Jun 11, 2002June 11, 2002 -- The Auto-ID Center continues to add to the impressive lineup of vendors backing its standards efforts. Intermec Technologies of Everett, Wash., and STMicroelectronics N.V. (NYSE: STM) of Geneva, Switzerland, join the likes of Intel, Philips Semiconductor and Tagsys as sponsors.
STMicroelectronics is a global semi-conductor company, which had more than $6 billion in sales last year, mainly in the Europe and Asia. It makes integrated circuits for cell phones, consumer products, automotive and industrial applications, smart cards and RFID tags.
Intermec Technologies is division of UNOVA Inc., a $2.1 billion industrial technologies company. The unit was formed when UNOVA consolidated three businesses: Intermec, Norand, and United Barcode Industries. Intermec still makes bar code equipment, but it also develops, manufactures and integrates wired and wireless automated data collection, including its Intellitag line of RFID tags and readers.
Getting more and more of the world's major semiconductor and RFID tag makers to back its electronic product code and standards for reading low cost tag is significant achievement for the Auto-ID Center.
But some insiders grumble that vendors are joining the Auto-ID Center because doing so gives them access to big companies, including Wal-Mart, Coca-Cola, Pepsi, Home Depot, and others that are interested in adopting RFID technology.
Vendors, to a certain extent, have viewed the Auto-ID Center warily. The center wants to drive the price of chips down to 5 cents and ultimately a penny. And they want to push reader prices down to about $100.
Vendors that have invested millions in equipment and in developing products want to maximize their margins, not see their products turned into commodities.
STMicroelectronics spokesperson Mike Markowitz acknowledges the conflicting goals on price, but says his company shares the Auto-ID Center's main goal of driving widespread adoption of RFID technology.
"Obviously, we would like to get the highest price possible for our chips," Markowitz says. "At the same time, we recognize that the proprietary approach is not necessarily one that will expand the marketplace, and we see expanding the marketplace as being the key to the adoption of RFID."
Markowitz added that his company is behind the center's drive to create global standards for RFID because standards are needed to spur adoption. He also said the company is pleased that the Auto-ID Center is doing research to explain the business case for adopting RFID. "The models now are not particularly well-defined, so companies are having difficulty demonstrating cost advantages of RFID," he says.
