Post on 20-Aug-2015
Asia Pacific SIM Outlook
Peering into Trends of SIM
Presented By
Anne-Corinne BellDirector Consulting and Business
DevelopmentFrost and Sullivan, Hong Kong
Prepared By
Jafizwaty Haji IshahakResearch Manager, Smart Cards, ICT
Practise Asia Pacific
2
Focus Points
•Global Smart Cards Overview
• Snapshot
• Percentage Split by Region
•Asia Pacific Market Dynamics
• Asia Pacific (APAC) Smart Card Overview
• SIM: Key Market Drivers & Restraints in APAC
• APAC SIM Market Size and Forecast
• Direction and Technology Trends
3
Global Smart Cards Overview: Snapshot
• In 2008 approximately over 4.6 billion smart cards were shipped worldwide
• By 2015- expected to grow to over 7 billion units with CAGR of 6.4 percent
• Decrease in Memory and an increase in MCU
• Applications such as SIM, Banking and payment, Government ID, Transportation are key contributors to the total global smart card revenue.
• Europe and parts of Asia have been the technological leaders in smart card application over the years. In both these regions, there are catalysts in various fields, pushing the boundaries of smart card usage year on year.
• France, Germany and UK are among the more progressive nations in Europe, with adoption in all key applications today.
• Asia Pacific houses the most progressive markets like Japan and South Korea and potential volumes from China and India. However at the same time, a large part of this region, in contrast, is extremely nascent, if not underdeveloped.
• Asia Pacific currently consumes over 49% of smart cards shipped globally.
• North America – contactless gaining healthy growth via payment application
• MCU cards gaining Momentum
4
Global Smart Cards Overview: Percentage Split by Region
Source: Frost & Sullivan
Percentage Split by Region (Units)
•LA
Latin
America
(LA) 4.3%
Europe Middle
East Africa
(EMEA) 39.4%
Asia Pacific
(APAC)
44.8%
Infancy Early Growth Late Growth MaturitySegment Life Cycle Stage
North
America
11.5%
Smart Cards Life Cycle by Region, 2007
Source: Frost & Sullivan
Percentage Split by Region (Units)
•LA
Latin
America
(LA) 9.5%
Europe Middle
East Africa
(EMEA) 35.7%
Asia Pacific
(APAC)
49.3%
Infancy Early Growth Late Growth MaturitySegment Life Cycle Stage
North
America
11.5%
North
America
5.4%
Smart Cards Life Cycle by Region, 2008
5
APAC Market Dynamics
High population.India = 1.1 billion
China = 1.3 billion
New technologyacceptance levels
highEg: Japan, Korea
Rising Income Levels.
Improvement in standards of living
Manufacturing Hub of the world.
Densely populated regions.
Majority of markets far from saturation
Minimal legacy systems in Tier 3
countries
Source: Frost & Sullivan
6
APAC Smart Cards Overview: Estimated Market Size
2006 Total Asia Pacific Smart Card Market
Others 34%
SIM60%
Mobile Communication
Government ID Mass Transit
APACKey Smart Card Applications
Corporate Security Banking/ Loyalty
Others
Source: Frost & Sullivan
2008 APAC total smart card shipments = over 2 billion units (to grow to over 3 billion by 2015 )
In 2008, SIM was still the key application with approximately 70% of total smart card volume in the region
2008 Total Asia Pacific Smart Card Market
SIM 70%
Others30%
Source: Frost & Sullivan
7
APAC SIM Market: Key Market Drivers
Increasing useIncreasing useOf Over The Air Of Over The Air (OTA) facilities(OTA) facilities
Moves to 64KMoves to 64KSIM drives SIM drives
MarketMarketForwardForward
SIM Based SIM Based Solutions Solutions
increase value of increase value of SIMSIM
Volume inVolume inIndia explodingIndia explodingAs China coolsAs China cools
offoff
Source: Frost & Sullivan
8
APAC SIM Market: Key Market Restraints
Convergence Convergence raises business raises business model issues & model issues &
push market push market forwardforward
Saturation in Saturation in major cities stuns major cities stuns
the marketthe market
Low end SIM Low end SIM slows down slows down
revenue growthrevenue growth
Source: Frost & Sullivan
9
SIM Market in APAC: Estimated Market size and forecast
Asia Pacific SIM: Unit Shipment
-
500
1,000
1,500
2,000
2,500
3,000
2008 2009 2010 2011 2012 2013 2014 2015
Year
Un
its
(Mil
lio
n)
• In 2008 approximately over 1.6 billion SIM cards were shipped in APAC
• With CAGR of 5-6 % in the next 6-7 years
• Contributes to growth of MCU card shipments
Source: Frost & Sullivan
10
Mobile subscription: Current State
Total number of mobile subscribers
Gro
wth
in
new
mo
bil
e s
ub
scri
ber
s
M’sia
South Korea
Philippines
ChinaIndia
Japan
Saturation
Volume growth in SIM
Opportunities: Differentiation in saturated market - increase revenues per user.
