The Wall Street Journal is throwing off mixed signals regarding RFIDs. On 30 October, it excoriated the technology, placing it under a “Beware Hot Tech” banner. Yesterday, a mere 9 days later, the paper ran a long article, “After Being Overhyped, RFID Starts to Deliver.”
RFIDs, which are essentially small sensors embedded in or placed on goods or shipping cartons and containers, were supposed to be tracking all sorts of goods, and sometimes people, by now. So the first article cited the fact that fewer, logistics providers are testing or planning to use RFIDs than the year before, according to a Northeastern University survey. As well, in the tests that companies are doing, the technology is not robust enough—95 percent accuracy, instead of 99.9 percent, according to a VP at Penske Corp. The tags themselves are still too expensive – 20 cents instead of 5.
The second article cites some other disappointing stats in the marketplace, such as the fact that the RFID market was about $2.5 billion in 2006, and only growing about 15 percent per year, far short of a 2002 Frost and Sullivan analyst prediction of a $7.25 billion market by 2008. It noted that WalMart withdrew a requirement it tried to impose on suppliers to start using RFID tags.
Such surveys and market analyses are best taken with enough salt to toss back a case of tequila, though, and the second article cited a number of encouraging signs. An influx of venture capital in 2002-2005 led to maturing companies with maturing technologies, even if the market for them is less than predicted. Essentially, what has happened is the WalMart initiative, and similar smaller ones from companies like Proctor & Gamble, spurred a bunch of investment, research, and inflated market predictions. In withdrawing the initiative, some of the air went out of the RFID tires, which WalMart had overinflated in the first place.
Meanwhile, as the second article notes, RFIDs are being quietly used on “campuses, airports, prisons, semiconductor companies, and jet-engine manufacturers.” Spectrum discussed RFIDs as the centerpiece of an award-winning special report, “Sensor Nation,” in July 2004. One particular article, “Sensors and Sensibility,” said about RFIDs, “It’s alarming! It's no big deal! How your personal information is being collected and protected, used and misused.”
This past March, we returned to the topic in a big way. In “Hands On,” Amal Graafstra, an entrepreneur and geek based in Bellingham, Wash., described his experiences “chipping” himself—inserting glass-enclosed RFID tags into his hands in order to keylessly unlock his car and the front door of his house.
Meanwhile, two other authors, Kenneth R. Foster and Jan Jaeger, examined “The murky ethics of implanted chips,” and a blog entry described the useful, if grim process of using RFIDs to track corpses after Hurricane Katrina.
The idea of wirelessly and automatically tracking everything from shipping containers to razor blades, and people, incarcerated or free, living or dead, is inevitable. Like solar energy, RFIDs will succeed as a technology and a market, whether it takes 5 years or 25, and whether individual companies make or save money today with them. The Wall Street Journal is, of course, obsessed with the latter issue, but it’s the former one that’s important to technologists.
