ABI's RFID Trends for 2006

World looks to North America, EPCGlobal looks to the enterprise, and label converters look for position, analyst firm reports

World looks to North America, EPCGlobal looks to the enterprise, and label converters look for position, analyst firm reports

Oyster Bay, NY — January 9, 2006 — Radio frequency identification (RFID), one of the hot technologies of 2005, shows every sign of maintaining that status in 2006, according to a new report from technology analyst firm ABI Research.

The latest release of ABI's "RFID Research Service" highlights three trends in a market already experiencing rapid growth.

First, the RFID market is becoming increasingly global, but the United States remains a very important piece of real estate within it. Recent months have seen a number of RFID tag and reader vendors based outside the United States working to establish footholds and strengthen their presences in North America.

Hailing mostly from Japan, South Korea and Europe, these companies include Sato, KSW Microtec, Rafsec, Siemens, Omron and Samsung, and they are refining their channel strategies for the region. According to ABI Research's director of RFID and ubiquitous networks, Erik Michielsen, this is generally a good thing: "Increased competition, and the infusion of international perspectives, will have a beneficial effect on the markets."

EPCglobal Eyes Expanded Role

EPCglobal is, in 2006, trying to play a role in determining reader/network interface standards. But this is traditionally the territory of technology giants such as Microsoft, Oracle, SAP, BEA Systems, Sun Microsystems and IBM. "There is debate in the market whether by moving into the enterprise in this way, the organization is overextending itself," says Michielsen, "or whether this is something that will benefit the industry in general. ABI Research has an open mind on that issue."

Finally, ABI believes that 2006 will be the year for label converters to jockey for position. There are dozens, if not hundreds, of companies that assemble labels and prepare them for mounting. They are urgently assessing their positioning and differentiation: Should they choose high-volume, fast-moving consumer goods? Temperature-sensitive grocery supply chain environments? Security-sensitive item-level pharmaceutical tracking?

There are large market opportunities and niche opportunities, and how well these companies position themselves will have a great impact on their success, ABI reports.

The "RFID Research Service" is a subscription-based offering that includes market updates, research reports, industry and forecast databases, and an ABI Research Vendor Matrix.

Additional Articles of Interest

— A recent independent study revealed that Wal-Mart customers are finding the items they wanted in stock more often due to the retailer's use of RFID technologies when compared to control stores. Read more in "Wal-Mart Achieving Improved On-shelf Availability with RFID, Study Finds" on SDCExec.com.

— Leading crafts company Creativity Inc. has found that, with a bit of trust and a lot of teamwork, a little consulting can go a long way in addressing supply chain pain points. Read more in "Crafting Success in Supply Chain Transformation," cover story in the December 2005/January 2006 issue of Supply & Demand Chain Executive.

— If you're looking to develop the best strategy for connecting to a broader base of suppliers, read the SDCExec.com exclusive "Want to Get More Out of e-Procurement? Put More In"

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