World Looks for North America for RFID for Strength, Firm Says

Online staff -- Electronic News, 1/9/2006

RFID was one of the hot technologies of last year and shows every sign of maintaining that status this year, according to Oyster Bay, N.Y.-based market research firm ABI Research.

In a market already experiencing rapid growth, the firm believes the RFID market is becoming increasingly global, but the U.S. 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 U.S. working to establish footholds and strengthen their presences in North America. Hailing mostly from Japan, South Korea and Europe, they include companies such as Sato, KSW Microtec, Rafsec, Siemens, Omron and Samsung, and they are refining their channel strategies for the region, the firm noted.

The refining of channel strategies is seen as a good thing says ABI Research's director of RFID and ubiquitous networks, Erik Michielsen, in a statement. “Increased competition, and the infusion of international perspectives, will have a beneficial effect on the markets.”

This year, EPCglobal will try to play a role in determining reader/network interface standards, the firm continued, however 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, or whether this is something that will benefit the industry in general. ABI Research has an open mind on that issue,” Michielsen added.

Finally, ABI says this is 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 that 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, the firm concluded.