SCDigest Editorial Staff

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The pilot project among several manufacturers and retailers to tag DVDs is from one perspective plodding along, despite what appear to be major potential benefits in the product category with unique inventory management challenges. What Do You Say? Click Here to Send Us Your Comments Click Here to See Reader Feedback

In a market that at one level still seems relatively new, it may be surprising to think of the RFID industry as “maturing,” but that’s the take of the research analysts at Robert W. Baird & Co., an investment company that follows the RFID industry closely.

In the most recent edition of its RFID Monthly publication, the Baird researchers say that they “expect that the large number of players in the RFID industry will begin to see numbers decline in the next 6-18 months as the RFID market(s) gain greater maturity. We are seeing the mention of industry consolidation increase in frequency, and we agree that the broader RFID market is oversaturated with companies.”

Part of this “over-saturation” of technology providers, of course, stems from the fact that RFID adoption remains below once aggressive projections, with many pilot efforts having a hard time getting to that next level of rollout, despite evidence of strong ROI in many applications.

As just one example, the pilot project among several manufacturers and retailers to tag DVDs is, from one perspective, plodding along, despite what appear to be major potential benefits in the product category with unique inventory management challenges.

Baird says that the consolidation and acquisitions will result from the RFID market becoming increasingly segmented and well-defined, with different vendors staking out claims to specific product categories and niches. In the “passive” RFID market, that means larger or more aggressive players may seek acquisitions to fill product holes within that product segmentation structure and to gain scale in terms of costs and total solution footprint.

Baird cites Sirit’s planned acquisition of RSI ID Technologies as an example of this type of consolidation. The move would combine Sirit's readers and other hardware, including active and passive tags, with RSI's capabilities in antenna and inlay design to offer more complete solutions.

On the “active” RFID side, Baird expects consolidation between traditional real-time location system vendors and those using the newer “Ultra Wideband” asset tracking technology, increasingly common in hospitals and some other applications.

(RFID and Automatic Identification Article - Continued Below)