Who's Afraid Of RFID?

There's no denying it. RFID (radio frequency identification) has not yet become a widely adopted data collection technology. It still wrestles with interoperability issues stemming from a preponderance of proprietary systems and a general inconsistency in assigning standard frequencies. Consequently, RFID continues to be perceived as a technology suited only for a few niche applications. Of course, some customers can easily justify implementing a proprietary RFID-based data collection system. For high-value asset tracking and antitheft protection, for instance, RFID is justified by the need for higher security. Interoperability is a nonissue in some national rollouts by large corporations. For instance, the Mobil Speedpass automated payment system from Texas Instruments has successfully brought m-commerce convenience to millions of Exxon Mobil's customers. But is RFID ready for the masses?

While many applications are still in the early adopter phase, the sheer increase in available RFID applications suggests RFID is poised to move beyond its early handful of niches. It is already being used in applications such as livestock control, baggage tracking, postal tracking, highway toll processing, hazardous materials management, and access control. Furthermore, RFID manufacturers and standards groups are working toward consensus on standard frequencies and the need for open systems designs. As a result, today's adopters should find plenty of companies tagging along (pun intended).

RFID Gets App Happy
RFID technology can bring automatic data collection and tracking capabilities to environments in which bar code labels would be difficult if not impossible to use. After all, RFID tags are durable and can be manufactured in unusual shapes. For example, tags can be manufactured in the shape of a screw and then inserted into wooden items, including trees. John Streppone, VP of the mobile products division for Psion Teklogix (Mississauga, Ontario), notes that for disease control, specially designed low-frequency tags can be used to record the medical history of livestock. "Following wide, sometimes government-mandated use in Europe, Canadians, in particular, are getting more aggressive about animal tagging. They're putting tags in tiny capsules that are injected under the skin of animals," Streppone explained.

Tags can also be concealed in automobile tires to record manufacturing information (including production date) in order to increase consumer safety. "We work with a company that has tags that can survive the curing process for tire manufacturing," Streppone said. He also notes that technological advancements have made it possible to put RFID tags on metal barrels. "That was once a problem because of the feedback between the barrel and the tag. But we're over that hurdle now," said Streppone. Tagging barrels is particularly useful in applications requiring the housing and transportation of hazardous materials.

Costs Down, Time To Power Up
With the price per tag already under a dollar for most applications and continuing to drop, RFID should attract users in retail, as well as in manufacturing. Of course, for years, retail stores have been installing security systems using basic 1-bit RFID tags to guard against theft of items. However, RFID tags with increased data capacity have only recently been explored for inventory management. According to Bill Allen, e-marketing manager for Texas Instruments RFID Systems Division (Plano, TX), one customer is reporting a 5% revenue increase from a pilot program in which an RFID tag is embedded in the retail tag for each item. The system helps the retailer to track items from the distribution center (DC), through the store's back room, to the shelves, and, ultimately, out the door. The RFID system informs the staff when shelves are low on particular items. "Retailers hate to see a customer leave because the product wasn't there," Allen said. "Their worst nightmare is finding out that the product was in the back room but just wasn't moved to the store shelf." While bar code labels and scanners could have been used to monitor stock levels, the RFID system enables staff to take inventory on entire sections of the store or back room in a few minutes. "The elimination of line-of-sight needs and the ability to simultaneously read multiple tags greatly speeded the process of determining whether any shelves needed to be replenished with items in the back room," Allen said.

The use of RFID to speed inventory monitoring in retail is merely a variation on its use for basic supply chain and warehouse operations. According to Allen, advances in UHF (ultra high frequency) technology should make RFID-enabled supply chain management accessible to more customers. "UHF can outdo low frequency technology by offering improved read range with less power and a smaller antenna system. That lowers costs for the reader, the tags, and the antenna system," Allen said. "Plus, the larger read range is ideal for reading multiple items passing through large doors, such as 50-carton pallets carried by a forklift through the exit of a warehouse."

Trust The Big-Name Pioneers
Streppone encourages potential customers to consider the value of being regarded as an industry leader in using innovative technology. "In many applications, you could be a cutting-edge adopter," Streppone said. Nonetheless, Streppone acknowledges the need for caution. "The challenge for customers in the early adopter phase is that there aren't many users out there who can provide vendor references. There aren't many sites where the application is up and running," Streppone said. "That's why we always recommend running a small pilot program to make sure the application actually fits your business needs."

While vendor references may not be as widely available as they would be for other technologies, the use of RFID technology by high-profile clients should help to confirm its reliability. Allen points to the baggage tracking application at London's Heathrow Airport as an example of RFID's stability. "Three years into the operation, the system is still hitting a 99% accurate read level. With a typical bar code-based baggage tracking system, users are happy if they can get at least 60% accuracy in reading the labels." Allen also notes successful RFID rollouts for McDonald's, Exxon Mobil, and Nokia. "These are major players in the m-commerce arena. Obviously, they have recognized that RFID is a proven technology. That should inspire other potential customers," Allen said.