Expert predicts lucrative future for RFID smart labels
RFID smart label technology in order to take advantage of an
emerging market that will prove highly lucrative in the future,
writes Anthony Fletcher.
"Much of the attention up until now has been largely focused on RFID solutions for pallet labelling and how the industry can meet the new demands of major retail groups such as Walmart, Tesco or Metro," said Labelexpo strategic development director Mike Fairley.
"But barcode pallet and logistics labels are only produced by a relatively small number of the 15,000 or so self-adhesive label converters that are to be found around the world - perhaps less than a couple of hundred at present."
Fairley believes that the thousands of companies involved in the printing of prime product or item-level labelling should pay close attention to the forecast future growth of RFID smart labels, which are set to become a key part of the label industry in the future.
"Pallet level RFID labels, product and item-level RFID labels, printed RFID technology all hold a future for the label converter prepared to understand and invest in tomorrow's RFID label world," claimed Fairley.
"Fall behind in this new RFID-enabled world and the label converter may well see part of his business disappear to a more enlightened competitor in the years to come. It is a challenge that needs to be addressed today - or certainly in the near future."
In simple terms, an RFID smart label is made up of an integrated circuit (IC) chip, a carrier substrate and an antenna - all incorporated into a pressure-sensitive labelstock. Where the IC chip, carrier and antenna are pre-prepared and supplied to the labelstocks manufacturer or printer/converter they are in the form of an inlet or inlay, which must then be inserted into the pressure-sensitive web to make the RFID smart labelstock.
This can be done before printing, after printing, in-line, off-line, at the point of application. There are a number of possible options. Some key international retail groups are indicating that they will commence product (item) level tagging of added value items and packs later in 2005. More such companies are expected to follow in the coming months.
Fairley believes that rather than add even more labels to such items, a far better solution is for label converters to produce high quality black-and-white or even colour-printed product labels that incorporate RFID tags.
However, there is growing opposition to the unchecked proliferation of RFID technology to everyday purchasable items. CASPIAN (Consumers Against Supermarket Privacy Invasion and Numbering) for example launched a worldwide boycott of Tesco earlier this year in response to the retailer's escalating use of RFID on consumer products.
A major concern is that the RFID chip could result in every product on earth having its own unique ID. The use of unique ID numbers could lead to the creation of a global item registration system in which every physical object is identified and linked to its purchaser or owner at the point of sale or transfer.
However, the trend towards item-level RFID smart tags seems inexorable. According to Fairley, current industry forecasts are estimating a requirement for more than 1,000 billion RFID tags by 2015, of which some 99.5 per cent will be in the form of labels and around 95 per cent of those as product or item level labels.
Such label volumes will almost certainly impinge on thousands of label converters, particularly those involved in product labelling of higher-added-value products such as wines and spirits. Companies such as Avery Dennison, Tamarak, Domino and AB are currently working to find the best solution for quality and quantity RFID smart labels for both pallet level and item level labels.
Tarsus, in association with IDTechEx, is holding an event during Smart Labels USA 2005 to help label converters understand the new item level RFID market. The event runs from 27 to 30 June 2005 in Baltimore.
