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The RFID Market's Holiday Wish List

In this guest article from AMR Research, analyst Dennis Gaughan shares a holiday wish list for RFID in 2006. He offers four key elements that would make next year a successful one for the technology.

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Dec 22, 2005—This article was originally published by RFID Update.

December 22, 2005—As we close out another busy year, thoughts turn to gift giving as well as giving thanks for the people in our lives. This is also the time of year when children are on their best behavior, hoping that their efforts have been rewarded with an Xbox 360 or an iPod Nano. For the RFID community, 2005 has been a year of incredible activity with continued expansion of pilot deployments and maturation of the technology. As we look forward to 2006, AMR Research expects the level of activity to be even higher. Overall, the RFID market still has a ways to go before it becomes mainstream, and challenges persist in identifying new opportunities for getting value through the use of RFID.

Just like all the children and their wish lists, I have taken the liberty of creating a wish list for the RFID market for 2006. It's an abbreviated list of four key developments that, if happen successfully and on time, will help significantly push the market forward:

ISO Blessing for Gen2. A critical milestone for the development of UHF passive RFID. One of the major concerns from early adopters has been the fear that separate tag and reader infrastructures by geography would make ROI impossible to attain. This would alleviate those fears as well as put a true global stamp on the market.
New Industries. The lion's share of the activity, hype, and angst related to RFID has been narrowly confined between retailers and consumer goods companies. Seeing successful migration of the technology to industries like pharmaceuticals, A&D, automotive, and chemical (among others) will help lower costs and identify new, innovative ways to leverage the technology.
Frequency Agreement. Another key milestone for global uptake will be decisions around frequency allocations in geographies around the globe (like China).
Continued Pragmatism. Our recent research has identified a shift in focus toward more pragmatic, targeted uses of RFID technology that have a much clearer mutual benefit for supply chain partners. This must continue.

Of course, there are many other milestones that will help drive the industry forward, and it will take continued collaboration between vendors and customers to make it happen. But if these four milestones get achieved, 2006 will be a successful year for RFID. I hope that everyone reading has a safe and happy holidays and good luck in 2006.