RFID

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RFID

• Myths, Facts and Reality

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What is RFID?

• Radio frequency identification or RFID
• Generic term for technologies that use radio
  waves to automatically identify things
• Happens with a serial number that is embedded in
  a chip
• That microchip has an attached antenna (the chip
  and the antenna together are called an RFID tag).
  
• The antenna enables the chip to transmit the
  serial number information to a reader.
• The reader converts the radio waves reflected
  back from the RFID tag into digital information
  that can then be passed on to computers that can
  make use of it.

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How Does an RFID System Work?

• An RFID system consists of a tag and a reader
• The reader sends out electromagnetic waves
• The tag is tuned to receive these waves
• RFID tag draws power from the field created by
  the reader and uses it to power the tag
• The chip uses that energy to send the serial
  number back to the reader

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RFID Made Simple

• I saw this tag
• The tag could be on anything like
• A bag of chips
• A box full of chips
• A pallet full of boxes of chips
• A truck full of pallets of boxes of chips
• At this time
• Usually expressed in UTC
• At this location
• The location could be anywhere like
• The end of an assembly line
• A dock door
• A store shelf

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What does a tag look like?
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RFID Myths

• Myth 1 RFID will replace bar code
• In reality, these are two complementary
  technologies
• While RFID can store more data than bar code, bar
  code is much cheaper
• Myth 2 RFID tags will cost pennies
• The Auto-ID Center published data that assumes
  market volume of 30 billion units per year (which
  they claim actually represents just two major
  manufacturers volume) would result in a tag cost
  of 3 to 4 cents with a sale price of 5 cents
• The chips themselves would cost 1 penny
• The ePC Group is being a little more realistic by
  estimating costs of 15 to 50 cents over the next
  few years

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RFID Myths

• Myth 3 RFID is simple to deploy
• RFID works in the RF environment
• Which is effected by moisture, weather,
  radiation, invisible RF interference, and even by
  the material of the building in which it is used
  and the materials stored in that building
• Also varies depending on the material to which
  the tag will be affixed
• Each individual RFID application requires unique
  programming and customized database software
• Each class of items to be tagged requires a
  unique tag designed for that item's material
  composition and usage environment
• There is no universal tag.
• Tags need to be specific to the problem you are
  trying to solve

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RFID Myths Meets Reality

• Myth 4 RFID is not ready for prime time
• RFID is ready now!
• It's been used for years.
• It's tracking animals
• it's collecting tolls
• it's been improving car assembly since the early
  1980s.
• Each industry and company will find a different
  opportunity
• Retailers will reduce out of stock no sales,
• Which cost billions of dollars each year.
• Manufacturers use RFID perfecting the production
  process
• Eliminating errors, and in making recalls easier
  and better focused

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More Reality

• Wal-Mart is already on board.
• "we have asked our 100 top suppliers to have
  product on pallets employing RFID chips and in
  cases with RFID chips By 2006, we will roll it
  out with all suppliers."
• The U.S. government is converting to RFID.
• The Department of Defense (DoD) is embracing RFID
  and will have an even greater effect on the
  industry than Wal-Mart

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Wal-Mart's RFID initiative

• The Bottom Line 3 Billion Dollars!
• Beyond compliance, if RFID provides just a 15
  improvement in product availability based on
  standard stock-out levels,
• Wal-Mart could reap a 3B increase in sales
• Benefiting not only Bentonville, but every
  supplier whose products are easier to find and
  restock.

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Others

• NEC signed a contract with the Bank of Nagoya,
  Ltd. to use RFID for document protection
• Identity and document management is going to be
  the next frontier, and here the intent is to use
  RFID
• "with employee identification systems using cards
  or fingerprint sensors or tags. The RFID system
  could help enable real-time recording of which
  employees are removing or replacing which
  documents, whether authorized or not, from a
  filing cabinet or room."

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Others

• In mid-January 2004, an article in the Wall
  Street Journal (WSJ), author Charles Hutzler
  talked about how the Chinese government, along
  with a number of Chinese private companies, was
  about to use its clout to influence RFID
  standards.
• He noted that the government had formed an
  interagency group to draft standards for RFID
  tracking technology. Potentially, this group
  could wield enormous power and influence in the
  standards arena.
• Think its unlikely?
• First, 70 of Wal-Marts goods comeeither
  directly or indirectlyfrom China.
• Second, Chinas 438 billion in exports last year
  and its growing role as a worldwide manufacturing
  hub give the country a legitimate say in
  determining RFID standards.
• In the past, the Chinese have been forced to
  adopt some technologies and standards that were
  developed outside their country. A good example
  is Wi-Fi. This meant they had to pay huge
  royalties. And, with the Chinese government, its
  not just the money that matters its a matter of
  their pride. Theyre not going to idly stand by
  while U.S. retailers decide their future. And,
  that includes RFID.

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Others

• Delta Plans U.S.-Wide RFID System
• The airline carrier will spend up to 25 million
  during the next two years to roll out an RFID
  baggage-handling system at every U.S. airport it
  serves.
• Singapore Seeks Leading RFID Role
• With the goal of becoming Asias foremost center
  for RFID technology, the island-republic will
  invest millions on research and training.
• Symbol Acquires Matrics
• The provider of portable data terminals and bar
  code scanners buys one of the leading makers of
  EPC-compliant RFID tags and readers for 230
  million.

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Press Release

• FOR IMMEDIATE RELEASE - Use of RFID Technology by
  Pharmaceutical Industry to Rapidly Increase
  During Next 18 Months, Says META Group
• RFID Use by Pharma Firms Will Surpass That by CPG
  Companies,Providing Cost Savings in Five Key
  Areas
• Inventory Management enabling improved inventory
  visibility, create an individualized expiration
  date based on the environment's effects on the
  active ingredients.
• Recalls Product recall, able to respond more
  efficiently and quickly in identifying the
  recalled product.
• Patient Safety positive identification measures
  (e.g., patient identification, unit-of-dose bar
  coding)
• Product Diversion Diverting drug shipments from
  low-cost regions to higher-cost regions costs,
  Positively identifying shipments and tracking
  them to their intended destinations
• Counterfeiting Drug counterfeiting is a serious
  health issue, implement formidable obstacles to
  counterfeiting.
• Penni Sanchez
• META Group, Inc.
• [phone]
• penni.sanchez_at_metagroup.com
• Alan Katz
• Cubitt Jacobs Prosek
• [phone], ext. 211
• alan_at_cjpcom.com

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Resources

• http//www.epcglobalinc.org/
• EPCglobal is leading the development of
  industry-driven standards for the Electronic
  Product Code (EPC) to support the use of Radio
  Frequency Identification (RFID)
• http//www.autoidlabs.org/index.html
• Auto-ID Labs is a federation of research
  universities that has evolved from the Auto-ID
  Center, initially founded in 1999 to develop an
  open standard architecture for creating a
  seamless global network of physical objects
• http//rfidjournal.com/
• RFID Journal is an independent media company
  devoted solely to radio frequency identification
  and its many business applications
• Their mission to help companies use RFID
  technology to improve the way they do business

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Vendors

• http//www.matrics.com
• http//www.ti.com/tiris/default.htm
• http//www.rfid.zebra.com/index.htm
• http//www.alientechnology.com/
• Just Google for EPC, RFID Tags
• and enjoy the ride
• Not an official endorsement by DTI of any of the
  vendors listed, rather a place to start you
  research

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Questions?