A senior Transport for London executive says the read-speed of NFC-enabled mobile devices is too slow for practical use on the capital's transit network.
Speaking at a mobile conference this week, Shashi Verma, director of customer experience for Transport for London, said the tube and bus network needs read-speeds up to a maximum of 500 milliseconds to handle rapid passenger throughput at peak travel times.
TfL ran successful tests of mobile access using a Nokia handset in 2007, but Verma says that industry changes since then to switch the secure element from the phone to the SIM has slowed the read speed down to above the 500 millisecond cut-off point. TfL's own Oyster cards operate at a read speed of 300 milliseconds.
The news is a blow to proponents of NFC technology, which see transit payments as a key facility in encouraging user acceptance of mobile devices for consumer spending.
In the UK this week, PayPal introduced its own mobile shopping initiative which eschews the use of NFC in favour of an app that scans barcodes and generates a transaction number for mobile payments at the checkout. The company believes that NFC is to far behind the curve for rapid adoption on the high street, with too few phones and Eftpos terminals equipped to handle the technology.
But in a report published this week by Credit Suisse in New York, analysts at the investment bank analysts suggest that 2012 could prove to be an "inflection point" for NFC adoption.
"Overall, we see the NFC semiconductor market as a large opportunity for chip suppliers driven by increasing mobile payment transactions, higher attach rates for NFC in mobile devices, and the convergence of the mobile payments ecosystem with partnerships across smartphone OEMs, service providers, financial institutions and MNOs," states the report. "We see an opportunity for the industry to ship up to 120 Million mobile NFC units in 2012, up from the modest 45-50 Million units in 2011."
Credit Suisse says efforts by Google and the telco consortium Isis to push the technology in the US, and the accelerating adoption of new technologies generally should result in "meaningful mobile payments volume within the next three years".