Issuing of Contactless Documents Pushes Electronic ID Markets to $1 Billion by 2012, Says Research

Citizens' concern over privacy issues still a major factor.

by / September 18, 2007

Spurred on by U.S. government mandates, the governments of many countries around the world are now issuing their citizens e-passports carrying biometric data. Further adoption, the issue of new e-passports, and the systematic replacement of existing passports represent a significant market for contactless technology.

The total market for contactless e-passport transponders alone is set to grow to nearly $300 million by 2012, while the total market for hardware software and services providing e-ID documents will reach nearly $1 billion by 2012, according to a new ABI Research study.

"As well as driving a growing market for contactless technology, e-passport adoption is also raising awareness and building a foundation for contactless to be adopted in a range of other government-issued personal ID applications including ID cards and regional travel permits," says senior analyst Jonathan Collins. "The potential for contactless ID cards clearly dwarfs that of the e-passport market."

While the United States has helped drive adoption of contactless e-passports, it is also playing a key role in testing the potential of a rival RF technology for travel document at its own borders. The Department of Homeland Security (DHS) has been exploring the use of UHF RFID technology at its land border with Canada.

UHF RFID technology was developed to provide low-cost RFID tags capable of transmitting a simple license-plate number without the need for on-board security or close contact with the interrogator. Significant work will be required to produce a system that will deliver the advantages sought while also taking citizens' concerns into account.

These PASS card projects, as well as some RFID driving license ID cards planned for testing in Washington and Vermont along the Canadian border, attempt to use wireless technology to increase security and speed throughput at land border crossings.

However, warns Collins, "ABI Research believes that RFID technology is ill-suited to the tagging of secure documents and is likely to create concern among citizens, given the greater read-range of the technology compared with high-frequency transponders. In the development of e-passports the U.S. government and international standards bodies took note of concerns over security issues. As the DHS develops its own criteria, ABI Research recommends that the same process be replicated."