Radio Frequency Identification (RFID)

Features of Radio Frequency Identification

TURNING FULL CIRCLE

The term Radio Frequency Identification (RFID), which describes a type of automatic identification system, was first heard of in the 1980s, when it was used to track applications. The genesis of the technology, however, can be traced to World War II, when it was developed by allied forces for radar operators, to enable them to distinguish between friendly and enemy aircraft!

What started out as a technology with predominantly defense uses, RFID has expanded the ambit of its coverage to include a range of applications such as transportation and logistics, manufacturing and processing, security, animal tagging, waste management, time and attendance, postal tracking, airline baggage reconciliation and road toll management. RFID, which offers users more granular, accurate information and provides a means to automate processes that are manual, has proved itself as a technology that results in dramatic supply-chain improvements.

MARKET FORECASTS

The market forecasts for RFID vary. However, here’s what key analysts are predicting about the market:

Frost & Sullivan’s latest report on the World RFID-Based Applications Market reveals that the industry generated revenues totaling US$1.7 billion in 2003. The turnover of this industry is expected to grow to US$ 11.7 billion by 2010.

Datamonitor has forecast a US$ 5-20 billion European market for intelligent tags and their equipment in year 2005, including the UK.

Frost and Sullivan sees a $10 billion global market for RFID and EAS systems in 2005
based RFID systems, including tags, touched around US$ 1.4 billion in 2002. The market for the tags including smart labels was estimated to be around about US$ 0.7 billion.

Global research conducted by IDTechEx, predicts that by 2013 the RFID market will be worth US$ 10 billion, with 50 percent of the revenues being accounted for by hardware (tags and readers) and the rest by software, services and infrastructure

The leaders in smart labels are each shipping 60 to 120 million chip tags a year, i.e., valued at around US$ 100 million each for the tags alone. Philips, as the largest supplier of RFID chips (one per tag) says global consumption for smart labels is expected to be approximately 1.9 billion units in 2004. In the segment of systems and tags, TransCore has sales of US$ 350 million and Savi Technology has US$ 65 million. All the leading analysts see double-digit growth (typically in the region of 25 percent yearly) of RFID markets by value over the next few years. None of the above forecasts for RFID include RFID contact-less smart cards and tickets.

IT MAJORS: GEARING UP FOR RFID

A number of global and Indian IT software and services companies have started vying for a piece of the RFID pie. IT vendors such as Oracle and others are building supply-chain and warehouse management applications that can work with RFID data. Sun Microsystems, for instance, is building a middleware based on standard specifications for RFID and SAP has released middleware products for linking RFID readers to back-end applications and monitoring business-process expectations.

Closer to home, leading Indian IT software companies have taken significant initiatives on the RFID front. Newsline provides a peek into the RFID strategies of a few IT software and services companies:

COGNIZANT

The solution: Cognizant provides an end-to-end RFID solution, spanning applicability assessment, technical and ergonomic feasibility, scenario modeling, ROI analysis and pilot planning, solution architecture, application development and implementation.
RFID strategy: Currently, Cognizant is working on pilots and proof of concepts for some of its customers across verticals in the area of palette and case labeling. Plans are afoot to extend it to item labeling when the prices of RFID tags drop to realistic levels. As the standards for RFID are still evolving, Cognizant's Centers of Excellence are closely tracking trends in this space before large-scale deployment for customers. Cognizant has set up a dedicated RFID Competency Center and Lab in Kolkatawhich houses its Retail Center of Excellence, for developing and testing RFID solutions.

Cognizant has also built an RFID simulator for software based testing of the RFID architecture. The Lab is currently focused on developing a scalable middleware environment to handle enormous amount of data generated by RFID readers and to bridge the gap between the middleware and the backend systems

INFOSYS

The solution: Infosys offers a comprehensive solution for RFID adoption which includes a range of services from concept-to-implementation. The solution enables clients to evaluate the technology in their business context, build a business case, and develop a roadmap for phased adoption. Infosys' RFID solution stack includes pre-built tools, templates, frameworks and reference models that enable customers to unravel the disruptive potential of this technology. Edge Server Lite, the company's ready-to-deploy software stack for RFID event management and integration helps customers to rapidly embark on their RFID initiatives enabling faster time-to-market at a lower total cost of ownership.

Chitale Digitals

In the RFID segment, the company manufactures "Mifare RF Cards" and "Hitag RF Cards". The Mifare Card system is used for "Attendance and Data Management" applications. The Mifare smart card is a contact less or dual interface RF card. Built on the Mifare architecture the product is centered around ISO/IEC 1443, type A standards. Mifare cards and readers are developed by and manufactured by Philips Semiconductor.

The Hitag RF Cards, consisting of read/write devices, data carriers and Antenna readers represents a new generation of secure passive RFID system. HITAG is the first passive RFID system with anti collision capabilities. This allows several data carriers to operate simultaneously within the communication field of Antenna.

So far, the company has completed installations at the Bhabha Atomic Research Center, IRCON and Philips, among other sites.

Patni Computer Systems

PCS set up an RFID lab eight months ago. Supply-chain and RFID consultants man the lab and it has already delivered an RFID pilot based on Auto-ID’s RFID framework that integrates into a SAP back-end for processing transactions.

Wipro Technologies

To understand the issues surrounding RFID deployments in a retail setting, Wipro Technology has started testing RFID in a retail store. The company operates on the campus of its headquarters in Bangalore, India.

In early July, Wipro finished building an RFID system in the 1,000-square-foot campus store. According to Wipro, designing, developing and deploying its own RFID pilot provided the company with a great deal of first-hand experience regarding the kinds of issues its retail customers will face with their own deployments. Besides highlighting the requirements of middleware and software integration, the project also taught the company about the significance of a site survey, the need to design and deploy RFID hardware within the context of the business for which it is deployed, the importance of antenna orientation for smart shelves, the impact of an RFID system on existing business processes and applications and the amount of work required to develop new systems to work with RFID.

Indian IT companies, therefore, need to take a closer look at RFID and enter a market that is expected to rapidly expand over the next few years. As the cost of RFID implementation comes down, standards emerge and users develop stringent safeguards on how RFID systems are deployed (taking care of privacy issues), the market will offer significant opportunities for Indian IT software and services companies. Against this backdrop, Indian Tier 1 and Tier 2 vendors need to develop expertise in providing customized solutions for RFID and perhaps set up separate practices focused on the technology