Smart tag set to outstrip humble barcode

Radio frequency identification has had a long development curve but IBM in Ireland believes its moment has come, writes Karlin Lillington.

In a step that indicates a growing area of Irish expertise in radio frequency identification (RFID), IBM officially opened the doors of a new research and development (R&D) centre for RFID technology in Dublin this week.

Located at the IBM campus in Mulhuddart, the Wireless and RFID centre of excellence is one of only 10 worldwide and just two in Europe - the other, in La Gaude, France, focuses on showcasing the business benefits of RFID technology. According to Jennifer Van Cise, IBM Dublin campus director, the Dublin facility, with 20 to 25 employees, is IBM's largest RFID facility.

She says it will not only be able to draw on expertise among IBM's 3,200 Irish employees for R&D as well as services and support, but will have an ongoing relationship with Irish universities and business partners such as Intel.

In December, Intel expressed a strong interest in developing and promoting Irish research into RFID, noting a broad but scattered base of national expertise in the area.

RFID is seen as a cutting edge technology but actually has had a long development trajectory. First used by the Americans in the second World War to label bombs, RFID has had to wait for the development of sophisticated computer networks and databases and more sensitive and flexible hardware to take off.

Curiously, RFID has been around even longer than its rival identification technology, barcodes, which were developed in the 1950s but little used until the mid-1970s.

The ubiquitous striped barcode is already encountering problems, as the barcodes must grow ever wider to keep offering unique numbers to the things they identify.

A three dimensional barcode allows more information to be associated with an item and is seen as a bridging technology before RFID replaces barcodes altogether, but the two forms of identification are expected to co-exist for a decade or more yet, according to Colm Shorten, IBM's campus RFID manager. However, he is confident RFID will gradually supercede less versatile barcodes.

Why? Because RFID enables so many other practical applications and dovetails with computer networks in a way barcodes can't, says Sebastian Taylor, IBM RFID solution leader, North/East Europe. RFID is a major development area for IBM, he notes, with $255 million (€210.77 million) invested in the area in 2005 alone. Though over-hyped about three years ago before the technology could deliver, it is coming into its own now, he says.

Mr Taylor looks at the evolution of barcodes for a glimpse of what is likely to happen with RFID tags - prices for hardware and software dropped far more rapidly than had been predicted in the 1970s, which made barcodes cheap and easy to use. The net benefit of using barcodes has been estimated at six times the original analyst predictions in the 1970s, he notes.

Costs and fine-tuning the technologies are an inhibiting factor right now for RFID growth, he acknowledges, with the cost of an individual RFID tag around 15 to 20 US cents now.

When the volume of usage grows, this is predicted to drop quickly to about five cents and a longer timeline pegs them at one cent in under a decade.

Early adopters using RFID tags in trials have seen some very positive results, he says. For example, the Metro group of supermarkets in Europe found the tags helped increase processing efficiency by 17 per cent, reduced theft and loss by 18 per cent, and out of stock situations by up to 14 per cent.

Electronics manufacturer Philips found it could ship electronics a full day faster using RFID tags - a significant gain for that tight-margin sector. In Stockholm, the tags are used to assess congestion charges on vehicles entering the city centre.

IBM has been trialing an asset-management project in Mulhuddart where a set of laptops have been tagged to track their movement around the large seven-building campus, says Shorten. It has been so successful that the company plans to roll it out widely across the site and probably across other IBM facilities worldwide.

And in their new RFID centre, the company demonstrates projects that can track employees (in use on an oil rig, as a safety measure), identify items in a warehouse, scan a shopping bag of items without needing to go through a conventional checkout, and track medications in a hospital.

Mr Taylor says the sectors leading the push towards RFID adoption include transport and logistics.

"Every major transport group is piloting some sort of RFID project now," he says, in addition to healthcare.

New Government regulations requiring the careful tracking of pharmaceuticals and the ability to locate and manage costly assets and find key employees such as emergency doctors within a building make RFID attractive to the healthcare sector, he says.

The middleware and services that support the management of data coming from the tags is critical, according to IBM, and that is the focus of the Dublin RFID centre.

"It's one thing to read all that data with the hardware, but another to have a context for that data," says Mr Taylor.

IBM Ireland is positive the centre has scope for significant expansion in the future.

"We do see it as having growth potential. On a personal level, I'd love to see it quadruple. I certainly expect it will grow," says Shorten.