Can you please explain how these devices function?
There are many different types of RFID systems. Readers (interrogators) have different ways of communicating with tags (or, more accurately, with transponders). Generally speaking, readers send out a signal and ask tags to respond. Since an interrogator can only communicate with one tag at a time, it needs to go through an algorithm to identify one tag at a time. This is like a teacher asking all new students to stand if their last name begins with the letter A. If five students stand, the teacher then asks the students to remain standing if the second letter of their last name is also A, and so on until only one student is standing. There are different algorithms for different systems.
Passive tags use energy from the reader to respond. The coiled antenna of a passive low-frequency (LF) or high-frequency (HF) tag forms an electromagnetic field with the coiled antenna of the passive LF or HF reader. Changes in this field are interpreted by the reader as a one or a zero, enabling the tag to send binary code to the device. Passive ultrahigh-frequency (UHF) tags use backscatter to send a signal over a longer distance.
Active tags have a power source and broadcast a signal to the reader, which simply has to pick up the waves being emitted and interpret them based on a defined air interface protocol. This protocol is the "language" that tags and readers use to communicate. If there are two passive HF or active tags that employ different protocols from a single reader, then the reader will only be able to communicate with the one that utilizes the same protocol that it uses.
—Mark Roberti, Founder and Editor, RFID Journal
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