Smart Card Market Goes Multi-Application

SINGAPORE (04/11/2000) - Multi-application cards are likely to drive the next phase of smartcard adoption, said Amedeo D'Angelo, vice president, Smart Card Development, Oberthur Card Systems, in an interview.

According to D'Angelo, smart cards came of age in the 1990s with their first widespread global market application -- GSM phones.

"The GSM/SIM card is the first real application that justified the cost of the microprocessor," he said. "It currently accounts for 50 percent of smart card usage, with 30 percent from banking, and electronic commerce and multimedia taking 10 percent, with other miscellaneous applications the other 10 percent."

There are an estimated 1 billion smart cards in use today, and this figure is expected to grow to 3.4 billion by 2001.

The next development that will drive smart card adoption is multi-application card development, card operation standards, and falling costs, said D'Angelo.

"The multi-application card is now a reality," said D'Angelo. He feels the multi-application smart card is today the only realistic option for managing multiple electronic transactions. Multi-application cards are promizing as it will have an open platform where applications that reside on their virtual machine, can be deleted and replaced, he explained.

"It can be compared to the 1.44M-byte floppy disk, where there is only one type, but many different applications can reside on it. So the multi-application card allows interoperability, where different vendors can input their applications onto the same card," said D'Angelo.

In addition, a range of devices can access the multi-application card -- whether PCs, point-of-sales, mobile phones, or automated teller machines (ATMs). It also has encryption and digital signature capabilities, that can pave the way for use as content providers and cellular operators offer different services transactions to their customers. This new generation of smart cards will also drive the convergence the different smart cards used in its three core markets.

"The markets of GSM, banking and e-commerce/multimedia are merging, going towards e-commerce and wireless access through the Internet, where any electronic transaction can be managed on a single card," said D'Angelo.

However, D'Angelo noted that three major issues are affecting the roll-out of multi-application cards. A key issue is the lack of interoperability between card readers, where they differ depending on the different smart card access devices.

Another barrier is the integrity of applications that are being downloaded need to be guaranteed. Trusted third party networks need to be created to safeguard the access of private keys. A third barrier is a system to manage and control the smart card process.

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