterprises should start considering how an NFC phone could affect their business, and how they can best utilize its capabilities in future, but they can also afford to take their time.
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