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'RFID carries unconditional guarantee of success' - Study
Feb '09
The RFID market is set for further robust growth, despite many a challenge. While turnover is likely to increase by an average of 19% p.a. in Germany between 2006 and 2016, the pace may reach as high as 25% p.a. worldwide. With the shift in the market shares of individual RFID components and the exodus of production of less sophisticated products from the high-wage countries, Asia is likely to contribute an ever increasing share and become the continent with the strongest turnover by 2016.

RFID links the physical good with the corresponding information. In fact, the RFID principle has been used in a broad spectrum of military and civilian applications for decades. However, it was not until the introduction of the electronic passport and the use of RFID tags on some consumer goods in the retail sector that public interest in the technology surged.

Political and technological challenges will shape RFID's commercial outlook. In the technology area, the issues seem to focus primarily on energy consumption, production costs, manufacturing speed and reading errors, while politically the focus will be on frequency harmonization, standardization, and environmental and data protection.

Not every RFID project driven by a technological vision will become a commercial success. Before they start using RFID, companies must take a critical look at the cost and income aspects. RFID promotes innovativeness in the economy as a whole. RFID-based process automation not only boosts the efficiency of innovative companies, it is also instrumental in expanding the overall supply of goods and services.

Information and communication technologies are playing an increasingly important role in the implementation of value-added processes that overarch several steps. Specialists in corporate foresight say that Radio Frequency Identification (RFID) technology in particular is a very symbol of the paradigm shift. In the new paradigm the separation between the physical good and the information corresponding to it is eliminated.

RFID is not a brand new technology, however. Back in the Second World War the Allies used the same principle to distinguish between friend and foe. In the 1970s RFID came to be used more and more often in civilian applications as advances were made in microelectronics. The broad spectrum of applications ranges from logistics and trade, industry and agriculture right through to health care and leisure events.

However, it was not until RFID became more relevant in everyday life – e.g. with the electronic passport, labels on certain retail goods and access cards in the workplace, that the public started to take substantially greater notice of the technology.

Systems have three technical components:
Every RFID system consists of an RFID tag (also: transponder, a small chip encoded with a product number and containing a radio antenna, see box), a reader and data-processing software. RFIDsystems work on the principle that the individual components can communicate with one another via electromagnetic fields without physical or visual contact. This form of information exchange differentiates RFID from other information systems that use a bar code or contact chip card, for instance, as well as from radio-based systems such as Bluetooth.

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