Shipments of smart cards are poised to grow at an annual
rate of 27.7 percent according to a new joint study by the
Smart Card Alliance and research firm Frost & Sullivan. The
report, “Americas Smart Card Market Analysis,” says that
government and access control applications will make up
just a portion of what is becoming a rapidly growing
market.

That said, the analysis finds the percentage of the smart
card market for security applications will jump from 5
percent in 2005 to 17 percent of the market by 2010. The
report also says smart card shipments will top 132 million
units by the end of this year and grow by nearly 28 percent
each year through 2010.

“The growth of the smart card market is higher than we even
anticipated, but when you look at the report, it makes
sense,” Smart Card Alliance Executive Director Randy
Vanderhoof told Security Sales &
Integration. “You’re looking at better than a 10-fold
increase.”

The largest driver for the market, according to the report,
has been demand for subscriber identity module (SIM) cards
used for digital phones. However, the report says SIM cards
will play a lesser role in the coming years in North
America, as payment and security will be the main uses for
smart cards.

Vanderhoof says the government market is setting the tone
for smart card security applications.

“Those commercial numbers have been fairly moderate up
until now, but I believe developments we’ve seen in the
federal government space creates a blueprint for the
commercial sector to follow,” says Vanderhoof. “Right now,
we’re addressing the immediate customer base, which is the
government.”

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