RFID Adoption Accelerates

By Mark Roberti

It's just a matter of time before it reaches the tipping point.

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There was a period in the mid-2000s when every year was declared "The Year of RFID." It never happened. Mandates requiring suppliers to tag pallets and cases were met at only a minimal level. The suppliers that did tag shipments didn't use the tags for any internal benefits—not even to confirm the accuracy of their shipments. In many cases, they didn't read the tags to confirm they worked and were properly encoded.

It's hardly a surprise that RFID didn't take off when few companies were benefiting from the technology. RFID began to gain some traction in 2008, but when the financial crisis hit in September of that year, many companies hunkered down and cut IT projects, RFID deployments among them.

Still, a funny thing happened. Even though RFID providers struggled during the downturn, they remained convinced that the technology would deliver huge benefits and would eventually take off. They continued to develop their products and work with a handful of end-user companies that believed RFID could solve some serious problems they were facing and was worth the effort and investment.

That stick-to-itiveness paid off. Today, there is a tag for almost every application and thing you want to track and manage. Passive ultrahigh-frequency readers range from devices that can be installed in a ceiling to provide real-time location information on tagged items to devices so small they can be embedded in a key chain. And software has evolved to address specific needs. These advances reduce risk for companies now seeking to adopt RFID. What's more, companies that have been using RFID are developing smarter strategies for engaging supply-chain partners (see Perspective).

Costs have not yet come down dramatically, but the reduced risk and availability of mature technology solutions is helping to propel adoption. This will lead to more large-scale deployments, which will reduce the cost of hardware and software—and that, in turn, will encourage more companies to adopt.

As our cover story in this issue reveals, this is already beginning to happen. Perceptions of RFID are changing, from overwhelmingly negative to largely positive.

Retailers, health-care providers and manufacturers, in particular, are having success. The mainstream business press is now covering the technology more objectively, causing more companies to take notice. (Firms that aren't deploying RFID are growing concerned about being at a competitive disadvantage.)

The liquor industry is an example of how mature technology is fostering adoption. The high value—and frequent counterfeiting—of wines and spirits has led some RFID providers to develop tags that work with the liquid and packaging of these items. As our Vertical Focus reveals, liquor manufacturers are beginning to embrace RFID as a way to authenticate their products, track their inventory and engage customers.

RFID is not going to become ubiquitous overnight. But adoption is accelerating, and it's just a matter of time before it reaches the tipping point.

Mark Roberti is the founder and editor of RFID Journal. If you would like to comment on this article, click on the link below. To read more of Mark's opinions, visit the RFID Journal Blog, the Editor's Note archive or RFID Connect.