Knowledge deficit holds back RFID takeoff

RFID     FROST & SULLIVAN

Asia - Industry players need to show off best practices and engage in educating end users on the benefits of RFID before real adoption can take place, especially in Asia, said Frost & Sullivan.

In a new analysis, RFID Practices and Learnings, Frost & Sullivan found that new entrants to the industry are not adequately aware of its dynamics, especially in Asia where it is still in the early phases of growth.

The study also found that industry participants' efforts have been catalysed by end users' growing awareness about the technology's potential benefits and private sector's acknowledgement of RFID as a solution to inefficiencies resulting from a lack of visibility. These are helping to turn the hype preceding RFID into real business cases.

RFID adoption has also gained traction in countries where there is government, the study said.

"Governments in South Korea, Japan, Australia, Singapore, Thailand, and Malaysia are sparing no efforts to promote RFID in various sectors including animal tagging, aviation (baggage tracking), and supply-chain based applications," says Frost & Sullivan research analyst Richard Sebastian. "The governments' initiatives are not only meant to improve the overall efficiency and security in industries but also tag the technology as a vital cog in their countries' development."

Problems to adoption

The industry however is still grappling with age-old problems like calculating the total cost of ownership and making the technology out of bounds for numerous end-user segments.

While there have been general price declines, a full-scale deployment is still unaffordable to many small-and medium-scale enterprises (SMEs). In this case, RFID stakeholders need to continue focusing on innovation to ensure the technology not only performs better but also becomes more affordable over time, Frost & Sullivan said.

In addition to this, RFID vendors need to step up efforts to educate end users about the benefits of the technology, both tangible and intangible.

"Companies intending to leverage RFID's potential need to analyse the market situation and do a thorough cost-benefit and return on investment (ROI) analysis to verify if they can reap significant savings," said Sebastian.

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