The uptake of smart cards is likely to stall with the emergence of alternatives such as proximity and magnetic stripe cards unless they embrace these new technologies, according to analysts Frost & Sullivan.
For example, even though USB is a potentially rival technology, USB dongles using embedded smart cards in SIM format increase overall efficiency. These USB tokens use a smart card-based network login system that eliminates the need for an actual card reader. The device can be plugged into a computer’s standard USB port to authenticate users.
Not all users, however, require the multi-application advantage of smart cards. It makes better business sense for them to opt for a single-purpose card. For example, proximity cards are less expensive than contactless cards for physical access control; consequently, organizations prefer this technology. “Managing existing identifications systems alone is a huge expense for many companies,” says Frost & Sullivan research analyst Jafizwaty Haji Ishahak. Because they are capable of balancing initial costs with the highest security architecture, smart cards provide a proven cost-effective solution
“Smart cards are well positioned to keep pace with changing end-user demands as they are easily compatible with other systems,” notes Ishahak. “Manufacturers should try to take advantage of smart cards’ superior efficiency and incorporate them with other emerging technologies to maximize profits.”