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Electronics and Semiconductors

NFC and Bluetooth: Complementary or Competitive?

24 March 2011

Connectivity is an area in the automotive electronics segment that is expanding signi?cantly and is expected to trigger further incremental semiconductor usage in vehicles.

In particular, Bluetooth and near field communications (NFC) are two wireless technologies that are targeting in-vehicle connectivity. Both technologies have similarities and differences, which will determine how the two solutions will be used in vehicle applications.

Bluetooth Becomes Ubiquitous
Bluetooth, together with Wi-Fi, is the most diversified wireless technology, having been accepted in a wide variety of products ranging from mobile phones to laptop PCs, to tablets. This acceptance in various types of equipment has given Bluetooth a preferential path to be integrated in the car. There is a clear trend of consumer and mobile devices augmenting existing automotive infotainment systems.

To highlight Bluetooth’s success, 93 percent of 2010 cars in the United States are available with Bluetooth, many having it as a standard feature. General Motors started bundling Bluetooth with OnStar, which is standard with most GM vehicles. According to IHS iSuppli infotainment technology availability data, Bluetooth is available on a little more than 69 percent of all models offered for sale in 2010, in the nine core countries tracked. Attachment rates for Bluetooth, currently about 24 percent worldwide, will rise to 59 percent by 2017, according to IHS iSuppli data.

As a result, Bluetooth has become the de facto standard for wireless connectivity in vehicles, primarily used to accommodate hands-free calling with mobile phones. At the same time, there are new or maturing alternative Bluetooth profiles to accommodate data connections for music, messaging, basic control functions—and now mobile apps—rendered on the smart phone.

NFC Achieves Limited Automotive Success
NFC is a technology that has been developed by Philips Electronics and Sony Corp. As can be inferred from the name, NFC is a connectivity technology that allows interconnection among devices within a range of about 4 to 8 inches (10 to 20 centimeters).

Fast and easy operations together with a high security level make the technology suitable for secure communications like monetary transactions, private data collection, ticketing and generic information exchanges.

NFC vs Bluetooth 4.0NFC vs Bluetooth 4.0

NFC’s main advantage is its intrinsic security level, ensured by the limited communication range of the technology that, together with a single point-to-point connection, will limit any interception possibilities. On top of the intrinsic security, NFC technology supports advanced cryptography, which makes NFC-based systems suitable for financial and other kinds of secure transactions.

Despite such advantages, IHS does not believe that vehicles will be driving the NFC market growth. In-vehicle applications are still limited and mainly driven by security applications, such as car access keys or car immobilizers. These are the applications where NFC will add value compared with already available and reliable technologies like Bluetooth, which is now widely deployed in vehicles.

The market driver for NFC technology is, and still will continue to be, mobile handsets, where the technology is expected to be integrated soon on a wide scale, reaching about 220 million units by the 2014 time frame.

Automotive Solutions
It is clear that once such a wide scale deployment confirms NFC success, vehicles also will take advantage of the technology, allowing even more integration of devices like smart phones and related applications inside vehicles.

As for the present, NFC in automotive solutions is being offered by original equipment manufacturers such as BMW, by Tier 1 suppliers such as Continental, and by semiconductor providers such as NXP. All three, along with some other entities, are pioneering the deployment of NFC technologies in automotive applications.

The main uses of NFC in vehicles are:

  • Car access and car security
  • Car interior setup according to different drivers, such as infotainment, telematics, engine/chassis setup and preference configuration.
  • User authentication—car rentals
  • Support to wireless communication—such as Wi-Fi and Bluetooth—due to reduced setup time

Complementary Indeed
IHS expects NFC technology to be implemented in the car and coexist with today’s more mature and diffused technologies, such as Bluetooth and Wi-Fi. As a result, Bluetooth and NFC will be complementary technologies.

Not only will NFC’s higher level of security allow more applications to be run safely in the car, its faster set-up time also will permit other wireless technologies to take advantage of NFC’s faster authentication process.

Finally, in terms of cost, according to the NFC forum, integration into Bluetooth or other wireless technology of NFC—not as a standalone device—will have a negligible cost impact, in the range of U.S. $0.50 per unit. Integrating the small NFC IP block in a tiny corner of a Bluetooth chipset, for example, will reduce the overall bill of materials (BOM) cost and will allow using system-on-chip (SoC) connections instead of more expensive ad hoc external connectors.

Read More > IHS iSuppli’s Automotive Research Portal—Components & Devices

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