RFID Technologies

This Explorer technology area has been discontinued.

Technology Analyst: Guy Garrud

Announcement

The December 2017/January 2018 Viewpoints was the last for Explorer's RFID Technologies technology area. In creating the new Internet of Things Explorer technology area, the RFID Technologies area became redundant, being much better considered within the context of the Internet of Things.

Therefore, Explorer's coverage of this technology will continue within Internet of Things, as well as within other Explorer technology areas, including those focusing on sensors, connectivity, and electronics. Clients of RFID Technologies will automatically have access to Explorer's Internet of Things, and will also continue to have access to the RFID Technologies site in order to review previous publications, including the Technology Map.

Viewpoints

Archived Viewpoints

About This Technology

April 2017

Radio-frequency-identification technology is an automated data-capture technology that uses low-power radio waves to communicate between readers and tags or contactless cards. Tags can attach to items such as components, products, packaging, or bulk batches of products to provide access to additional information for, for example, manufacturing, supply-chain, and asset-tracking applications. Contactless cards find use in passports, smart cards, and badges for authorization, identification, and payment applications. The technology promises to create and share information about the movement and status of objects accurately and reliably. RFID technology, in contrast to bar-code technology, requires neither line of sight nor alignment between reader and tags. Moreover, RFID tags are sturdier than bar codes, enabling their use in adverse manufacturing conditions (such as hot or dirty environments). A major driver of the technology is the need for real-time internet-enabled information access. Though RFID has been available for quite some time, the technology is still far from ubiquitous, and its initial promise to be a prime enabler of the Internet of Things is far from fulfilled.

Early use of RFID has demonstrated benefits for supply-chain management and logistics, and RFID has seen wide use in contactless cards and near-field-communication features in smartphones. Government installation of RFID readers in customs and security systems and the distribution of RFID-enabled contactless passports continue to be important RFID deployments; a growing number of companies are using RFID to manage their inventories, supply chains, and equipment; and RFID is in use to identify individuals in workplaces, resorts, schools, and amusement parks. However, RFID technology faces a number of technical and institutional challenges. The technology's accuracy and reliability need to improve. Existing infrastructures are still limited—with an insufficient number of readers and middleware connecting RFID-captured data to other software modules—in contrast to infrastructures for bar-code technology. Implementation of an infrastructure that enables seamless use of the technology across all supply-chain partners is expensive because of the need for new hardware and software and additional costs for middleware and systems integration. Costs of individual tags, which manufacturers will produce in the billions if the RFID market lives up to its promise, are still too high for ubiquitous tagging of individual items in most commercial-product categories. In addition, other forms of tags—from QR codes to acoustic bar codes to biodegradable RFID tags—offer competition to conventional RFID technology.

According to a 2016 market report by IDTechEx, the RFID market will reach some $13 billion by 2020. Nonetheless, although the idea of using tags to bind digital information to objects is now well accepted by industries and the public, we are clearly moving away from the dream of having an Internet of Things with transparent self-reporting objects whose identities are globally stable and centrally managed to a more decentralized and episodic Internet in Things. Nearly a decade after the first commercial and government mandates, RFID technology has demonstrated its value as a market enabler for manufacturing, supply-chain, and logistics operations; tracking; and security and identification applications. Adoption of RFID technology in manufacturing, supply-chain management, identification applications, and new types of payment systems for mobile commerce is only the first step. Once a sufficient infrastructure is in place—be it an IoT or some other incarnation of that idea—a wide variety of other commercial opportunities will emerge, much as products and services proliferated in the internet arena. New products and services will emerge that use the RFID infrastructure as a base. Among the applications with potential for market success are products that combine RFID technology with sensors and RFID-enabled end-consumer products and services. Entrepreneurs are likely to discover many other potential RFID (and RFID-inspired technology) applications as an IoT or similar system grows. Market optimists (and industry hype) envision a gold-rush mentality similar to the one that occurred during the dot-com period. In reality, developers, users, and investors need to take a realistic look at remaining RFID-technology-related issues not only to avoid making strategic business mistakes but also to identify genuine opportunities in a wide range of applications.