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5 reasons why now is the time to adopt RFID

Category : RFID · by Jun 27th, 2013

Adoption of technology often follows a familiar pattern:

  • Clever people in academic institutions discover, invent and then publish details of technological breakthroughs.
  • Commercial innovators and their financial backers recognise the potential of these breakthroughs and invest in their commercial application.
  • Media interest in the technology increases and word spreads about its potential.
  • A bubble of commercial hype grows around that technology leading to unrealistic expectations.
  • As projects and companies fail to meet those expectations, the bubble bursts, projects are abandoned and companies fold.
  • The practicability of the technology is discredited and interest wanes.
  • A core of practical commercial application often in specialised fields is left from which the technology slowly matures.
  • Eventually that technology matures to the state where it can realise those early commercial hopes and mass adoption of the technology and its exponential growth begin.

Internet commerce and mobile technology illustrate this – think of the dotcom bubble of the late 90s or the Apple Newton PDA. As with these technologies so RFID has been through its own cycle and has now stepped over the last hurdle to the point of where mass adoptions and exponential growth have begun.

In the mid 2000s RFID was the hot topic in the supply chain and elsewhere. Many organisations invested in R&D projects to attempt to deliver on the promise of RFID. Some succeeded but many did not. The hype receded and RFID became a topic that we would keep watching in the hope that it would one day meet our expectations. So what has changed?

1. Cost-effective for an ever-increasing number of items and sectors

Cost has always been a major factor in RFID adoption. There has long been a recognised price point of $0.05 at which item level tracking in a retail scenario becomes viable. We’ve not reached that point yet but it is very close. A typical passive UHF RFID label now costs approximately 10 cents but to the right organisation ordering in the right quantities, the 5 cent tag is a realistic prospect. Back in 2005 an RFID label would typically cost 40 cents and that is not comparing like for like because it would lack the qualities and performance that the intervening years of innovation have brought. So while tracking low value consumables such as loaves of bread is not quite there yet, there is an ever increasing range of items where the return on investment for item level tagging is evident. In the USA, Macy’s and Bloomingdales have extensive item level RFID tracking in place through projects undertaken in 2012. In the UK, in January 2013 Marks & Spencer announced the extension of its RFID program to cover all clothing and home products in its 700 stores. These examples only cover retail. Within asset management across all sectors from banking to oil and gas to healthcare there is an ever expanding array of items where RFID tracking is now a cost effective proposition.

Of course cost is not restricted to tags – the infrastructure of readers, antennae and supporting hardware and expertise also needs to be considered. Here too, costs are reducing as more manufacturers enter the market and the technology matures.

2. More mature technology means reliability and usability

Another barrier to early adoption of RFID was the performance of the technology. In the mid 2000s RFID using UHF was in its infancy. In passive mode, only UHF offers the possibility of a read range of greater than 1 metre. Early systems would therefore need to work within the read range limitations of LF and HF tags or adopt more expensive Active tags. On top of this, each frequency has its own limitations with regard to how it behaves with materials with a high metal content or water content (including humans and animals).

In the intervening years the technology surrounding RFID has matured considerably. Passive UHF tags are now commonplace and are generally the preferred option in most environments. Coupled with this the standards of antennae design are much higher, further increasing range and reliability.

The range and standard of supporting hardware is much higher. More manufacturers mean more R&D and competition to produce the best readers at the most attractive prices. Huge strides have been taken in problems such as tag and reader collision. Specialisation has also increased as these manufacturers aim to support more diverse environments such as those involving extremes of temperature.

The technological advances associated with RFID are continuing. Innovation is continuing in areas such as energy harvesting and convergence with GPRS and Real-Time Locating Systems (RTLS), security of data and miniaturisation.

3. Global standardisation enabling information sharing

A further important area of progress in the last 10 years is standardisation. Key to this was the publishing of the EPCGlobal Gen2 standard in 2004. This provides an international standard for encoding UHF tags. Organisations are able to secure unique ranges of numbers for items and assets that are to be tracked using RFID tags.

Prior to these standards being in place many RFID implementations suffered from being closed loops where an organisation would encode tags to their own specifications. The result was that while they were able to read and interpret the scans themselves they were not able to easily share that information with external systems.

As more items are being tagged it has become essential to be able to share that tagged data across organisations and systems. The update of the EPC Global Gen2 standard has been a key factor in enabling this.

There is still further to go in this area. A key problem is in the assignment of UHF frequencies where because of historic assignments of military and other applications, Europe, USA and Japan have different UHF frequency ranges for RFID. In practical terms this does not have a direct impact on implementation as there are many tags designed to operate across the full spectrum. It does, however, create a headache for the hardware manufacturers and prevents opportunities for tags to be optimised for a specific range if they are meant for global distribution.

4. Growing and increasingly diverse user base

Another important driver towards RFID adoption is the global user base. The sheer range and diversity of implementation that has evolved over the last 10 years is breathtaking. The technology has moved way beyond straightforward asset tracking. RFID is found in passports, animal tracking, aerospace safety checks, motorway toll payment, locating essential equipment and even patients in a healthcare environment, time checking at sporting events and a myriad of other applications on a global scale.

With a growing user base and diverse applications comes further investment and improvement in the technology together with a declining cost.

In 2012 the global RFID market was worth $7.67 billion and some analysts have valued the RFID market at being worth $70 billion over the 5 years between 2012 and 2017. For any organisation where the tracking of assets and inventory is important, having a program to realise the benefits of RFID will be vital in keeping pace with the competition.

5. Supporting software and expertise is readily available

The final element in providing the environment for exponential RFID growth is the availability of supporting software and expertise to manage and implement it. Historically, the market has been very focussed on hardware technology and its progress. A sign of maturity in the market has been the way in which software companies are now able to take RFID and readily integrate it into their products. The increasing quality and reliability of the hardware coupled with the emergence of global standards and protocols has been the key driver for this. RFID is no longer the preserve of RF hardware geeks, and the availability of expertise to implement RFID solutions is rising as the costs to design, develop and maintain those systems is decreasing.

At Waer Systems, we have used standards such as EPC Gen 2 and LLRP to develop and deliver Cloud-based RFID solutions for tracking assets through the supply chain. Using scanner and antenna hardware from Motorola and Nordic together with tag technology from Smartrac and Confidex we have harnessed the potential of RFID for our customers. They are able to use WaerLinx and WaerConsole to keep track of items, identify trends and instigate operational activity against those assets. Using our WaerFlow integration module they can readily integrate this information with their MRP and ERP systems.

It is this ability to provide off the shelf RFID solutions that rapidly deliver the benefits of RFID and allow it to be integrated across the enterprise that provide that final impetus for its mass adoption and exponential growth

Follow this link to find out more about the Waer Systems RFID solution or alternatively, please use the form below.

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