RFID: Still Searching for Payoff

Don't expect rock-solid business cases to emerge, but products are evolving.

RFID World, the Auto ID conference being held in Dallas this week, will feature a big crowd, small incremental technology advances and a continuing search for a business case.

Theres little doubt that radio-frequency identification has become a hot topic—4,500 people are expected to attend this years event, compared with 3,000 the year before; there are 199 registered exhibitors, nearly 70 more than last year; and nearly two dozen companies are expected to announce new technologies.

Whats missing? A compelling ROI. Also missing are seismic advances in RFID business case findings—the actual rationale needed for large-scale implementations, according to industry analysts.

/zimages/4/28571.gifSymbol CEO Sal Iannuzzi thinks RFID isnt ready for prime time yet. Click here to read more.

Sven Ahlberg, CEO of Trakker Technologies, in Bozeman, Mont., is using RightTags handheld wireless reader to support his companys trade show business, which supplies badge data compression and encoding technology to the industry. Currently RightTags wireless readers are used to relay information about booth visitors to exhibitors laptops.

Ahlbergs main hesitation about moving to RFID at this point: the high price of tags—currently between 50 cents and $1 each.

"There are new technologies out there that will drastically reduce the costs that are transitioning from lab to production capabilities," said Ahlberg. "By years end or next year, I can see tags in the 10 to 25 cents range. For us, that would be a dramatic improvement and change the dynamic of how many tags are used in trade show industry," said Ahlberg.

"When Wal-Mart and others issued mandates, the whole consumer products industry marched to the same drummer, and it spawned a whole industry [of RFID vendors]. The problem was there wasnt a whole lot of value, and there was a lot of backlash," said AMR Research analyst Kara Romanow, in Boston. "Now were starting to see a very subtle shift, from tagging everything now to a lot of specific item-level tagging."

This includes tagging items that have a high value or theft risk and tagging at the individual product level, such as a DVD that a store cant afford to run out of during its first two months on the shelf.

Nonetheless, RFID technology is burgeoning. A slew of RFID developers— including IBM and Sybase on the software side and Alien Technology, Symbol Technologies and RightTag on the hardware side—will announce new products this week.

/zimages/4/28571.gifRead more here about Alien Technologys RFID Solutions Center in Ohio.

IBM, for example, will announce upgrades to its WebSphere RFID Premises Server and Device Infrastructure software. The Premises Server will now support smart readers from Symbol, Intermec Technologies and Alien Technology, while Device Infrastructure will support additional readers. Performance enhancements will enable better tag reads and aggregation of reads, according to Ann Breidenbach, director of product line management and strategy with IBMs Sensor and Actuator group.

"Read rates are as much a function of location—what users are putting the tags on—and interference, as much as anything," said Breidenbach, in Armonk, N.Y. "But as we see RFID being deployed in production, versus the dock door, we need to get pretty good read rates. One of the things weve been doing is facilitating that for clients that are going beyond tracking and pallet tagging."

IBM will also announce its RFID Solution for Asset Tracking, which is available through IBM business consulting services and designed to handle both active and passive RFID networks, as well as its Dublin Center of Excellence for RFID, which focuses on asset tracking and logistics.

Separately, Sybase will announce the 2.0 version of its RFID Enterprise middleware suite. This latest iteration brings upgraded device management and network design functionality to a services-based architecture. It also enables users to manage, persist, integrate and analyze RFID data through a development environment that supports business process orchestration and rules development, as well as business activity monitoring.

On the hardware front, many vendors are focusing on Gen 2-enabling their products. Symbol, for example, will announce the availability of Gen 2 code for its RFID handheld readers.

"Really, what this is all about is following through on our commitment to ensure a Gen 2 smooth transition, by allowing users to use what theyve got," said Alan Melling, senior director of RFID business development for Symbol, in Holtsville, N.Y., who said the Gen 2 handheld code is available for download from Symbols Web site. "At the beginning of the year, we had almost no one using [Gen 2]. By the end of the year, everyone will."

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