IBM Expands RFID Offerings

Adds services to speed benefits of radio frequency identification systems for industrial companies, mid-market businesses

Adds services to speed benefits of radio frequency identification systems for industrial companies, mid-market businesses

Chicago — September 29, 2004 — IBM has rolled out a suite of services intended to speed the benefits of radio frequency identification (RFID) systems for industrial companies and mid-market businesses.

The newly announced services for industrial companies include consulting, development of the RFID business case, technological proof of concept, internal pilot, trading partner pilot and full rollout of the systems. The new services are geared toward the automotive industry, aerospace and defense, manufacturing, chemicals and petroleum, forest and paper and electronics companies.

IBM said its RFID consultants assess a client company's operating environment and test parts and products for RFID performance. Testing is done at the client's site and at IBM's RFID test centers, located at IBM's facilities in Yamato, Japan; LaGaude, France; and Gaithersburg, Md. In addition, customers are supported by IBM Research to develop specialized systems and tools for unique needs.

Big Blue said its has partnered with Philips Semiconductors in providing RFID-enabled solutions. Entering the RFID arena early as an RFID chip maker, Philips also initiated a joint trial with IBM in November 2003 to improve the business processes within the manufacturing and distribution supply chain, inventory management and control as well as to enhance customer satisfaction. Piloted at Philips Semiconductors' Kao Hsiung manufacturing site in Taiwan and its distribution center in Hong Kong, IBM and Philips tagged wafer cases and carton packages with RFID chips during the trial.

"From the outset our relationship with IBM was designed to improve time to market and customer confidence," said Saleem Miyan, head of global strategic alliances for the identification business at Philips Semiconductors. "The combined value of our brands and expertise has proved a tremendous asset in the rapidly evolving market for RFID solutions."

"While IBM has seen explosive growth in demand for RFID in retail and consumer product goods, increasingly IBM's industrial customers are using RFID to cut costs, improve quality and create efficiencies on the plant floor, in warehouses and transportation," said Faye Holland, worldwide RFID solutions leader for IBM Global Services. "Equally important, RFID is serving mid-market companies by helping them compete in a global marketplace."

IBM's RFID offerings for mid-market clients include a solutions development workshop, site survey, pilot and testing services. One IBM mid-market client in Japan is Kureha Environmental Engineering. A leading waste management company in its homeland, Kureha is working with IBM to test the use of RFID tags for tracking medical waste, the first ever such pilot in Japan.

Recent mandates from the Department of Defense and the implementation of the Transportation Recall Enhancement, Accountability, and Documentation (TREAD) Act also have spurred growth in the adoption of RFID systems outside of the retail industry. The Department of Defense said last year it wanted its suppliers to start attaching radio frequency identification tags to their goods by Jan. 1, 2005, and IBM is advising the U.S. Department of Defense on the use of RFID. The TREAD Act contains provisions requiring vehicle and equipment manufacturers to report on a wide variety of information that could indicate the existence of potential vehicle safety defects.