Post on 20-Aug-2015
Asia OpportunitiesAsia OpportunitiesSmart Card Opportunities in AsiaSmart Card Opportunities in Asia
Damien See, Senior Industry Analyst
Information & Communication Technology
15 November 201115 November 2011
Today’s Presenter
Damien See, Senior Industry Analyst
Frost & Sullivan
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• 10 years of professional experience spanning a range that includes technical
project management and implementation of RND engineering assignments to
ICT-based product planning and development
Focus Points
• Smart Cards in Asia – An Overview
• Asian Smart Cards: Drivers & Restraints
• Asian Opportunities, Identified
• The Future of Smart Cards in Asia
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Poll Question
Do you think Asia will dominate the smart card industry in 2020 in terms of revenue?
YES
4
YES
NO
Decline to answer
Smart Cards in Asia
• The smart cards industry in Asia affects a wide range of the
consumers in the ecosystem
• From the smart card manufacturers themselves, to banking
institutions, to the credit card companies, to the solution
providers, and ultimately to the end customers – the smart card is
key in today’s modern world
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• Properly implemented, smart cards in all sectors has proven very
effective in combating theft and fraud
• Clients who are interested in what 2020 has to offer for this
region will find this analyst briefing especially relevant
Present Current and Future Key Trends
Current:
1. Disparity in standardization
2. Many participants & players
3. Little cooperation and specialization
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Future:
1. Streamlined standards
2. Oligopoly-type environment
3. Convergence & specializations
Smart Cards in Asia: An Overview
Asia Smart Cards: Drivers & Restraints
Asian Opportunities, Identified
The future of Smart Cards in Asia
Smart Cards in Asia: An Overview
7
The future of Smart Cards in Asia
Smart Cards in Asia: An Overview (continue)
Units
millionsGrowth
Revenue
US$
millions
Growth
2009 2584 - 2286 -
2010 3065 18.6% 2612 14.3%
2011 3354 9.4% 2725 4.3%
Smart Card Market: Unit Shipment and Revenues
(APAC), 2009-2017
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2011 3354 9.4% 2725 4.3%
2012 3645 8.7% 2862 5.0%
2013 3984 9.3% 3008 5.1%
2014 4372 9.7% 3191 6.1%
2015 4820 10.2% 3404 6.7%
2016 5347 10.9% 3642 7.0%
2017 5916 10.6% 3894 6.9%
CAGR
(2010-2017) 9.8% 5.9%
Note: All figures are rounded; the base year is 2010.
Source: Frost & Sullivan
Smart Cards in Asia: An Overview (continue)
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Note: All figures are rounded; the base year is 2010. Source: Frost & Sullivan analysis.
Smart Cards in Asia: An Overview (continue)
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Note: All figures are rounded; the base year is 2010. Source: Frost & Sullivan analysis.
Smart Cards in Asia: An Overview (continue)
GOVERNMENT & ID market
6%
TRANSPORTATION market
4%
PAY TV market1% CORPORATE
SECURITY market1%
OTHERS market2%
SC breakdown in APAC for 2011
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SIM market78%
BANKING & PAYMENT market
8%
Smart Cards in Asia: An Overview
Asia Smart Cards: Drivers & Restraints
Asian Opportunities, Identified
The Future of Smart Cards in Asia
Asia Smart Cards: Drivers & Restraints
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The Future of Smart Cards in Asia
Asia Smart Cards: Drivers & Restraints (continue)M
ark
et
Dri
vers
1-2 years 3-5 years 6-10 years
Government Projects drives demand for smartcard
usage within many sectors, notably national ID
Security Concerns, particularly within the
public sphere will drive demand for smart
cards
Transportation & Urbanization drives demand for
more effective methods to manage commuters
Smart Card Market: Key Market Drivers (APAC), 2010-2017
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Mark
et
Dri
vers
cards
Growth of smartphones necessitates
the adoption of high-capacity SIM
Source: Frost & Sullivan analysis.
