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Smart Card Opportunities in Asia

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A presentation on smart card opportunities in Asia.

A presentation on smart card opportunities in Asia.

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  • 1. Asia Opportunities Smart Card Opportunities in Asia Damien See, Senior Industry AnalystInformation & Communication Technology 15 November 2011
  • 2. Today’s Presenter Damien See, Senior Industry Analyst Frost & Sullivan• 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 2
  • 3. Focus Points• Smart Cards in Asia – An Overview• Asian Smart Cards: Drivers & Restraints• Asian Opportunities, Identified• The Future of Smart Cards in Asia 3
  • 4. Poll Question Do you think Asia will dominate the smart card industry in 2020 in terms of revenue? YES NO Decline to answer 4
  • 5. 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• 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 5
  • 6. Present Current and Future Key Trends Current:1. Disparity in standardization2. Many participants & players3. Little cooperation and specialization Future:1. Streamlined standards2. Oligopoly-type environment3. Convergence & specializations 6
  • 7. Smart Cards in Asia: An OverviewSmart Cards in Asia: An OverviewAsia Smart Cards: Drivers & RestraintsAsian Opportunities, IdentifiedThe future of Smart Cards in Asia 7
  • 8. Smart Cards in Asia: An Overview (continue) Smart Card Market: Unit Shipment and Revenues (APAC), 2009-2017 Revenue Units Growth US$ Growth millions millions 2009 2584 - 2286 - 2010 3065 18.6% 2612 14.3% 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 b ase year is 2010. Source: Frost & Sullivan 8
  • 9. Smart Cards in Asia: An Overview (continue) Note: All figures are rounded; the base year is 2010. Source: Frost & Sullivan analysis. 9
  • 10. Smart Cards in Asia: An Overview (continue) Note: All figures are rounded; the base year is 2010. Source: Frost & Sullivan analysis. 10
  • 11. Smart Cards in Asia: An Overview (continue) SC breakdown in APAC for 2011 TRANSPORTATION PAY TV market market 1% CORPORATE 4% SECURITY market 1% GOVERNMENT & ID market OTHERS market 6% 2% BANKING & PAYMENT market 8% SIM market 78% 11
  • 12. Asia Smart Cards: Drivers & RestraintsSmart Cards in Asia: An OverviewAsia Smart Cards: Drivers & RestraintsAsian Opportunities, IdentifiedThe Future of Smart Cards in Asia 12
  • 13. Asia Smart Cards: Drivers & Restraints (continue)Smart Card Market: Key Market Drivers (APAC), 2010-2017 1-2 years 3-5 years 6-10 years Government Projects drives demand for smartcard usage within many sectors, notably national ID Transportation & Urbanization drives demand forMarket Drivers more effective methods to manage commuters Security Concerns, particularly within the public sphere will drive demand for smart cards Growth of smartphones necessitates the adoption of high-capacity SIM Impact: High Medium Low Source: Frost & Sullivan analysis. 13
  • 14. Asia Smart Cards: Drivers & Restraints (continue)Smart Card Market: Key Market Restraints (APAC), 2010-2017 1-2 years 3-5 years 6-10 years Privacy Concerns over the amount of information that can be tracked by the government and merchants raises concernsMarket Restraints Alternative and Existing Infrastructure such as magnetic stripes slows the pace of development Lack of Clarity on an Appropriate Business Model especially within NFC and even M2M segment may hinder growth Impact: High Medium Low Source: Frost & Sullivan analysis. 14
  • 15. Asian Opportunities, IdentifiedSmart Cards in Asia: An OverviewAsia Smart Cards: Drivers & RestraintsAsian Opportunities, IdentifiedThe future of smart Cards in Asia 15
  • 16. Asian Opportunities, Identified (continue) NFC Payment: Transaction Value Estimation (World), 2011-2015140 111.1912010080 61.21 NFC6040 31.3520 12.94 3.84 Contactless 0 Payment 2011 2012 2013 2014 2015 World (in € billions) Expon. (World (in € billions)) NFC Applications Niche Discount Advertisements Coupons 16
