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Response to Waning RFID Hype

Based on the many responses from RFID Update readers, most agree that the enthusiasm and hype around RFID has subsided somewhat. But, significantly, there is a feeling that perhaps that's for the best.
May 12, 2005This article was originally published by RFID Update.

May 12, 2005—Yesterday's article about the recently sobering tone across the RFID industry elicited an unprecedented response from readers, many of whom offered additional theories for what is going on. Jack Brandon, Senior Business Manager at Socket Communications, compares RFID's uptake to that of the bar code, which he points out is still not complete. "Estimates are that almost 20% of retailers and 35% of manufacturers still don't use bar codes," he writes. Brandon also notes that not all technology markets move at the same pace. "Most of us old-timers in the computer/electronics industry are all too familiar with Gartner's 'Hype Cycle' - the 'Valley of Disillusionment' for the PC lasted almost 7 years! Tell all the newbies expecting instant gratification (i.e. ROI) to hang in there. The Auto ID industry moves a lot slower than the computer or wireless markets - [Auto ID] products are typically expensive, 'mission critical' and expected to last 7 to 12 years."

Others felt that the issue of ROI is problematic. To be sure, ROI is a crucial component of any business decision, but in many cases it is impossible to quantify. Vice President of Sales and Marketing at Rush Tracking Systems Chas Mullins writes, "This enterprise solution, RFID, is not an application that can be measured with an ROI tool, but rather an architecture or infrastructure, much like the Internet." He continues, "If you ask someone what is the ROI for the Internet, they wouldn't know how to measure it. But at the same time, they can't imagine not having that infrastructure to do their business-to-business transactions."

Many responses concurred with the point that RFID is burdened by the weight of its own hype. Aside from the predictable problem of inevitable disappointment in the face of glorious prognostications about RFID's transformative potential (Gartner's aforementioned "disillusionment" period), hype attracts less-than-qualified opportunists that exaggerate their capabilities in the hopes of cashing in quickly on what they perceive to be a high-growth market. "Some companies," says Carl Brown of SimplyRFID, "say they are in RFID but have never done an install or don't even have any RFID people on-staff." This creates an unfortunate environment of vaporware, in which a market appears to be crowded with providers when in fact not much worthy product or expertise is readily available.

Finally, many respondents feel that the RFID industry is still not proactively and intelligently dealing with the privacy issue. It is no wonder that the technology is not being adopted faster when it suffers from a public perception problem. Scott Schubbe, Research and Development Manager for Label Works, writes, "The people leading the privacy charge, however you want to label them, have struck a cord, and the [RFID] industry has done little to assure the average person that the technology or the industries behind the technology have the consumer in mind when designing their systems." Others observed that RFID touches a particularly sensitive nerve in a security-obsessed, post-911 world in which issues of privacy and decreasing citizen protections are at the forefront of many people's minds.

Based on the many responses from RFID Update readers, most agree that the enthusiasm and hype around RFID has subsided somewhat. But, significantly, there is a feeling that perhaps it's for the best.

Yesterday's article "Doubt from Across the Industry"
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