Data Monday: RFID (enabling the Internet of things)

by Luke Wroblewski December 6, 2009

RFID (radio-frequency identification) tags are tiny chips that label objects with unique identities. They hold more data than standard bar codes and can be read from a dozen feet away. As rumors of an RFID-reader enabled iPhone keep swirling, it's interesting to see where the RFID market stands today and how the tags are being used now.

  • Bar codes on objects account for over five billion scans per day. Since their inception (in 1975) bar codes have amounted to a quiet revolution by enabling accurate inventories, market analysis, reducing human error, and automating the recording of objects. But being made of paper, bar codes are too slow and too limited (they only spell out a company and product name) to keep pace with today’s digital economy. The next generation of codes is electronic. (source)
  • An electronic identity code is the foundation for an “internet of things”. It can communicate identity not only at a product level, but at an object level as well. Not only can it store identity it can announce it. Our electronic code du jour is RFID (radio frequency ID). An RFID tag consists of a tiny radio and computer. (source)
  • Local positioning systems on the ground can track the coordinates of RFID tags and store a history of where they are and what they are doing. Global positioning systems allow that information to be read anywhere. (source)
  • Sales of RFID tags, readers, software, and services will reach $5.56 billion this year, up from $1.9 billion in 2005. (source)
  • Ultra-high-frequency tags still run more than 7 cents apiece. (source)
  • RFID tags for pallets and cases of retail goods accounted for just 10% of about 2 billion RFID tags sold worldwide in 2008. (source)
  • The biggest use of RFID is smart cards, a $3 billion market that consumed 559 million tags last year, or 28% of all tags sold. Most of these smart card projects are for passports, ID cards, and prepaid transportation cards. (source)
  • The retail industry, with a total consumption of 468 million RFID tags last year is short of the revolution some projected but proponents note it took decades for bar codes to become standard practice. (source)
  • In 2008, 130 million RFID tags were sold to track apparel. Sales (at American Apparel stores) with the RFID systems are 14% higher on average than those without RFID systems. Staff levels at those stores are 20% to 30% lower. (source)