RFID: More Hype Than Matter?

RFID is not likely to open more application areas that already did not exist.
Only thing is that it makes it much more easier and less difficult to deploy.
This is because RFID itself brings a lot of value add to the application.

At the same time, it would open applications which were earlier not possible
at all, like identification, though this would constitute a very small
percentage. And it has made entry into this business solely because it was not
possible to use any other technology.

WILL IT CONQUER BAR-CODING

In recent times, RFID has gained more popularity because it potentially has
as broad an application as bar-coding. The latter is very proven and dynamic
with developments happening all the time. RFID would cater to all those needs.

RFID won't take over bar-coding in the near future. But it will take over a
lot of places where bar-coding was difficult to deploy. It is technology which
complements bar-coding since it overcomes all the limitations of the latter.

RFID can be categorized in two parts. The first is the niche application
specific deployments, which even if the costs are high, people will still
deploy, because the benefits outweigh the investment. The other is the
run-of-the-mill solutions like product identification or tracking, where the
volumes are huge. But lots of market players would like to have some
standardization so that it is inter-operable.

There are two major agencies fueling the worldwide RFID growth in a serious
way. The first is the US Department of Defence and the other one is Walmart.
However, even they are trying out only pilots.

ADVANTAGES OF RFID

In this technology, since it operates through radio frequency, it need not
be in the line of sight, like bar-coding. It needs to be only in the coverage
area and it will be read by the sensor. It can also be dynamic, so one can read
and write the variable on the tag. Also, multiple tags can be read at the same
time.

Keeping these three facets in mind, for all applications where this becomes
an essential part, RFID is useful. It is ideal for healthcare, food tracking,
retail, electronic article surveillance or even the hospitality areas as well.

In the government segment, there are various verticals that can be addressed
like transportation, warehousing, logistics, manufacturing or security. From an
administrative standpoint, it also has potential in document tracking and
management. And if the government comes out with a national card, that too can
be RFID-based. There are higher-end solutions as well, like railroad tracing,
fleet management or toll collection.

PROFILE OF A PROVIDER

A solution provider who wants to offer RFID needs to have a very good
understanding of the nuances and varieties of tags, readers and frequencies
available. Because there is "no one-solution-fits-all" here. The
technology is driving the application, it should be the other way around. The
solution provider should have a good understanding of this so that he can pick
and choose the right one for his customer.

WAY TO GO

RFID is dynamic and can read and write variables on one or more tags Ideal for healthcare, food tracking, retail and electronic article surveillance Service and consumables are continuous revenue streams

He also should have a good amount of domain knowledge of the application
area, so that he is able to understand where it can and can't be used. Just
because RFID can be used in a particular vertical in one organization, it does
not mean that the same can be deployed across the board for the company's
needs.

The partner should also have knowledge to integrate these solutions to the
back-end applications. Because this is where, ultimately, all the data is going
to go in. It complements to existing solutions like ERP, so data flows
seamlessly across different platforms. Also, he needs to have the technical
expertise to service the solution after deployment as well.

Service and consumables are a continuous revenue stream in this business.
Because the reader may be one, but the number of tags that will go through the
reader during the lifetime of the solution will be tremendous.

But often the consumable revenue slightly over-clouds the thought of the
solution provider. They are carried away by the idea of potential to sell tags
over here. It is not the right way to approach the business, though it is the
ultimate destination.

DEPLOYMENTS OPPORTUNITIES

There is a lot of scope for RFID-based solutions in the automobile industry,
and some deployments are already taking place, though it is at a pilot stage.
There is a huge amount of spare parts that need to go to the market as a
secondary offering.

Retail is another good business segment, because there is a lot of product
surveillance tags that are attached to goods to avoid theft. It can also be used
to prevent pilferage in manufacturing or sales divisions.

In healthcare sector, there is a need for solutions that can track expiry
dates. There is also some awareness happening in the telecom sector. There are
pilots happening all over the place, with a company using the technology for its
asset tracking.

So, there is good scope for the technology to make inroads in most business
verticals. But this won't happen overnight, and that is what solution
providers who get into this business have to bear in mind.

KAUSER AYAZis
Director Scan Infotech.