For the past few years, the automated supply chain evangelists have been stalking the conference circuit with talk of revolution. Radio frequency identification (RFID), they say, will speed up logistics and distribution by such a huge factor that any organisation failing to implement the technology will swiftly be dispatched by nimbler, RFID-ready competitors.
Further down the line, supermarkets will be able to wave goodbye to their checkout staff - customers will simply wheel their trolley through an RFID reader, their bill will instantly be totted up and the relevant amount automatically deducted from their contactless payment card.
Currently though, we're a long way from radio frequency retail utopia. "Today, the take-up of RFID is pretty much limited to niche applications," says Alan Melling, senior director for business development at Symbol Technologies. Indeed, it is already well established in markets such as access control, livestock tracking, laundry tagging and transport payment systems.
But as the cost of readers and tags comes down and issues of standards and broadcast regulations are addressed, there will be significant opportunity for VARs and solution providers to develop radio tagging applications for customers which have not previously considered the technology. "The great untapped market is the supply chain, where RFID has made little or zero progress over the past five years," Melling says. "There's a lot of possibility there - a lot of potential applications."
However, there are a number of obstacles in the way of widespread implementation. The first is the limited read range of current RFID tags. Most systems in the UK today operate on the 13.56MHz band, which offers a maximum range of around a metre, although usually far less.
Tagged items generally need to pass very close to a reader, which often means scanning them manually. In many cases, customers see little reason to change from cheaper bar coding systems.
Despite this, some companies are beginning to pilot the technology in limited parts of the supply chain and are seeing significant benefits. Depending on the application, type of technology and method of implementation, it is possible to obviate the need for manual scanning.
Aileen Ross, industry marketing manager at bar coding systems and RFID tags supplier Zebra Technologies, says: "Marks & Spencer has been trialling RFID in its fresh food logistics operation. The company used to bar code all the individual trays of products at its distribution centre and scan each one manually. Now it has moved to RFID tags, staff can push a dolly containing 36 trays through a portal reader and read them all simultaneously. The system will raise an alarm if there's something on there that shouldn't be."
Ross adds that RFID has reduced "tremendously" the time it takes M&S to ship food out of the centre. She also notes that other big retailers are running pilot RFID projects in parts of their distribution operations. Other burgeoning areas, she says, include library and document-tracking applications.
Even where tags have to be scanned manually, RFID still offers notable benefits. Tags can store much more information than a barcode and some are writeable (not just read-only). They do not require a line of sight between tag and reader and can be read through packaging. They are also more robust than bar codes, which makes them ideal for hostile environments. Ross cites the example of breweries using encapsulated RFID tags to track beer kegs.
"Because they're encased in tough plastic, they're resilient to the hostile processes which the keg has to undergo, such as sterilisation and being rolled around dusty pub cellars," she says.
Nevertheless, there are other factors holding back the RFID market. With 13.56MHz technology, the read range is nowhere near sufficient to bring about a revolution in the supply chain. For that, products need to operate on the higher-frequency UHF band, which has a range of up to 10m. And with the use of more expensive 'active tags' (which have their own power source - see Technology Overview, below), this can be extended considerably.
But although such systems are available in Europe, there are stringent power restrictions here on the use of the 900MHz UHF band which (largely American) manufacturers have adopted as de facto standard. The current regulatory framework renders these products barely more effective than their 13.56MHz counterparts on this side of the pond.
Melling says: "People are attempting to address the issue by proposing dual-mode tags that are frequency-agile between 900MHz in the US and 868MHz in Europe, but this assumes the European regulators will at some point adjust to the reality that a larger power requirement is needed. I can see consensus emerging that this is what has to happen, but we're still waiting for concrete actions."
In the meantime, he says, VARs and resellers interested in the potential of the technology would be wise to start developing UHF supply chain applications in anticipation, as well as looking at 13.56MHz RFID for applications where a long read range is not important.
Others disagree. Peter Jones, managing director of security solutions provider Third Millennium Systems, believes uncertainty over standards and regulation means it is too risky to bet on the higher-frequency band. "At least for the time being, UHF looks pretty much dead in Europe," he comments.
Jones says all the current activity is with 13.56MHz technology. And he believes this market is far from fully exploited. "For example, there's a lot of activity in the airline area at the moment, with a surge of interest in applications such as smart labels for luggage," he says.
He also advises VARs and developers to research the market carefully and select appropriate suppliers as partners. "Philips has some great technology in terms of the performance and low cost of tagging, but little in the way of support - it
just supplies bland component technology. Other companies such as Legic offer co-marketing opportunities and complete applications," he says.
A long way off
Another sticking point has been the price of tags, although Melling thinks this is becoming less of an issue. "They're reasonably cheap now. You can get passive tags [those without their own power source] for 50 cents each - even cheaper if you buy in volume. If you can't justify that, do you really have an application? Do you really understand what your payback is?"
But while opportunities in the supply chain are beginning to emerge, those hoping to make a killing by automating the supermarket checkout may have a long wait.
"It's not an unreasonable concept, but are you really going to put a 50p tag on a 10p tin of beans?" asks Ross. "Until tags become commodity items you're not going to get to that price point. Then there are the technical problems to deal with. For a start, supermarket trolleys are metal and have been shown to interfere with readings. I'd say we're still about ten or 15 years away from resolving all these issues."
Different RFID systems operate on different frequencies. Older systems work on lower frequencies such as 125kHz band, which has a maximum read range of 10cm.
At the other end of the spectrum, 900MHz UHF systems have a read range of up to 10m (or more using active tags), but power output is currently restricted on this band in Europe. The higher the frequency of the system, the higher the cost of tags and readers.
The main market in the UK is for 13.56MHz systems, which use passive tags and have a maximum read range of up to 1m. Tags can be passive or active. The former range in price from around 50p to £1, depending on the amount of information they can store, whether they're read-only or writeable and the quantity purchased.
Active tags, which are generally only available for higher-frequency systems, have their own power source, which extends the read range significantly (one supplier claims up to 85m).
They are also usually encapsulated, making them more resilient. However, they are a lot more expensive, costing from £2 to £15 a tag, again depending on functionality and quantity purchased.
For more detailed information on manufacturers, standards and technology progress, a good starting point is www.aimglobal.org
On the UHF band, the MIT is gaining wide US industry support for its Auto-ID initiative (see www.autoidcenter.org) while in Europe the EAN.UCC is aiming for a global tag standard with GTAG at www.uc-council.org/global_tag/gtag_home.htm
An exhaustive list of RFID suppliers can be found at