The increasing focus on m-commerce from businesses such as France Telecom Orange, O2 parent firm Telefonica and Google is fuelling demand for near-field communication (NFC)-enabled smart phones.

A recent report by Juniper Research found that around one in five smartphones will have an NFC contactless capability by 2014, equating to almost 300 million handsets offering the technology.

The NFC Retail Marketing & Mobile Payments Report also suggested that growth will be driven in the interim by mobile network operators launching NFC-capable services in 20 early adopting countries before the end of 2012.

Several retailers in the UK have already trialled contactless technology in their stores over the past 12 months, including Spar and the Co-op, with companies seeing the technology as a logical way of reducing queuing time and increasing security at point of sale.

Later this year O2 will be launching a mobile wallet payment application that will support NFC, and the firm is seeking an e-money operating licence from the FSA, which would pave the way for peer-to-peer money transfers.

Juniper’s research was not all positive, with the report warning that business model structures still requiring development before NFC services can hope to achieve a critical mass.

By 2014, it is anticipated that North America will account for 50% of all NFC-enabled smart phones, followed closely by Western Europe as the second largest adopter of the technology.

Howard Wilcox, author of the report, said “Juniper’s market analysis highlighted that, although there are still hurdles ahead, NFC prospects have been boosted by the succession of mobile operators and device vendor announcements.”

Please note the views expressed in this blog are the views of the author, Andre Brown and do not represent the view of Locayta, its employees or its shareholders. For more information about Locayta, visit www.locayta.com