Broadcom’s progress from WiFi and DSL to cellular baseband has been slow, but it has gained a strong position in other mobile connectivity, providing single-chip architectures spanning Wi-Fi, GPS, Bluetooth and FM. Now it looks to be adding NFC (Near Field Communication) to the mix, acquiring UK-based pioneer Innovision as vendors start to integrate the technology into handsets for payment and transport ticketing applications. Broadcom’s timing is usually impeccable, and it managed to announce its purchase on the same day that Nokia pledged to incorporate NFC in its smartphones during 2011.
Innovision specializes in two ultra-short range wireless standards, RFID smart tags and NFC, the key technology for contactless payments and other swipe-based activities. NFC ‘ which is based on RFID – has been used for cashless payments, transport systems and other purposes, mainly within dedicated smartcards, but is just finding its way into handsets, which will avoid the need for separate payment cards. Japan has been the main deployer of handset-based payments, but these have largely used proprietary implementations.
Nokia has led the way in using standard NFC in low cost devices geared to emerging markets, notably its 6216 Classic, announced a year ago. Speaking at the Moby Forum event last week, Nokia’s VP of markets, Anssi Vanjoki, said NFC would be included in a wider range of devices from 2011. In addition to emerging market phones like the Classic range, NFC will turn up in high end smartphones, including those products Nokia releases next year for the future generation of its main OS, Symbian^4. Vanjoki added that his company would make tools available so developers could leverage NFC capabilities in their mobile apps. This is good news for NFC ‘ Nokia, despite its early commitment, had seemed hesitant at the smartphone end, complaining the user experience was not yet adequate. Samsung has an NFC-enabled handset, the Player One, now in trials with Orange France.
Last fiscal year Innovision made a net loss of £2.4 million on sales of £2 million and spent £2.3 million on developing NFC IP. Broadcom will pay $47.5 million in cash, an 84% premium on market value.
Like Broadcom, Qualcomm aims to offer highly integrated chipsets incorporating cellular radios, Wi-Fi, GPS and Bluetooth, and incorporated NFC in some products for the first time over a year ago ‘ though some believe it could look for its own acquisition to boost its efforts. There are many other players, including market leader NXP (which has significant IPR thanks to its Philips heritage) and several specialists like InsideContactless of France and Polaric of Denmark. STMicro will go commercial within the next few months and there is a Chinese player called Shanghai Fudan Microelectronics, which has supplied NFC chips to at least two local phone makers.
There are also reports that Sony, which jointly created the original NFC technology in collaboration with Philips’ chip business (now NXP), is working on its own chip. It already supplies the proprietary NFC variation, FeliCa, to the Japanese operators but these may convert to standard NFC, and KDDI announced a trial last week with Gemalto.
The first wave of chips have been standalone but increasingly NFC will be combined with the other wireless connections to target handsets. This is where Broadcom and Qualcomm will shine, but they are also likely to face competition from Texas Instruments and Bluetooth leader CSR.
NFC is not all about the handset ‘ some players are also targeting content or data transfer for PCs, cameras, media players and other products plus industrial applications. Indeed, TI’s first NFC chip, announced recently, does not support the Single Wire Protocol (SWP) that is used to integrated NFC with a SIM card ‘ and TI seems, therefore, to be targeting other markets first. CSR recently signed a collaboration deal with Intel to develop combined Bluetooth/Wi-Fi chipsets for PCs, which could also incorporate NFC in future.
Security is the key issue for an NFC phone, and Nokia executive Gerhard Romen recently outlined three ways of providing the ‘secure element’ on a phone ‘ as a separate chip, on an SD memory card or in the UICC (SIM). The Finnish giant had used separate chips but now prefers the SIM, following the endorsement of the SWP standard by ETSI. ‘If you place it in the SIM, then the cost of the chip goes to the operator and that’s fine with Nokia,’ Romen quipped in a webcast last year.