Nokia Announces New NFC Phone

Handset maker Nokia this week announced plans to launch its long-awaited follow-up NFC mobile phone, which it says will be the first commercially available handset with built-in NFC features. Nokia made the announcement early this week at the giant Consumer Electronics Show in Las Vegas, Nevada, predicting its NFC-enabled 6131 model will be on the market during the first quarter. NFC is a short-range wireless technology that allows phones and other devices to act like contactless payment or ticketing cards. It also enables devices to download data from “smart tags” embedded in posters, among other features. Nokia, the world’s largest handset maker, is a strong backer of the technology. “NFC is a market in 2007 (and) will see broader acceptance,” Gerhard Romen, head of NFC market development for Nokia, tells Card Technology. “We will see quite some pilots going on but also the first deployments. 2008 and 2009, the volume markets will begin to grow.” Nokia’s earlier NFC phones: its 3220 model, used in most of the NFC pilots to date, and its lesser-known 5140 handset, were retrofitted with detachable shells containing NFC chips and short-range radio antennas, along with separate secure chips to store applications. The new NFC phone comes with all of this built-in, and it supports the technology in the handset’s operating software. The 6131, although not a new phone itself, also offers other features subscribers might want, such as a built-in digital music player, FM stereo radio, 1.3-megapixel camera and a slot for removable microSD cards, which can store music and photos. Nokia began shipping the non-NFC version of the mid-tier 6131 last May. But whether the real customers for the NFC version of the 6131–mobile network operators–will want it remains to be seen. The phone, like the earlier 3220, comes with an embedded chip to securely store payment, ticketing and other applications. But large operators that are backing NFC have stated a clear preference for putting these applications on the SIM card, which they issue to subscribers for network access. Using the SIM would make it easier for the operators to collect revenue from the rollout of services on NFC phones. “The secure element in the phone, going forward it will be on the SIM,” acknowledges Romen. “At the moment, there are no standards allowing the secure element to be on the SIM.” Jonathan Collins, a senior analyst in London for U.S.-based ABI Research, doubts the new Nokia phone will be used for many NFC rollouts. “It was clearly time for a new phone, but again, it’s not that there’s a market yet,” he tells Card Technology. “This is a phone that is primarily going to be used in trials.” That would give it more in common with NFC “prototypes” from other handsets makers, including rival Samsung, he says. Mobile operators, which will be the ones ordering most of the NFC phones that Nokia, Samsung and other handset makers will sell, are still working on the business case for NFC, he says. ABI predicts operators eventually will see the justification for subsidizing the NFC phones. While last fall the research firm downgraded its projection for the penetration of NFC handsets in the market over the next five years, it still predicts handset makers will ship 450 million units by 2011. Nokia’s Romen expects a new standard for the SIM interface with the NFC chip to be adopted within the next six months or so. “For the next devices and next versions, we can implement whatever is the new (SIM) standard,” he says. But Nokia “decided to move ahead” with the 6131 without the SIM-NFC connection. It forecasts a roughly two-year life span for the phone.

– By Dan Balaban