Read Rates and Tag
Prices"> You start to ask fundamental questions, and its increased the sales cycle. The sales cycle tends to go from 18-24 months from pilot to full deployment. Thats what were seeingmany, many more pilot deployments than in the past. Can you quantify how many pilot deployments youve seen in the recent past?Going forward [with Motorola] will your focus be on tags, readers, inlays or elsewhere? Our focus is on systems. So what weve noticed is our customers come to us for an RFID systemthey want to make sure that whole end-to-end system works. We have our tag product portfolio, our reader product portfolio. But as youll see, we keep talking about the RD5000 but its actually a system. The tag is built to work in concert with the RD5000its not exclusivebut it can help optimize [read rates]. We feel that if youre going to deliver RFID technology, you need to be able to understand both aspects. Not until the day where tags may be very easy to produce and everybody can guarantee service level agreements that a tag is going to read X percent of the time with this particular level of probability. Its not until that level of [service] that youll see us consider where we scale on tags. So at this point of time, its a necessary entity. And at this point in time, our customers see it that way too. They want one throat to choke. Where are read rates now, and where are tag prices at now? Theres always that 5 cents a tag goal. Five cents a tag, thats a commodity consumable market. We tend to participate in markets that are not consumable tags, which tend to be dollars and not cents. We think active UHF RFID is a great space to be in, that has a lot of promise. Click here to read about Symbols history with RFID technology. I anticipate youll see a lot more products coming out from us in the very near future that will start to accelerate that particular market. And our tag product portfolio continues to increase at the same time. Our read rates are sometimes 95 percent, sometimes 100 percent, depending on the environment. In terms of vertical industries, where are you focusing and where do you intend to go? Aviation, especially these days, we see a 20 percent increase in bags being checked. Primarily with RFID I see a tale of two marketsthe mandate driven market and the ROI [return on investment] driven market. The mandate driven market, everyone just looks at as the Wal-Mart driven market, but meanwhile whats really going on is in excess of 85 percent of our pilots are ROI pilots. These are pilots that customers are deploying because there is a definitive ROI. Its not a push; its a hey look this makes absolute sense for my business. It doesnt mean the mandate doesnt make sense, Im just saying that its not someone else driving their RFID strategy, its actually ROI thats driving strategy. Of that 85 percent, what industries are customers coming from? Retail, asset management, asset tracking, inventory tracking, pharmaceutical, e-pedigree, areas like those. Do you ever see going into the applications business, for example middleware that sits directly on a reader? One thing that grows a technology out from nascent to mainstream is everybodys RFID, their technology savvy-ness in that area. So bringing the ecosystem of partners up in the knowledge and awareness of that particular product, and part of that is making sure that applications are RFID aware and RFID capablethats what we do. So getting into RFID applications is not necessarily something we would do. What we would do is work with a partner to make that easier. What we would tend do is work with a partner to develop an application and they own that application. And what we definitely do is make that easier. We developed a common set of application interfaces that makes it easier for our partners to develop on, that gets their product to market very, very quickly. And thats where our focus is. Check out eWEEK.coms for the latest news, reviews and analysis on mobile and wireless computing.
Sure. In Q1 we had 15 pilotspaid for pilotsand in Q2 we saw in excess of 40. Well see how Q3 plays out.