Source: Frost & Sullivan
11
Trends in SIM adoption
SIM Capacity & ASPs
16K32K 64K
128K
Above 128K
Contactless Mobile Transactions Continue to Rise Steadily
Maturity of mobile phone/services adoptionSource: Frost & Sullivan
12
New Developments : HDSC Making In-Roads
• HDSC is expected to be an important leap for SC
• Key Features/benefit of HDSC over a SC:-• Higher Memory/Card Storage• Better interface speed & processing• Improved Security• Candidate for Data Rights Management
High Density Smart Cards (HDSC)MomentousLeapFor Smart Cards
NascentStage
Price , Cheaper Options &Standards
LackBusinessCase
Source: Frost & Sullivan
13
New Developments: SIM Market-Opportunities
APAC SIM Market
Opportunities
Emerging Markets
Mature Sophisticated
markets
Volume Growth
Ripe for advanced capabilities such as
contactless SIM and NFC to take off
Cheaper lower end SIM cards
More expensive higher end
cards
APAC as a whole still holds vast opportunities for mobile operators and SIM vendors . It is a high growth market and the mobile communication market is still evolving in a way that presents exciting opportunities for vendors in the smart card scene.
Source: Frost & Sullivan
14
New Developments: Contactless Gaining Momentum
•Debit/Credit cards•Loyalty•Prepaid/Stored Value
• Micropayment
Contactless SC Technology
Key Applications
Mass Transit
Payment/Banking
Access Control
Government
Multi-Application• Driving License
• E-Passport• Welfare• National ID
• AFC• ETC• Public Parking
• Physical Access
• Logical Access
• Dual access
Source: Frost & Sullivan
15
New Developments: Integrated Smart cards with Other Auto ID- RFID
Similarities Similarities•Contactless interface
•Card and reader communicate via radio frequency
Applications
•Transportation application
•Physical access control application
RFID Contactless Smart Card
Source: Frost & Sullivan
Much wider frequency range from <135KHZ (low
frequency) to >2.45GHz
Much wider frequency range from <135KHZ (low
frequency) to >2.45GHz13.56Mhz Frequency only
13.56Mhz Frequency only
Single applicationSingle application
Multi-application (eg, same card can be used for e-
payment and door access).
Multi-application (eg, same card can be used for e-
payment and door access).
Much wider read range possible.Much wider read range possible.
Limits interaction between card and reader to 10cm
distance
Limits interaction between card and reader to 10cm
distance
Active or PassiveActive or Passive
Card not poweredCard not powered
Contactless interface onlyContactless interface only
Able to incorporate contact and contactless interface on
one chip (dual/combi)
Able to incorporate contact and contactless interface on
one chip (dual/combi)
RFID Contactless Smart Card
Source: Frost & Sullivan
Differences
16
New Developments: Various Single /Common Form Factors
STANDARDPLASTICCARDS
USB DEVICES
MOBILE NFC DEVICES
TOKENS
PASSPORTS
MINICARDS
HIGH POTENTIALHIGH POTENTIAL
STANDARD FORM
STANDARD FORM
NICHE MARKETNICHE MARKET
NOVELTYNOVELTY WRISTBANDS
& WATCHES
Source: Frost & Sullivan
17
New Developments: Various Single /Common Form Factors –Novelties (Contd.)
