U.S. demand for radio frequency identification (RFID) labels is projected to increase a staggering 131% annually from 35 million units in 2004 to 2.3 billion units in 2009, according to a recent study by the Freedonia Group Inc.
By 2014 RFID tags are expected to account for 85% of the smart-label market, which includes electronic article surveillance (EAS), interactive packaging labels and RFID, the Cleveland-based industrial market research firm reported.
Currently EAS labels dominate the smart-label market, but that's expected to change with RFID mandates from retailers and other industries, most notably Wal-Mart and the Department of Defense. Adoption of RFID systems has been slow because of high tag prices, but RFID labels should become less costly as economies of scale are achieved.
Interactive packaging labels, including thermochromatic and time-temperature indicator products, also show strong growth increasing 22.5% annually from 2004 to 2009.
Demand for EAS labels is expected to remain almost stagnant, with demand increasing only 2.2% annually.