Philips sells chips for 'next big thing' to Samsung

Philips Semiconductors has announced Samsung will make mobile phones that use its Near Field Communication (NFC) chips.

NFC is a relatively new wireless standard that sits somewhere between radio frequency ID (RFID) tags, increasingly used in manufacturing, logistics and retail, and technologies such as Bluetooth and Wi-Fi, which are used up to distances of 100 metres or so mainly for data transfer. (Like Bluetooth, NFC is normally P2P, unlike Wi-Fi, which is normally - though by no mean always - between an access point and clients.)

NFC has been pioneered by Philips and Sony but the consumer electronics giants now point to it as a standard, with ISO and ETSI classifications.

Sour Chhor, general manager at Philips Semiconductors' Contactless and Embedded Security division, said: "NFC is a complementary technology. It is not about connectivity because of its operating distance but it is easy to set up. It will enable Bluetooth and Wi-Fi; it's what you need to set up the many parameters grandpa and grandma won't do."

The fact that NFC should always be very intuitive makes it ideal for transferring data such as digital images between, for example, cameras and TV sets, at speeds of up to 424Kbps. This is clearly an attraction for a Philips or Sony.

Samsung in a statement today talked about the way it will use NFC "to change the way information and services are paid for, distributed and accessed".

The Korean company and others predict it will first appear in the most ubiquitous device - the mobile phone. Philips' Chhor wouldn't say exactly how much silicon for NFC currently costs. When Bluetooth started to be incorporated in devices in volume - especially mobile phones - it was after the price dipped under $5 per radio chip.

"NFC will [end up being] much cheaper than Bluetooth," Chhor added.

NFC's line up of prominent backers also includes Nokia and Universal Music. The NFC Forum was launched at the CeBIT trade show earlier this year.