RFID Strategy -- RFID Poised For Growth In 2007

Dec. 18, 2006
A 19.6% growth rate will be facilitated by common standards, RFID product availability and lower prices.

The latest market forecast for deployment of radio frequency identification (RFID) technology in North American manufacturing and logistics operations have been received with some skepticism by those who recall hearing similar positive projections for 2006 about this time last year. But several factors suggest that the RFID market is in a much better position to grow in 2007 than it was a year ago.

Research firm Frost & Sullivan projects that the total North American RFID market for manufacturing and logistics will grow at a compound annual growth rate of 19.6% through 2012; growing from $74.8 million in 2005 to $261.8 million in 2012.

Several factors have come together to make the rate of growth forecast by Frost & Sullivan possible:

  • Standards have come together, which has allowed product manufacturers to develop RFID hardware that is more interoperable, making it easier to mix-and-match equipment.
  • Most manufacturers of RFID tags and equipment are capable of meeting customer demands accompanying a 20% annual growth.
  • The price of RFID tags is falling slowly as usage increases. Tag prices today are in the 10- to 17-cent per tag range when purchased in volume. While a 17-cent RFID tag may still be too pricey to use on a $2.49 tube of toothpaste, it might be priced just right for a $249,000 piece of medical equipment.

In 2006, a large number of organizations engaged in pilot tests of RFID, typically deploying the technology in a specific location with a limited number of products. These pilot tests have allowed organizations to get a better understanding of how the technology works; discover the factors that can affect its performance; and identify sources of return on their investment.

Still, there are challenges that could hold back double-digit growth. There remains a shortage of people skilled in the technology to support the level of growth projected by Frost & Sullivan. Companies are beginning to realize that RFID has unique requirements that the typical information technology (IT) technologist does not have the skills to address. Most of the skills that are lacking are in the areas of understanding how the physics of radio frequencies work and how to tag items so that they are readable.

The good news is that are more RFID educational offerings available today, making it possible for organizations to measure the capabilities of their employees, consultants and contractors. There are a variety of "boot camps" teaching basic RFID skills. Vendors are offering product-specific product training to their partners. And academic institutions and commercial training providers are now offering RFID training and courses.

The industry has also come together to develop an industry accepted credential that validates an RFID technician's knowledge and skills in the areas of installation, maintenance, repair, and upkeep of hardware and software functionality of RFID products.

CompTIA RFID+ is a professional vendor-neutral certification that is addressing the need for technicians knowledgeable and skilled in areas such as the installation, maintenance, repair, and upkeep of hardware and software functionality of RFID products. The curriculum built to support this certification has become an industry standard of foundation-level skills for the RFID technologist.

But while the workforce is becoming more educated, having 20% more skilled RFID technologists available in the next 12 months may be problematic.

David Sommer is vice president of electronic commerce for the Computing Technology Industry Association (www.comptia.org), the leading trade association representing the business interests of the global information technology (IT) industry. He is responsible for developing and implementing worldwide initiatives by working with IT leaders to develop and promote collaboratively-defined business and technology standards for business-to-business transactions in the computing and electronics industries.

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