RFID drivers 2008

"RFID has the potential to transform business operations and to offer significant business advantages, but more pilots and trials have been made public than full-scale implementations," observes ABI research director Michael Liard. "It is an important distinction,because some organizations keep quieter about their RFID work to gain a competitive edge."

But pilots are necessary growing pains of any "maturing" market, and organizations see the overall benefits of conducting RFID pilots, along with the subsequent implementation.

Even as RFID is maturing, Liard feels RFID has not yet reached the so-called tipping point. "The industry is still working its way there," he tells Packaging World, "though it may come in the next two years. It’s still the initial efforts from companies like Procter & Gamble, Unilever, Wal-Mart, Tesco, and Metro that are helping push this market towards the tipping point."

Liard suggests that companies are welcoming RFID as an integral part of business processes and operations. "What began as pilots have now progressed into wider implementations," he says. "End users told us that RFID technology reliability—and the business case—can often trump cost as the leading consideration in RFID technology selection."

That said, Liard points to factors dragging on wider implementation in packaging-related RFID. One is that some packagers are still questioning RFID’s value by asking: What’s in it for me?

"There’s a need for retailers to provide better ‘messaging’ of how the RFID data is going to be leveraged and shared among trading partners," Liard points out.

Another factor is the use of 2-D bar code symbology as an alternative automatic data capture technology, including to meet e-pedigree requirements. "Also in pharmaceuticals, there’s still a question regarding what frequency to use—UHF or HF—along with continued discussions of data sharing," Liard adds.

"Undeniably," concludes Liard, "the market has big plans for RFID. Its use is expanding rapidly with expectations of significantly greater growth and high-volume applications."