Middle East RFID Market Heats Up

The pilot, spearheaded by Qatar's General Postal Corp. (Q-Post) and also including Saudi Post and Emirates Post, leveraged both passive EPC Gen 2 tags and active tags placed on approximately 3,120 test letters that circulated among the three nations (see U.N.'s Universal Postal Union Gears Up for Large RFID Pilot). The UPU is now gearing up for a large-scale pilot, set to commence in April 2009, that will involve the deployment of RFID systems in Dubai, UAE and Saudi Arabia, as well as in all other participating countries (a total of 20 initially, with 30 more joining in 2010), and the development of requisite data and analysis programs.

Several Middle Eastern countries also have aggressive plans for using RFID-enabled identification cards and passports. The Kingdom of Bahrain, for instance, recently ordered an additional 1 million electronic ID cards from Dutch digital security firm Gemalto. The order extends the country's original electronic ID system that got underway in 2007, which leverages RFID-enabled electronic ID cards that serve as the official ID for Bahrain citizens, as well as for foreign residents. Bahrain is not the only government in the region employing RFID-enabled ID cards; the Gulf Cooperation Council (GCC), of which Bahrain is a member, is championing the use of the RFID-enabled ID cards and passports. The GCC is a trade bloc involving the six Arab states of the Persian Gulf (Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the UAE).

Louis Bianchin, a senior analyst with VDC Research's auto-ID and transaction-automation practice, agrees that RFID's use is growing in the Middle East, but adds that challenges still remain. "It is encouraging to see the uptake, but it is not quite there yet, and we wish the market could do better," Bianchin states. "There aren't as many [RFID] distributors in the region. While there are some local distributors, the knowledge of these distributors is limited."

RFID vendors have spent most of their efforts in the United States and Europe, then moved on to Asia, and then to Latin America, according to Michael Liard, practice director of RFID for ABI Research, a market research firm located in Oyster Bay, N.Y. More recently, he says, vendors have been eyeing the Middle East.

"But it takes time to foster channels, and to do market outreach," Liard says. "There are go-to-market strategy challenges, and there aren't that many qualified systems integrators and resellers in that region who can really promote the value and business of RFID." Language and cultural differences are also challenges that can take time to work through, he adds.

This year, RFID Journal will host its first RFID technology conference and exhibition in the region—RFID Journal LIVE! Middle East. Conference sessions will cover how radio frequency identification can improve operations in construction, logistics, oil and gas, health care and other industries. The event will be held on June 15-17 at the InterContinental Hotel Festival City in Dubai.