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Spread of RFID
Two recent reports from ABI Research discuss the rapid expansion of the market for RFID, the tagging technology that promises a mass of detailed data for retail and other sectors. The agency has reduced its market forecast for 2007, and highlights particular problems establishing standards for RFID in China.
ABI last week reduced its 2007 market forecast for RFID software and services revenue to $3.1 billion, about 15% down on previous estimates. RFID practice director Michael Liard is keen to stress that the revision 'results from the current direction of RFID's evolution, not from any decline in the industry.' Among the conditions responsible are:consolidation among industry vendors and service providers will eliminate significant overlap- increasing standardization of the technology, which is fostering collaborations between technology partners - these 'mitigate software costs because users do not need to seek multiple sources'
- the growing availability of off-the-shelf commercial RFID software packages, and
- improving project planning skills in the area, along with integration of the technology into wider corporate strategies, leading to less waste and less software needing premature replacement.
The report, Focus on RFID Software: Investigating New Solutions and Approaches discusses these trends in depth.
Meanwhile the issue of RFID standards in China is being clouded by the national government's silence and by aggressive marketing by EPCGlobal, according to ABI. Official efforts toward setting a Chinese RFID standard remain in limbo, while conditions on the ground are rapidly changing.
In June, the government published a Chinese RFID technology policy white paper which made no mention of the standards issue. Meanwhile, ABI says RFID manufacturer EPCglobal is moving aggressively into the heartland of Chinese manufacturing and turning its UHF G2 standard into a de facto standard. Both supply chain partners and foreign clients are likely to require Chinese manufacturers to use RFID tags complying with this international standard.
According to ABI Research analyst Junmei He, 'The reality is that for the Chinese government, it is no long important when the national standard will be released. It is late already. More urgent problems are to decide how the government should cooperate or negotiate with EPCglobal; to establish policies to protect the development of the domestic RFID industry; and to secure the benefits of RFID for Chinese tag users in the coming RFID era.'
The report is entitled The RFID Market in China: Assessment of Chinese RFID Market Opportunities and Regulatory Issues. ABI's web site is at www.abiresearch.com .
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