Industry cooperation for a Near Field Communication (NFC) standard

Initiated in 2011, the NFC standard aims at leveraging mobile payment services in Europe by defining the tools to develop a SIM-based NFC ecosystem. This standard is currently developed with a cross-industry approach, involving primarily mobile network operators and handset-manufacturers.

The NFC standardization process engages over 40 industry players which allows for competition within a standard, contrary to quasi-monopolistic market structures often generated by proprietary platforms. Stakeholder involvement is also crucial to achieve critical mass when launching a new network service, such as NFC mobile wallets. Additionally, the NFC technology is also crucial for the introduction of services in other sectors such as transports, logistics and retail.

Given the pace of technological development and the level of global competition in the Telecom sector, it is essential for the NFC success that standardization is fast and takes into account the time-to-market of the product. The so-called Euro 5 initiative (including Deutsche Telekom, France Telecom/Orange, Telecom Italia, Telefónica and Vodafone) was a first initiative to speed up the crucially needed standardization process and interoperability of systems in order to develop business models.

The investigation opened by Commissioner Almunia led to legal uncertainty, required a change in the established working methodology and delayed the introduction of the product in the market.

To support these legitimate needs for coordination and time-to-market, the European Commission as a whole has a key role to ensure that strategic coordination across industries in standard setting is facilitated and promoted.

Competition law should not be an obstacle to standardization processes. Particularly in those industries where interoperability is at stake, the need for cooperation among competitors should be understood by the authorities. There is no need to change antitrust rules but implementation of competition policy and practice of authorities should be done with sufficient flexibility to achieve the time-to-market needs of markets and business.