Radio frequency identification

10 February 2006

A primer on the technologies that use radio waves to automatically identify individual items.

What the experts think

"Every pill in every bottle will be talking to the bottle, and every bottle will be talking to the medicine cabinet."
Nicholas Negroponte, visionary and author

"Theft will be drastically reduced. Items will report when they are stolen, [with] their smart tags also serving as a homing device."
MIT's Auto-ID Center

"Tagging technology will probably destroy the insurance industry."
Peter Cochrane, head of Concept Labs and former BT Chief Technology Officer

"The possibilities with RFID are endless."
Colin Cobain, IT Director, Tesco

RFID tags are not exactly new: they have been attached to valuable in-store goods for years to prevent theft, and pets are often tagged with small RFID devices. But miniaturisation, standardisation and better networking and database technologies have opened up new possibilities.

The simplest tags act like invisible barcodes, enabling any item to be automatically identified within a given range. Others have built-in rewritable memory and sensors.

Glover Ferguson, chief technology officer of Accenture, is an RFID evangelist. He talks of supermarkets where, because every item is tagged, there will be no need for checkouts; of food bearing tags that change colour when the product is no longer fresh; of aeroplane wings that don't need to be x-rayed, because embedded tags cry out "we're stressed".

Ultimately, virtually every man-made object in the physical world, according to Ferguson, will be tagged and linked to a "virtual double", a data object that can be managed electronically.

Challenges that slow adoption

1. Information handling. For some of the more sophisticated applications, millions or even billions of devices will have an electronic identity. That could mean lots of data, lots of networking and lots of complicated database issues.

2. Miniaturisation. Tags are down to the size of a half-penny. But for many applications, that is still too big.

3. Privacy. Consumer rights organisations are worried that it is getting too easy to track people and their purchases.

4. Price. Prices are falling, but unless the numbers involved are huge, tags are likely to cost more than 25p per item. Smarter ones cost more. And while basic RFID readers are cheap, big, integrated, high-speed systems can cost hundreds of thousands of dollars.

5. Standards. RFID would be adopted more widely if everyone used the same or interoperable systems for numbering and tracking products. Proposals for a universal Electronic Product Code (ePC) have been put forward.

"I'll grow a beard!"

The use of RFID tags has sparked privacy concerns, especially in the US. Groups such as the Electronic Frontier Foundation believe that too much personal information is already being collected by businesses, and that RFID makes that task easier.

One example, cited in RFID Journal, suggests that when a customer buys a tagged sweater using their store card, the store will know who they are, where they live, and their purchasing history as soon as they return to that store wearing the sweater.

Gillette's decision to buy half a billion tags, and the trialling of 'smart shelves' in some supermarkets, has led to threats of a consumer boycott. "I'll grow a beard," said one protester.

Market trends

The RFID market has grown slowly for 40 years. Now it is exploding. Analysts put RFID sales at around $700 million in 1998, rising to just under a $1 billion in 2000. A Venture Development report forecasts that sales in 2005 will be $2.6 billion. But sales figures do not necessarily include all the back-end networking and processing that may be required.

How it works: get the frequency

RFID systems are simple. A transceiver, or radio transmitter/receiver, emits a radio signal, which activates each tag and powers its circuitry. This then emits a signal that can be read back by the transceiver. The data is then linked to a database, where information about the item tagged is held. For example, it may identify the item and record that has just been paid for.

Active tags contain a battery and their own rewriteable memory. They may also have sensors - for example, they may be able to electronically 'smell' if food is still fresh, or if the temperature has been maintained at a set level.

The radio range of the readers, and the amount of information they can deal with, depends on power and frequency. Simple systems - such as the tagging of pets - use low-cost, low-frequency transceivers; but to track thousands of items leaving a supermarket, for example, an expensive, high-frequency transceiver will be needed.

The more items that are tracked, and the more closely or frequently they are tracked, the greater the information handling challenge. Systems integrators are increasingly integrating RFID with exception handling systems, where only exceptions or deviations from the norm trigger actions. This can help reduce complexity. Another design principle for RFID systems is to store data locally where possible.

Taganomics

RFID is sometimes described as a very expensive form of bar-coding. But even with tags priced at between 10p and 50p a time, and going up to £30 a time, and readers usually starting at £500, many companies still find it worthwhile. Goods can be accurately tracked, data collection costs drop, and theft is reduced dramatically. Procter & Gamble in the US hopes that by tagging its products, it can cut inventory by 40%, thus saving $1.5 billion.

RFID systems are noncontact, and non-line-of-sight. That means items can be read without opening a box, or even slowing. Items can also be detected even if hidden. For this reason, suppliers tend to position RFID as a complement to, not a replacement for, bar codes.

RFID in practice

RFID technology has been used since the Second World War. It is now being enthusiastically embraced on a much wider scale by retailers and manufacturers.

Gillette, for example, is trialling the technology by tagging Mach3 razor blades - it has provisionally ordered half a billion tags. Supermarket chain Tesco will try out Gillette's tags in the UK. Trials are also underway for whole "smart shelves" to monitor inventory and consumer behaviour.

Marks &Spencer is planning to tag some 3.5 food trays, so that it can track deliveries from suppliers. Woolworths is also using RFID to track boxes of goods through the supply chain, reducing so called 'inventory shrinkage'.

Nokia has begun to tag all its mobile phones, so that they can be monitored through the supply chain, and so that stolen phones can be tracked.

The US Department of Defense is using RFID tags to track military equipment and supplies in the Persian Gulf.

Michelin, the tyre maker, recently announced an 18-month trial to embed specially designed RFID tags in its tyres. This will enable car manufacturers to track their use in the supply chain and also how motorists use them.

Prada, the Italian fashion house, has put RFID tags on every item in its New York Epicenter store to automatically identify customers and merchandise and provide individual shoppers with personalised information about their selections before and after they make a purchase.

US-based Marathon Oil has invested in RFID readers and tags that will allow it to activate tools in oil and gas wells remotely, saving millions of dollars a year.

Bank of America was the first financial institution in the United States to test an RFID bank card, called QuickWave. The card is smaller than an average credit card and can be carried on a key chain. Users can then use it at participating outlets, for example fast-food restaurants, to pay for transactions of less than $20.

Information Age: News, analysis & insight for IT & business leaders