  • 17. Asian Opportunities, Identified (continue) M2M 17
  • 18. Some Interesting Insights of ASIAChina Japan & South Korea•2.5 million SIMpass • In Japan, Mobile Suica is actively(NFC-bridge used in their transit system (NFC)solutions) has been •South Korea HomePlus deployeddelivered in China by solution allowing public transportWatchdata passengers to purchase groceries•Withover 1.3 billion while waiting for trains through mobilepopulation, and 68% phonesmobile penetration –China has a “ready” Indiamarket in SIM •Similar to China, India also has a huge population with ready access to SIM Indonesia & Philippines •India is actually growing •Mobile branchless (pilot) faster than China in banking projects mobile phone usage •Mobile phone are used for banking transactions 18
  • 19. The Future of smart cards in AsiaSmart Cards in Asia: An OverviewAsia Smart Cards: Drivers & RestraintsAsian Opportunities, IdentifiedThe Future of Smart Cards in Asia 19
  • 20. The Future of Smart Cards in Asia (continued) Pay as You Car Sharing Apps Store Drive New Business Models made possible with smart cards as the enablers and secure elements 20
  • 21. The Future of Smart Cards in Asia (continued) Phone Broadband Pay TV Mobile & ContentMany operators in APAC are moving towards bundling theirservices to increase customer retention and increasing theirrevenues by efficiently utilizing their infrastructure. 21
  • 22. Convergence is the KEY! • Blurring the lines for service providers, content Market creators and device makers Trends • Need to make applications and content available to Convergence customers anytime, anywhere, any device – on demand! Peak activity between • Highly fragmented market to be unified now and 2015 either by consolidation or partnerships Consolidation • Integration of siloed systems in a workflow & Partnerships Peak activity 2012 to Emerging 2017 Markets the ENABLER! Smart Card is• Asia Pacific growing rapidly• Still evolving in terms of adoption of next Increasing Peak activity generation services and products and hence role of 2015 to 2020 present a growing opportunity Professional Services• Services present great revenue potential• System Integration is emerging as a key driver in the market 22
  • 23. Key Take-Aways• Convergence• Asia Pacific presents a growing opportunity for smart card players• Services to present the greatest potential revenue stream• System integrations is a key driver• Consolidations and partnerships across many verticals 23
  • 24. Next Steps Request a proposal for our Growth Partnership Services or Growth Consulting Services to support you and your team to accelerate the growth of your company. (myfrost@frost.com) 1-877-GoFrost (1-877-463-7678) Join us at our annual Growth, Innovation, and Leadership 2012: A Frost & Sullivan Global Congress on Corporate Growth (www.gil-global.com) Register for Frost & Sullivan’s Growth Opportunity Newsletter and keep abreast of innovative growth opportunities (www.frost.com/news) 24
  • 25. Your Feedback is Important to Us What would you like to see from Frost & Sullivan?Growth Forecasts?Competitive Structure?Emerging Trends?Strategic Recommendations?Other? Please inform us by “Rating” this presentation. 25
  • 26. Follow Frost & Sullivan onFacebook, LinkedIn, SlideShare, and Twitter http://www.facebook.com/FrostandSullivan http://www.linkedin.com/companies/4506 http://www.slideshare.net/FrostandSullivan http://twitter.com/frost_sullivan 26
  • 27. For Additional InformationJoanna Lewandowska Gustavo CuryCorporate Communications Manager Sales ManagerICT ICT+48 (0) 22 390 41 46 +44 (0)20 7343 8310joanna.Lewandowska@frost.com gustavo.Cury@frost.comDamien See Jean-Noël GeorgesSenior Industry Analyst Global Program DirectorICT ICT+ 60 3 6207 1018 +33 (0) 4 93 00 61 87damien.see@frost.com jean-noel.Georges@frost.com 27

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