USED FOR
Commemorations
Marketing Gimmick
Market Exploration
(Trial Runs)
Sponsorship and Advertising
SUCH AS
Plush Toys
Accessories – Pendants, Necklaces and so forth
Watches & Wristbands
KeyChains, KeyFobs and so on
Source: Frost & Sullivan
18
New Developments: Mobile NFC
5
FAR EAST: MOBILE NFC
INFRASTRUCURE IMPLEMENTED
POTENTIAL COUNTRIES FOR
MOBILE NFC INFRASTRUCTURE
THE REST OF ASIA; YET TO ADAPT SUCH
TECHNOLOGY
Combination with existing technology
Taps into the mobile network
Consolidation of different services
Content & credit management
Source: Frost & Sullivan
19
APAC: Market and Technology Trends in APAC – NFC (Near Field Communication)
2006 & 07: trials, 2006 & 07: trials, acceptance acceptance
testing testing &standards &standards
settingsetting
Using Using Contactless SC Contactless SC
technology – technology – mobile devicesmobile devices
Convergence of Convergence of contactless SC contactless SC
apps on 1 apps on 1 platformplatform
APAC: South APAC: South Korea and Japan Korea and Japan leads way with leads way with
highest usage of highest usage of contactlesscontactless
Availability of Availability of handsetshandsets
Equitable Equitable business business
modelmodel
Interoperability Interoperability & standards& standards
Contactless Contactless smart card smart card
infrastructureinfrastructure
TSM and TSM and support support
service for service for multi-appsmulti-apps
Current StateFuture State: Mass Deployment
Outstanding key factors
Source: Frost & Sullivan
20
Asia Pacific Takes the lead in Smart Card Shipment
Key Applications –SIM, Government, Transport & Banking
Convergence of smart card applications on SIM - mass transit, payment, access control, etc –on various forms & integration with other auto-ID technologies
SIM Market Continues to Grow with Promises from Contactless & NFC
Telcos - Focus on more value added services that bring in higher revenue per user in more saturated markets.
Opportunities for mobile phones to serve the financial needs of un-banked population in developing countries through mobile transactions.
Pre
sent
Mar
ket
Con
ditio
ns
Fut
ure
Mar
ket
Con
ditio
ns
APAC: Direction & Technology Trends
Thank you
Questions & Answers
22
Highlights of 2009 GLOBAL Smart Card Research
Research Titles Type of Service
Draft Smart Card Market size MI
World Smart Card Market ME
World Smart Card SIM MI
World Smart Cards for Banking MI
World Smart Cards for Government MI
World Smart Cards for Transportation MI
World Smart Card IC Market ME
World Contactless Smart Card ME
World Readers & Chipsets ME
World M2M ME
World Corporate security (inc Smart USB) ME
World PayTV Market ME
World Smart Card Management Systems ME
NOTE:1- ME : Market Engineering2- MI: Market Insight
23
Highlights of 2009 ASIA PACIFIC Smart Card Research
Research TitlesType of
Service
APAC Smart Card Outlook 2009 MI
APAC Smart Card Management System ME
APAC Smart Card Printers MI
Profiles of local Companies: Smart Card Value Chain ME
Smart Card Third Party Testing MI
Chip & PIN in Asia (banking/payment) MI
South Korea Smart cards Market ME
Near Field Communication MI
Asia Best practices/Cases for Contactless Convergence MI
Asia Pacific Smart Card IC on Different Form Factors ME
NOTE:1- ME : Market Engineering2- MI: Market Insight3- Analyst Briefing
24
Global : Smart Card Research Subscription- 2008
Highlights of GLOBAL Smart Card Research
Research Titles Type of ServiceGlobal Smart Card IC Study ME
Global Smart Card Study MEGlobal SIM Smart Card Study ME
Global Banking and Loyalty Smart Card Study MEGlobal Corporate Security (Logical and Physical Access Control) Smart Card Study ME
Global Government and ID Smart Card Study ME
Global Contactless Smart Card ME
Global Readers & Chip Sets Study ME
NOTE:1- ME : Market Engineering
25
Highlights of ASIA PACIFIC Smart Card Research
NOTE:1- ME : Market Engineering2- MI: Market Insight
Asia Pacific : Smart Card Research Subscription - 2008
Research Titles Type of ServiceIntegrated Smart Cards and Biometrics MEAPAC Smart Card Outlook: 2008 MIAPAC e-Passport MIMass Transit & Banking: Barries to convergence and multiapplication MISmart card:Untapped Markets in Asia MI
Emerging Applications in Selected APAC Countries MIAPAC Integrated SC IC Technology on different form factors MIVarious role of SIM MIAPAC Smart card management Systems MEAPAC e-Passport Market ME