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RSI Announces Sub 15-cent Gen2 Tags

RSI ID Technologies yesterday announced the availability of Gen2 labels at a price of just under 15 cents in quantities of one million or more. The labels are fully converted, tested, and ready to use.
Sep 23, 2005This article was originally published by RFID Update.

September 23, 2005—RSI ID Technologies of Chula Vista, California, yesterday announced the availability of Gen2 labels at a price of just under 15 cents in quantities of one million or more. The labels are fully converted, tested, and ready to use. RFID Update spoke with RSI's Vice President of Marketing Tawnya Clark about the offering.

Clark said that the aggressive pricing is an initiative by the company to encourage end-users to start using Gen2 technology. "Gen2 is where the industry is going, and our goal is to drive end-user adoption." Part of the reason the 14-year old company is able to offer the tags at such prices is that they manufacture their own inlays. "We wanted to bring [the whole tag manufacturing process] in-house to pass that savings on to the customer. That's why we are able to be as competitive as we are on the pricing." (Note that this eliminates the possibility that RSI's announcement is tied to that of Avery's 7.9-cent inlays, as some have speculated. The two announcements are unrelated and their timing coincidental.)

Some analysts thought that the low price point suggested that RSI must have cut corners somehow and that the labels are lacking in features or quality. RFID Update pressed Clark on these points, but she was firm that no factor is compromised. The labels come in standard roll format and can be manufactured to function with whichever brand and model of printer/encoder the end-user has. They have permanent emulsion acrylic adhesive and can be either 4x2 or 4x6 in size (same pricing). The tag quality assurance testing is a particular strength of the company, according to Clark. "We have designed and implemented testing standards that have been adopted around the industry." She noted that when RSI sends an order of, say, 500 working tags, they do not send 700 with 200 crossed out. "If we are sending you 500, all 500 are good," she said.

In addition to the sub-15 cent pricing, RSI also announced a "roadmap" program that will allow end-users to achieve sub-10 cent pricing by December 2006. Clients must make high-volume commitments with specified delivery dates. Tag quantities in the 5 million range -- roughly a million per quarter between now and then -- is a rough approximation of the volume required to get that pricing. Actual quantities and prices will be negotiated on a per-client basis.

As further incentive to end-user companies, RSI is offering a Gen2 compliance package free to any company that purchases 100,000 tags or more. The package includes an RFID printer/encoder (probably from Zebra, but Printronix can also be an option), software, and an antenna/reader combination.

RSI's announcement caps a week of excitement around falling tag prices trigged by the Avery Dennison announcement of 7.9-cent inlays. That announcement, while bold, did not address exactly what a completed tag would cost to the end-user (something RFID Update answered in yesterday's article). The fact that RSI has explicitly named a final tag cost is therefore significant not only because the pricing itself is so aggressive, but also because it speaks directly to the end-user and not the label converter middle man who would be the purchaser of Avery inlays. RSI's Clark said that they want end-users to see the announced tag prices and say, "That is a finished product, and that is what matters to me."

Read the RSI Press Release
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