This Frost & Sullivan research service titled Strategic Assessment of the Asia Pacific Smart Card Markets Outlook provides an overview of smart card trends and technological developments across all applications.
Integration of Technologies Opens up Tremendous Opportunities for Smart Cards in the Asia Pacific
Technological advancement is the buzzword in the Asia Pacific smart card industry, with product quality and innovation displacing pricing as the primary business factor. Market participants are making significant headway toward product advancement, as is testified by smart cards’ increasing convergence of applications and integration with diverse technologies. Smart card companies are looking to establish an early mover advantage in countries with untapped potential. Since most of these countries do not have legacy systems, it will be easy for the market to straightaway implement contactless as well as next-generation converged applications. Indeed, tier 1 and 2 countries have already started converging payment and transit applications. The next step would be to integrate the same onto mobile phones.
This rapid pace of development, however, has thrown up issues of standardization and interoperability in the Asian market. As many system integrators provide their own proprietary software, end users often depend on a single system integrator. This could result in delays in project execution. "To address these issues of standardization and interoperability, smart card vendors are focusing on inter and intra project cooperation as well as migration toward the global platform for interoperability," says the analyst of this research. "This move will also enhance awareness of smart cards." Once end users are comfortable with the technology, new applications can be added to improve revenue generation.
Success of Converged Technologies Spawns More Near Field Communication Projects
The widespread usage of contactless cards and mobile phones for contactless transactions will gradually become evident in 2008. The success of converged applications in several Asian countries is tempting industry participants to replicate this success in other countries in the region. Near field communication (NFC) has moved out of boardrooms to field projects in Singapore, Taiwan, and Japan. In fact, there are already some cost-effective alternatives to the NFC phone. Some options include a contactless subscriber identity module (SIM) and a radio frequency (RF)-based SIM.
Another converged application that has caught the fancy of end users, particularly in Japan, is the 'mobile wallet'. This product, in which transit and payment applications converge, has proved to be so popular that the top three mobile operators have issued more than 100 types of mobile wallet phones. Yet another instance of converged technology implementation is the deployment of biometric readers in automated teller machines (ATMs) in Japan, Taiwan, and South Korea. "These ATMs were installed with biometric readers that employed smart cards integrated with biometrics," notes the analyst. "This provided stronger authentication, and the same was applied for corporate as well as residential access control."
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