Impact: High Medium Low
Asia Smart Cards: Drivers & Restraints (continue)M
ark
et
Restr
ain
ts
Alternative and Existing Infrastructure such
as magnetic stripes slows the pace of
development
Privacy Concerns over the amount of
information that can be tracked by the
government and merchants raises concerns
1-2 years 3-5 years 6-10 years
Smart Card Market: Key Market Restraints (APAC), 2010-2017
14
Mark
et
Restr
ain
ts
Lack of Clarity on an Appropriate Business Model especially within NFC and even M2M segment may
hinder growth
development
Impact: High Medium Low
Source: Frost & Sullivan analysis.
Smart Cards in Asia: An Overview
Asia Smart Cards: Drivers & Restraints
Asian Opportunities, Identified
The future of smart Cards in Asia
Asian Opportunities, Identified
15
The future of smart Cards in Asia
Asian Opportunities, Identified (continue)
12.94
31.35
61.21
111.19
20
40
60
80
100
120
140
NFC Payment: Transaction Value Estimation (World), 2011-2015
NFC
16
3.8412.94
0
20
2011 2012 2013 2014 2015
World (in € billions) Expon. (World (in € billions))
NFC Applications
Contactless Payment
Discount Coupons
Niche Advertisements
India
Japan & South Korea
• In Japan, Mobile Suica is actively used in their transit system (NFC)
•South Korea HomePlus deployed solution allowing public transport passengers to purchase groceries while waiting for trains through mobile phones
China
•2.5 million SIMpass (NFC-bridge solutions) has been delivered in China by Watchdata
•With over 1.3 billion population, and 68% mobile penetration –China has a “ready”
Some Interesting Insights of ASIA
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India
• Similar to China, India also has a huge population with ready access to SIM
•India is actually growing faster than China in mobile phone usage
market in SIM
Indonesia & Philippines
•Mobile branchless (pilot) banking projects
•Mobile phone are used for banking transactions
Smart Cards in Asia: An Overview
Asia Smart Cards: Drivers & Restraints
Asian Opportunities, Identified
The Future of Smart Cards in Asia
The Future of smart cards in Asia
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The Future of Smart Cards in Asia
The Future of Smart Cards in Asia (continued)
Pay as You Drive
Car Sharing Apps Store
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New Business Models made possible with smart cards as the enablers and
secure elements
The Future of Smart Cards in Asia (continued)
Phone Broadband Pay TV Mobile & Content
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Many operators in APAC are moving towards bundling their
services to increase customer retention and increasing their
revenues by efficiently utilizing their infrastructure.
Content
Convergence is the KEY!
• Highly fragmented market to be unified
either by consolidation or partnerships
• Integration of siloed systems in a workflow
Market
TrendsConvergence
Consolidation
& Partnerships
Peak activity between
now and 2015
• Blurring the lines for service providers, content
creators and device makers
• Need to make applications and content available to
customers anytime, anywhere, any device – on
demand!
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• Asia Pacific growing rapidly
• Still evolving in terms of adoption of next
generation services and products and hence
present a growing opportunity
• Services present great revenue potential
• System Integration is emerging as a key driver in the market
Emerging
Markets
Increasing
role of
Professional
Services
Peak activity 2012 to
2017
Peak activity
2015 to 2020
Sm
art
Ca
rd i
s
the
EN
AB
LE
R!
Key Take-Aways
• Convergence
• Asia Pacific presents a growing opportunity for smart card
players
• Services to present the greatest potential revenue stream
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• System integrations is a key driver
• Consolidations and partnerships across many verticals
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For Additional Information
Joanna Lewandowska
Corporate Communications Manager
ICT
+48 (0) 22 390 41 46
joanna.Lewandowska@frost.com
Gustavo Cury
Sales Manager
ICT
+44 (0)20 7343 8310
gustavo.Cury@frost.com
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Damien See
Senior Industry Analyst
ICT
+ 60 3 6207 1018
damien.see@frost.com
Jean-Noël Georges
Global Program Director
ICT
+33 (0) 4 93 00 61 87
jean-noel.Georges@frost.com