What if RFID Hardware Were Free?

According to a May 11 article at the Japanese business news site Nikkei.com (registration and paid subscription required; free trial period available) NEC Corp. plans to start taking orders in July for new RFID tag reader/writers. The new systems will be compatible with all major worldwide radio communications standards, and priced at less than 10 percent of today's prices for comparable systems, according to “company sources,” Nikkei.com said.

Unspecified improvements in semiconductor design and manufacturing techniques enable NEC to sell its new reader/writers for approximately 10,000 yen (or just over US$100 at current exchange rates) each for orders of 10,000 units or more. Further, NEC “has developed servers and software that can read and write several tens of thousands of pieces of data per second, which it will lease to clients using RFID tags,” Nikkei.com reported.

“The company aims to generate 100 billion yen in sales within the next five years by selling the reader/writer and leasing servers and software,” according to the Nikkei.com article. The report adds that NEC plans to focus on growing RFID use beyond traditional supply chain and asset-tracking applications, particularly in the retail sector.

Two reactions.

Reaction One: Nice innovation chops, NEC (assuming that the reports from the usually reliable Nikkei Group are accurate, of course).

Reaction Two: So what?

Cheaper tags, readers and writers and bigger, faster read volumes can only go so far. (This is a lesson being learned by many RFID vendors even as you read this. And that includes at least some of those pursuing the “RFID as a service” go-to-market approach, where they own and manage the infrastructure and users pay monthly usage fees.) The savvy users and vendors I've worked with agree about what's really needed to make RFID a truly significant, sustainable, mainstream set of technologies. Herewith, a summary.

Affordability – of the whole solution, not just the hardware, and especially including interoperability and integration (about which more just after the next item).

Reliability – as defined and measured by users' business requirements and not just any particular vendor's particular silo.

Interoperability – of solutions with one another and with incumbent IT solutions and relevant processes and operations, as well as “fork-lift-free” integration of all relevant data, technologies, and operations.

Scalability of all solutions – both up and down.

Economic stability and transparency of all vendors and partners involved in the user's value chain – and an easy, low-cost exit strategy, should a particular vendor or technology go away or cease being appropriate for any reason.

Even if hardware and software were free and infinitely capacious, unanswered questions about the other above issues would still keep many users away from RFID (and other potentially critical and transformational technologies, such as SaaS and cloud computing). And this is as it should be.

Users, in fact, should treat the above considerations as a bare-bones version of a “bill of rights” they deserve to have upheld by every vendor hoping to do business with them. And vendors should consider them the minimum buy-in required to gain and keep users' business and trust. Because it's each user's business that lives, dies, or thrives by how well solutions such as RFID actually work to improve agility, competitiveness, and profitability. And helping more users thrive is how technology-centric markets such as that for RFID are grown and sustained.

So whether user or vendor, you and your colleagues should “ARISE” (it's not just an acronym – it's a mnemonic!) and support the above goals, altruistically, pragmatically, cynically, or otherwise. Whatever your reasons, the effects will be a stronger, more vibrant market and more solutions that actually deliver benefit and value – and that actually sell.

Not that I have any strong feelings about these things, you understand...