It's in the Cards

Smart cards face a bright future in the U.S. market

By Barbara A. Bucci

Europeans love them. Asians are leading the market with increased usage. But current U.S. sales and implementation of smart cards and their required infrastructure continue to lag.

However, according to data compiled in the report Global Smart Card Opportunities, 1997-2002, by Datamonitor, New York, the future of the U.S. smart card market looks bright. For example, the study states that although 3.85 billion smart cards will be issued globally by the year 2002, with Europe as the world's largest market, U.S. usage will grow the fastest worldwide--at a "yearly growth rate of 107 percent."

What does this mean for distributors who are considering entering this market? According to Dan Cunningham, president and CEO of the Smart Card Industry Association (SCIA), Lawrenceville, N.J., here are the most popular current or growing applications for smart cards.

Electronic commerce. "This market shows real growth," said Cunningham. "You can use the smart card to secure Internet or intranet purchases. The card would function as a secure token to authorize and secure transactions."

Colleges and universities. Students and faculty can be issued an ID card that also features a chip for a variety of applications, such as tracking purchases at book stores, vending machines, laundromats, secure Internet access for administrative or registration records and physical dorm access.

"There are 20 colleges in the United States that are using these already or are in the process of implementing them," said Cunningham.

Other applications include digital cellular phone cards and digital satellite functions (where the card is used as a security device on a box that sits on top of a television to provide keys for unscrambling incoming signals).

With the above-noted markets projecting steady growth during the next four years, marketing becomes even more important. Of course, selling or reselling main components of the smart card infrastructure is also important.