World News: RFID market to reach $7.07bn this year

World News:  RFID market to reach $7.07bn this year

Active RFID will account for more than a quarter of the total RFID market this year, according to research by UK consultancy, IDTechEx.

The RFID market is forecast to reach $7.07 billion this year, plus $0.44 billion if you include the market for cell phone RFID modules.

Factors driving growth include Real-Time Location Systems (RTLS), and ubiquitous RFID sensor systems (mainly disposable), including those in the form of Smart Active Labels (SALs). Conventional active RFID used where passive solutions are inadequate and RFID modules for mobile phones will make up the rest.

The rapid growth of the active RFID market is driven by, among other things, strong market demand for tracking, locating and monitoring assets and people; a reduction in the cost and size of the tags and systems; the development of Ubiquitous Sensor Networks (USN); the availability of open standards – notably ISO 18000-7, IEEE 802.15.4 and NFC; and the leveraging of many popular forms of short range wireless communication, particularly WiFi, UWB and ZigBee and including mesh networks.

We have come to the end of a decade of active RFID – large tags in systems always generating their own radio waves usually in the 305-433 MHz range. By the beginning of 2007, 614 million active RFID tags had been sold, the vast majority of which are used for car clickers (593 million). Like these, a large percentage of active RFID tags sold in future will replace nothing – they will perform new functions.

The second biggest use for active RFID has been by the military, with 6.3 million active RFID tags in use to date.

In 2007, almost two-thirds of the spend on active RFID will be on the system (reader, network, installation, software), as opposed to the tags themselves. This changes as the number of tags per application increases, and by 2017 the spend on everything other than tags will be 57.3%.

With more than 100 companies now involved in some part of the active RFID value chain, and considerable government financing of research on low cost active RFID, unit prices will drop. The price erosion will drop even more rapidly with the emergence of new technologies, such as new microbatteries and printed logic.

For the next ten years, RTLS will dominate the spend on tags. Mobile phone modules will see considerable price erosion as they are increasingly incorporated into the phone circuitry and volumes increase; NTTDoCoMo has already shipped more than 29 million cell-phones with RFID modules.

In IDTechEx’ analysis of 75 active RFID case studies from eighteen countries, the largest number of projects has been in the logistics industry, with around double the number for each of the nearest contenders – the air industry, automotive/transportation and healthcare.

The case studies show that the tagged items were mainly containers, followed by vehicles, conveyances and people.

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