RFID Markets Staying Strong: 21 percent Annual Growth Predicted through 2012

Pilots, closed-loop deployments demonstrating value proposition and cost justification for radio frequency identification in diverse sectors, ABI Research reports

New York — November 23, 2007 — Starting from a base of more than $3.8 billion in revenue in 2007, worldwide radio frequency identification (RFID) markets are expected to reach $8.4 billion in 2012, according to a new study from ABI Research.

The 2007 figure represents a 24 percent growth over 2006, and the curve to 2012 indicates a compound annual growth rate of 21 percent.

"Given the recent amount of activity and anticipation surrounding RFID technology, one might be tempted to believe the RFID market has been experiencing explosive growth," said Michael Liard, research director with ABI. "But while uptake of full-scale RFID systems remains slower than many in the industry had hoped, steady growth continues. There is an overall sense of cautious optimism in the market."

Pilots Demonstrating Value

While few large RFID implementations have been announced, extensive pilot programs and closed-loop deployments are demonstrating the value propositions and cost justification for RFID. For example, asset tracking in health care, work in process (WIP) tracking in manufacturing, and returnable transport items such as pallets and containers provide a significant return-on-investment and the opportunity to amortize the cost of transponders over several years.

The new ABI Research study provides an overview of vertical and application markets for RFID systems. It is intended to offer a detailed snapshot of the RFID industry landscape, including application and vertical market considerations, end-user survey results and key market trends. It also includes a "what's hot and what's not" section, designed to highlight top trends, applications and more substantive developments.

What is hot? "Asset tracking and RTLS applications continue to gain traction across vertical markets," said Liard. "From pilots to small implementations to full deployments, activity has been brisk for passive and active solutions. The fashion apparel and footwear item-tagging market is also undergoing heavy pilot and trial activity, especially within Europe via programs at Marks and Spencer and Metro."

Liard added that government ID documents are another strong volume segment, particularly for e-passports and national ID cards, as in China, for example.

More information on the study is available at the ABI Research Web site, at www.abiresearch.com.