ViVOtech Is Now an NFC Software Company

by Mercator Advisory Group 0

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ViVOtech has sold its contactless readers busines to ID TECH, a well thought of manufacturer of point-of-sale and point-of-interaction hardware. The company is still breathing.

Once VeriFone and other POS terminal makers started building their own contactless readers instead of purchasing contactless assemblies from ViVOtech, the economics of contactless shifted and market attention moved to what the entire point of sale system can provide. As a firm firmly focused on contactless transactions, ViVOtech could not compete on both the fully featured hardware and software fronts.

So, divesting itself of its ViVOpay hardware business makes sense. Now, the firm is left with the opportunity to focus on its ViVOnfc software offerings that include trusted service manager (TSM) capability as well as payments and couponing software.

As a software pure play, ViVOtech joins no small number of providers, some far stronger, of software and services to the still nascent NFC ecosystem. NFC-equipped smartphones are finally coming to market in the U.S., but NFC-based payments face real headwinds as the proposition for both issuers and merchants remains murky. Commerce transactions facilitated by NFC that operate around but don’t include the contactless card emulation mode payment should do well over the next couple of years. Then payments may begin in volume.

Hopefully, ViVOtech now has enough runway to get into the air even as widespread NFC payments remain in the middle distance. NFC-based revenues, especially those based on transaction volume, are still a way off.

The company states that it has completed the sale of its ViVOpay reader business, effective today. The buyer is Cypress, California-based ID TECH, which manufactures and supplies smart card and credit card readers for secure PCI payment solutions, which are used in point-of-sale terminals and mobile applications. ViVOtech’s existing customer base and supplier relationships will be transferred over to the new owner. The NFC Times’ original report had stated that the likely buyer for the business was PAX Global Technology, the owner of Shenzhen, China-based PAX Technology, but that turned out to not be the case.

Unlike ViVOtech, ID TECH is not solely focused on NFC products, but also makes things like MagStripe card readers and writers, barcode readers, POS keyboards, secure PIN entry products and more. It sells to point-of-sale, hospitality, access control, gaming, transportation and kiosk industries through a host of VARs, OEMs and distributors.

In an additional statement, also posted online, ViVOtech says that with the sale of the reader business behind it, it will now focus on its ViVOnfc Software business instead. “We are focusing 100% of our energy on the continued support of our customers, contracts and partners, and on growth of this business,” reads the official statement, which was just shared with us courtesy of ViVOtech CEO Mick Mullagh.

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