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DVD Movies to Star in Retail RFID Pilot

Major movie studios, distributors, and retailers will conduct an eight-week pilot project to track individual DVDs with Gen2 RFID tags. The pilot was designed as a proof of concept for item-level supply chain tracking and will involve reading tags at manufacturing and at retail to assist inventory management.
Sep 27, 2007This article was originally published by RFID Update.

September 27, 2007—Coming this fall to your home screen: DVD movies with RFID tags on the packaging. Movie studios, distributors, DVD replicators, and retailers are piloting item-level Gen2 RFID tagging on DVD movies as a proof of concept for supply chain and retail inventory management operations. The EPCglobal-sponsored pilot announced this week has Hollywood and retail star power: 20th Century Fox, Cinram, Sony Pictures Home Entertainment, Technicolor, Warner Home Video, Mosaic Entertainment, Handleman, Best Buy, and Wal-Mart are among the participants, which also includes other undisclosed retailers and studios.

"The pilot is to demonstrate how EPC tags would work on DVDs from manufacture full through to retail," Rob Thibault, director of external affairs for EPCglobal North America, told RFID Update. "All of the participants can get real-time information on where any product is at any time."

Plans call for more than 12,000 individual DVDs to be tagged during the eight-week pilot that is scheduled to conclude in November. Fifteen titles will be tracked, but they have not been finalized and may change during the course of the trial, according to Thibault. Replicators, which manufacture the DVDs, will apply Gen2 smart labels to the shrinkwrap around each case. The tags will be read when DVDs leave the replicator, arrive at retail facilities, and when they are stocked on shelves. Pilot partners will use the EPCIS standard to exchange product data.

Technology companies who have announced their participation are: ADT Sensormatic, Avery Dennison, Checkpoint Systems, Impinj, Motorola, Nashua, NXP Semiconductors, OATSystems, Omron RFID, Printronix, SATO America, T3Ci, TrueDemand Software, UPM Raflatac, VUE Technology, and Zebra Technologies.

Best Buy and Wal-Mart stores in the Minneapolis/St. Paul and Oklahoma City areas will take part in the trial, and Thibault said other retailers will also participate but will not announce their involvement. RFID-tagged DVDs should be readily identifiable by consumers because the smart label containing the EPC RFID inlay will also include a printed logo and notification that the product contains an RFID tag.

EPCglobal's press release puts considerable emphasis on allaying potential consumer privacy concerns. The press release states an EPC label "... can only transmit its unique number when it is less than about 10 feet from a reader that activates the label... The actual distance from which an EPC label can be read may be shorter because barriers such as shopping bags and other factors such as the presence of metal materials or nearness of walls or other obstructions weaken a reader's signal."

The statement about 10-foot range is interesting for several reasons. First, because EPCglobal and RFID vendors rarely publish specific RFID range figures, in part because range varies significantly based on environmental and other factors. Second, when discussing range product manufacturers routinely claim 20- and 30-foot read ranges for their Gen2 products, and the standard was developed specifically to support supply chain processes that require more than 10-foot range. Long range is not usually a requirement for retail shelf monitoring applications featuring handheld readers (which generally use less power and thus have shorter range than fixed-position models), yet the statement hints at potential reading difficulties in retail environments.

Analysts and vendors have frequently touted DVDs as having high value potential for item-level tagging. The trial will test common assumptions but may be most significant for its size and participants. Best Buy has already conducted its own DVD tracking pilot earlier this year, which Best Buy International CEO Robert Willett credited with an 18.7 percent revenue increase at the pilot store (see investment firm Baird's coverage).

NXP, another pilot participant, previously announced an RFID security solution that can disable DVDs from the time they are produced until they are purchased through legitimate channels (see NXP and Kestrel Partner on RFID Antitheft for DVDs). The system was developed to deter shoplifting and diversion. The EPCglobal project is not piloting any security applications, according to Thibault.

"Consumers won't necessarily see all these benefits during the pilot test, but that the future of EPC holds tremendous promise," EPCglobal President Chris Adcock is quoted in the pilot announcement. "We've all had the frustrating experience of a store associate telling us that a DVD is in stock, but they can't find it on the shelves. EPC can help eliminate that problem."
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