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The (RFID) World According to Moore

Based on the technology life cycle described in Geoffrey Moore's bestseller Inside the Tornado, RFID is nearing widespread adoption in some industries.
By Mark Roberti
Apr 01, 2010—In his bestseller Inside the Tornado, Geoffrey Moore explains that new information technologies pass through several distinct stages before they enjoy widespread adoption. In the first stage, which he calls the Early Market, "technology enthusiasts" who hear that a new technology can deliver a clear and compelling benefit over existing technologies work with vendors (usually startups) to develop solutions that fit their needs. Visionaries take these basic solutions and adopt them to try to gain a competitive edge.

In the second stage, called the Chasm, vendors offer these solutions to other end users, but the technology meets with resistance because the solution isn't complete enough to satisfy all their needs. Moore says there's a chasm between the visionaries and "pragmatists"—those who will invest in a technology only when everyone else invests in it.

Chart: John hull (adapted from Inside the Tornado)

In the third stage, technology companies build a "whole product" that meets the needs of a market segment. Pragmatists in that niche who have specific business problems that the technology can solve begin adopting it. At this point, the technology has crossed the chasm and is now in what Moore calls the Bowling Alley. Technology providers try to achieve widespread adoption in that niche, so they can knock over a bowling pin (one market segment). When they've knocked over one pin, they try to adapt their product and sell it to another segment and then another.

In the fourth stage, one vendor emerges as the market leader. With a clear choice, pragmatists move as a herd to adopt the solution. Companies that previously didn't need the technology now must have it—and the technology enters a period of rapid growth. Moore calls this the Tornado.

So based on Moore's model, which has proved correct for many technologies, which stage of the RFID adoption life cycle have various industries reached? Most are in stage three, where vendors are building a whole product and pragmatists are starting to adopt it to solve business problems. The number of companies in specific segments will continue to increase, and vendors will continue to develop products that are more complete. Many early adopters report that they are gaining a competitive advantage over companies sitting on the RFID sidelines.

For pragmatists to adopt the technology en masse, there must be agreement on a technology standard, a whole product that meets the industry's needs and a market leader. Different industries are closer to widespread adoption than others.
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