The much-touted RFID alternative was thrust into the spotlight with support from huge global retailers, which makes its lack of retail momentum ironic.
As the IEEE prepares next week to start focusing on the RuBee standard, the metal-and-water-penetrating RFID alternative is faring well with government and medical trials, said the executive primarily responsible for its launch.
Ironically, when RuBee first started getting attention about seven months ago
, it was partly because of strong support from leading global retailers, including the United States Best Buy, U.K.-based Tesco, Germanys Metro Group and Frances Carrefour. Thats ironic because retail is the area where RuBee has simply not gotten any traction, said John Stevens, CEO of Visible Assets and also the chairman of the working group handling RuBee, known in IEEE circles as IEEE 1902.1.
Stevens said his company is working with the U.S. Department of Energy with cell phone tracking in secure areas at about 25 separate installations, some travel companies, medical/pharmaceuticals and other areas, but that they are no longer actively working on any retail projects with RuBee.
Stevens, the man most closely associated with creating and launching RuBee, said there are a few reasons for the drying up of retail projects, but mostly its a matter of focusing on areas that are more financially attractive right away.
"Retail is such a low-margin, high-volume business, theres so much risk associated with it," he said. "Wal-Mart has created an environment that has eliminated all capital for RFID."
That has, Stevens said, colored the counsel his investors are giving. "Its hard to get anybody to get capital" for a retail push, he said. "None of our investors are doing anything to encourage us to be aggressive in retail. Weve got so many things where we can make money right now."
Pete Abell, a former IDC RFID analyst who now runs his own consulting firm called Kaleidoscope Technology Strategy, said RuBees business strategy is sound.
"RuBee is waiting for more large players and concentrating on areas where it makes good business sense," Abell said. "Getting into a commodity effort at this stage makes no business sense for them."
The only one of the initial retail backers that Stevens has on an active pursue list is Best Buywhich seemed to have some interest in a batteryless application with RuBeebut he said there are currently no active discussions.
Part of that is also the nature of RuBee, which does not lend itself to the high-speed nature of an assembly line or the rapid conveyor belts of a large distribution center. Its primary advantage is its ability to not be blocked by liquids and metals.
Thats much of the rationale of the Department of Energy projects, Stevens said, because the RuBee chip in the cell phone runs into less interference than would RFID. "They have tried RFID, [but] it hasnt been reliable because bodies, which are [primarily] water, block the signal," he said.
Retail Center Editor Evan Schuman can be reached at Evan_Schuman@ziffdavis.com
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