Magazine Article | February 1, 2002

A Whirlwind Of Change Defines Handheld Bar Code Scanners

Source: Field Technologies Magazine

Whether it's the escalation of CCD (charge coupled device) technology, non-traditional applications, or shrinking costs, handheld scanners aren't what they used to be.

Integrated Solutions, February 2002

Is there anything revolutionary happening in the handheld bar code scanner market? Revolutionary? No. Nevertheless, there is change occurring, but you probably already know that. After all, do you own or have you ever used a digital camera? If so, then you have used the technology that's offered the biggest change recently in the handheld scanner market - CCD (charge coupled device) technology.

For the uninitiated, here's a quick review of CCD technology as provided by the industry association, AIM (Automatic Identification Manufacturers) ( "CCD scanners use a stationary flood of light (usually light emitting diodes [LEDs]) to reflect the bar code symbol image back to an array of photosensors. Depth of field (DOF) - the optimal distance for the scanner to read the bar code - ranges from contact to 6 inches, though greater DOF has been achieved. Because CCD scanners contain no moving parts, they tend to be more rugged than laser scanners. CCD-based handheld image readers are also capable of reading 2-D matrix bar codes as well as stacked and 1-D codes."

Technology Evolution Brings Lower CCD Costs
So what's the big deal? CCD scanners have been around for years. However, as with any evolving technology, design and manufacturing costs have come down over the past few years as demand has risen. "The digital camera industry and a general reduction in the costs of high performance processing power have driven down CCD technology costs," said Phillip Shepard, senior product manager, automated data collection for PSC Inc. (Portland, OR). "This cost reduction, coupled with the economies of offshore manufacturing, have resulted in linear CCD-based scanners that rival laser scanners in all performance areas, except long depth of field."

Dick Sorenson, director of product management for LXE (Norcross, GA), concurs with Shepard's analysis. "Since CCD technology is fundamentally silicon-based (versus laser/mechanical for laser scanners), it follows the natural progression of silicon technology development: lower cost and higher performance." As an example, Sorenson noted that some CCD scanners used in linear bar code applications have "hit the competitive 'sweet spot'" of a 15-inch to 18-inch DOF in a variety of lighting conditions.

More Competition
When Shepard mentioned the impact of offshore manufacturing, he touched upon another change the handheld scanner market has undergone - namely, an increase in competition. "More handheld scanner providers are definitely entering the marketplace, especially with CCDs from Asia," he said. "This trend will continue as key handheld and laser patents expire over the next few years."

One overseas vendor that isn't new to the scanner market is Unitech Electronics Company (Taipei, Taiwan). Larry Ru, product manager for Unitech America, Inc., stated, "Competition has increased substantially in the past three years. Vendors from foreign countries are really dropping prices to enter the market. Furthermore, other leading vendors that originally only provided laser scanners are now jumping into the CCD market."

David Krebs, an analyst specializing in the AIDC (automatic identification and data collection) industry for research firm Venture Development Corp. (VDC) (Natick, MA), said he noticed a lot of CCD startups from areas such as Taiwan and Korea at the 2001 Comdex show. "The CCD and CMOS (complementary metal oxide semiconductor) sides of this business are definitely seeing new players enter the market," he said.

Applications For Handheld Scanners
Yet, despite an increase in competition and falling prices, there have to be applications suited for these products. Of course, POS (point of sale) solutions are always the first that come to mind. But, the healthcare, warehousing, security, logistics, and field service markets are also increasing their use of CCD scanners. The ability of these products to not only capture 2-D bar code information, but also act as a digital imager (e.g. camera), has made them a staple of many industries' supply chains.

And, according to Maurice Waters, United States manager of Syntech West (Gig Harbor, WA), if a market isn't a traditional user of CCD technology, it may soon become one. "There is a lot of movement in the traditional laser scanner markets (e.g. POS) to CCD technology," he explained. "Many companies that are now at the beginning of the re-buying cycle for scanners are considering CCD. So, what is a new market for some vendors is an old market for others."

CCD Thrives In Security Environments
The security market is one market expanding the use of AIDC products since the events of September 11, 2001. In particular, the airline industry is - and has been - using scanners for baggage handling and passenger processing. "Now, scanners are being used to validate and match baggage with boarded passengers, route baggage with connecting flights, and verify baggage screened in security checks," Sorenson said. Much of this activity now integrates traditional bar code scanning with RFID (radio frequency identification)-based systems. As a result, applications for handheld devices with combined laser scanning and RFID capabilities are growing."

But, the concept of security crosses all markets. In fact, it's really an issue of validation companies are seeking when using CCD scanners. They want proof, whether in the form of data from a bar code or via an actual picture of an object. For example, using a CCD scanner you can actually capture a photo of a delivery signature or the contents of a truck. In the latter case, a shipping company can use this information to track losses or inefficient packing procedures.

Becoming A Commodity
According to a recent VDC report, "The handheld market is increasingly emulating that of a commodity technology." If by that they mean handheld scanners are moving toward being an off-the-shelf product sold in chain stores, then Waters agrees. "There is a trend for that sort of selling and focus," he elaborated. "However, large chains want to make profits on sales. But, with the current market, there is not enough profit involved to make it viable for them. Where once vendors could rely on a minimum of 50% profit, now they are achieving 10% to 20% at the most."

Ru also agrees with the VDC finding, listing open architecture and PDA (personal digital assistant) products as contributing factors to this trend. However, he and Waters both caution that no matter what the distribution avenue, handheld scanners are still not entirely plug-and-play devices. They list system integration with supply chain processes as the reason for this sentiment.

All in all, maybe the handheld scanner market is seeing some revolutionary changes. At least in terms of the price of CCD scanners this may be true. Or, maybe it's the new applications CCD technology affords. Whatever the case, the results have been - and seem to continue to be - positive for end users of these devices.