Jul 08, 2013During the past six or eight months, I have seen a noticeable shift in the radio frequency identification market. Customers are no longer concerned about whether RFID works. They've read about enough successful projects to be convinced that RFID does what it's advertised to do—help track and manage physical assets, tools, people, inventory, and so forth. They are now entering the market to buy and deploy systems. That's a big change from the past decade, when businesses would spend, on average, three years testing RFID before deploying a single reader.
So it might seem to some that the market is finally ready to take off. I think we will see steady growth in RFID deployments during the years ahead, but mass adoption is still years off in some industries. Let me explain why.
For an industry to embrace a new technology in a big way—think bar codes in the 1980s, the Internet in the late 1990s and cell phones in the 2000s—there must be a standard on which everyone agrees. If Walmart had chosen to employ one type of bar code in the 1980s and K-Mart had opted to utilize a different kind, bar codes would not have become ubiquitous. If some companies had embraced Ethernet and others had supported Token Ring and still others Token Bus as the protocol for sharing data over wires, the Internet might never have taken off.
In the world of apparel retail—and maybe all retail—there is a general consensus that passive ultrahigh-frequency (UHF) technology is the best form of RFID for tracking inventory, both in stores and in the supply chain. As a result, retailers can jump on the RFID bandwagon without worrying that the technology they invest in today will be obsolete in three or four years. I think adoption in apparel will accelerate at an increasingly fast rate until we hit the tipping point and the entire industry embraces RFID.
In other sectors, it is a very different story. Take health care, for example. The benefits of using RFID-based real-time location system (RTLS) technology to track expensive hospital equipment are well-documented, yet we haven't seen a mad scramble among hospitals to deploy RTLS solutions. One big reason is that there is no clear standard. Wi-Fi-based active RFID systems are installed throughout many hospitals globally. But there are many hospitals that are using RTLS solutions based on ZigBee, proprietary active RFID or ultrasound technology. Which one will dominate? It's difficult to say at this point, so some hospitals are reluctant to invest.
RFID can help all hospitals reduce costs and improve patient care—if executives come together and draft standards. Ideally, they would agree on one type of active, passive UHF and passive high-frequency (HF) technologies, each for different applications. It also would be useful if they agreed on data standards, so that the serial number on a gurney tag, for example, would indicate that the object was a gurney, regardless of to which hospital it belonged. That way, hospital A could receive a patient from hospital B and read the tags on the equipment entering that facility and know where it came from, as well as what it was. This would enable all hospitals to deploy RFID and be able to identify not only their own assets, but also those from other hospitals and health-care equipment rental companies.
In addition, other industries could benefit from standards for the use of RFID. You might think it unlikely that competitors would come together to agree on how to use RFID, but it has already happened in a number of industries. The retail-consumer products goods sector created a subgroup under the aegis of GS1 to draft standards indicating not just what a tagged object is, but where it was read and the business process involved, such as shipping, receiving, merchandising and so forth. Similarly, the aerospace sector came together under the Air Transport Association to create RFID standards under Spec 2000, a comprehensive set of e-business specifications, products and services designed to overcome challenges that have plagued the industry's supply chain for decades (see ATA Approves RFID Data Structures for Spec 2000).
A gentleman from the oil and gas sector reached out to me at RFID Journal LIVE! 2013, seeking my help in bringing his industry together to create standards. I will do what I can, but industry leaders need to step up and understand that while the value of RFID used internally is significant, the value of employing it among business partners is much greater—because, as we all know, assets, tools, equipment, containers, parts, inventory and products don't remain just within your own four walls.
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.