Smart Cards Poised To Offer Wireless Access In Korea, Fight Fraud In Qatar, And Expand In U.S.

The market for smart cards is growing in the United States, but outside of some key government and financial services industry implementations, smart card adoption still lags way behind what's found in the international community.

In South Korea, smart card and digital security provider Axalto N.V. and Korean telecom provider KT Thursday introduced the first commercial wireless broadband, or Wibro, Universal Integrated Circuit Card (UICC) smart card. This technology will, beginning in June, let KT subscribers connect to Korea's wireless broadband mobile WiMax service, which is based on the IEEE 802.16e standard and can provide a maximum throughput of 18 Mbps.

Even better, the Wibro UICC card is designed to prevent illegal terminal or card cloning and fraudulent use while offering users the ability to access Wibro services from PCs, PDAs, or smart phones. This new smart card technology should present new opportunities for KT to provide more advanced services such as banking, stocks monitoring, and shopping via mobile devices.

While South Korea explores new commercial smart card possibilities, the State of Qatar, on the Saudi Arabian peninsula, said Wednesday it plans to in early 2007 issue to its citizens credit card-sized biometric smart cards containing name, birth date, address, and other personal information, as well as biometric fingerprint data stored on Axalto smart cards. The smart cards will serve as official proof of national identity and residency and will also be used as a passport and provide access to government E-services.

Microchips found in smart cards are a key element in the growing market for E-passports, which store the holder's photograph, name, gender, date of birth, nationality, passport number, and passport expiration date. To meet the demands for this market, Datacard Group Wednesday introduced its Datacard PB6500 passport issuance system, intended to use smart card technology to help governments defend against fraudulent passport usage and identity theft. The PB6500 lets passport issuers embed secure login information, data encryption, and biometric authentication within their countries' passports.

Despite the slow start in the West, smart card adoption in North and Latin America is expected to grow rapidly over the next five years, says an August 2005 report by the Smart Card Alliance and consulting company Frost & Sullivan. The report estimates that 132.2 million smart cards were shipped in North America in 2005 and that there will be more than a 27% compound annual growth rate in this market through 2010. There were about 136.4 million smart cards shipped in Latin America last year, and that market is expected to grow at a 59% compound annual growth rate through the end of the decade.

Subscriber Identity Module (SIM) chips, such as those shipped in cell phones, are the most common use of smart cards, followed by payment systems, pay TV, government identification, and access control. SIM's share of market is expected to drop over the next five years as these other applications become more widely deployed, the report says.

One of the biggest drivers for growth in the government smart card market is Homeland Security Presidential Directive-12, which has spurred the government to issue smart card IDs to millions of government workers, particularly within the Defense Department. Access control to computer systems and facilities--the convergence between physical and network security--is a big driver in the business world.