White PapersRFID can provide information about raw materials, manufacturing conditions, distribution processes, and even demand as items move off the shelves. Currently, the majority of focus is at the palette, or case-level, while individual RFID tagging is reserved for more expensive items. Some companies are even experimenting with RFID payments, adding "swipeless/signatureless", networked, point-of-service terminals to help speed up purchases. Businesses using RFID will require applications that can collect and manage massive data flows. It may be more cost-effective to build these elements into the network. In response, providers are offering assessment, design, implementation, and end-to-end managed RFID services.
Radio Frequency Identification A Business Revolution Providing Strategic and Competitive AdvantagePoint of ViewThe Technology Radio Frequency Identification (RFID) is a wireless data collectiontechnology developed during World War II that has been used intracking and accessing applications for about a decade. Thetechnology transfers data wirelessly between a tiny transceiver and atag. A tag is a combination of an electronic transponder with anantenna that can be attached to items such as a razor blade, aninfusion pump in a hospital, a bottle of soda or a military tank. Whenthe tag comes within the range of the transceiver, anywhere frominches to nearly three hundred feet, the transceiver decodes theinformation electronically programmed on the tag. Advances andstandardization in the protocol, tags and RFID readers have broughtscale and prices to the point where use of the technology for assettracking and location services is feasible. Tags include extremely small microchips that are about the size of apepper flake. However, the required antenna makes the tag about 1squareinch. The microchips listen for a radio query sent out by aRFID transceiver. The chips then respond via a defined protocol bytransmitting their stored, unique identification code through theantenna. The transceiver receives the data and decodes the signals.Transceivers are usually integrated into handheld terminals. They canalso be part of readers fixed to a door or wall in a facility, or evenintegrated into Wi-Fi access points. The data collected by the readersare sent over a network, either wired or wireless, to host computersystems. These systems could be in the same building or locatedaround the world.Frequency RangesRFID technologies currently in use today generally fall into one of fourradio frequency ranges: "Low Frequency Devices (125-134 kHz) areuseful for limited rangeapplications, such as animal identification and where metal itemsaretagged (such as in warehouses)"High Frequency Devices (13.56 MHz) would be used in environmentswhere moisture might be present High Frequency Devices are used today for airline baggagetracking and building access control applications These devices do not work well with metal"Devices that Operate in the UHF Range (868-928 MHz) may beuseful for pallet and container tracking and have a longer read-range of over 1.5 meters "Devices that Operate in the Wi-Fi Range (2.4 GHz) are useful forlonger read-range needs and are gaining wide acceptance withhealthcare providers for critical asset trackingKeyPoints" RFID technology has been in use for many years, but is finding a mass-market application in supply chainsystems. Mandates to suppliers from large retail firms and the government are accelerating adoption.Standardization, which is occurring within theEPCglobal organization, is also influencing RFID use."Technical and standards issues need to be addressed.However, sufficient progress has been made so thatthereshouldbe widespread use of RFID for supplychain applications within 2008-2009."Most supply chain applications have been at the palletlevel. Costs, operational issues and privacy concernshave limited testing at the product level. Ensuring thetechnology benefits accrue to the end customer couldalleviatesome concerns (i.e., receipt and warrantyverification).Untitled DocumentPoint of View - Radio Frequency Identification__________________________________________________________________________________________________2Types of TagsThere are two varieties of tags: active and passive. Passive RFID tags have no batteries. They are low-power devices that derive powerfrom the initial radio signal sent by the transceiver to transmit theirresponse. Active tags contain their own battery source and are alwayson. They will periodically transmit a signal so data can be captured bytransceivers located in a factory, warehouse or other location.Tags can be read-only or read-write. On the read-write tags, data such as a serial number are permanently stored and memory is leftavailable for later additions or changes.The cost of passive RFID tags based on EPCglobal (the ElectronicProduct Code network s U.S. organization) developed industrystandards is continuing to drop in price. These passive tags can nowbe acquired for about 10 cents in quantities of a million or more.Active tag prices are dependent on the capabilities within the deviceand can cost anywhere from 10 to over 100 each. As the price of the tags continues to drop, many more items will betagged. In the next few years, if tag prices reach a penny or under,lower-priced items such as toothpaste, shampoo and boxed cerealmight also be tagged.Market UseRFID is currently used in airport luggage-routing systems, clothingtagging systems, asset tracking, asset management, homelandsecurity, patent tracking, cattle tracking, pet tracking, inventory control areas, pharmaceutical supply chain (pedigree, anti-fraud),library checkout systems and highway toll collections. It is even used to track attendees at the Oscars. The retail and manufacturedgoods industries are also very interested in the technology for supply chain management applications. There are possible applications for use of RFID technology in the entirerange of a product s lifecycle. RFID can be used to provide informationabout the raw materials and manufacturing conditions of a product.The technology can track where the product is during the productionand distribution process. It can also be used to track the demand for aproduct as it moves off the shelf and can be used to continue to trackinformation about the product after it leaves the store. AT&T placesRFID tags on network assets for enhanced asset tracking andmaintenance management.For now, the majority of focus is at the palette, or case-level, with RFID tagging of individual items used only on more expensive items(CDs/DVDs, pets). A major retail firm recently asked its top 300suppliers to place RFID tags with electronic product code informationon each case and pallet shipped to its distribution centers. A U.S.Government agency has released a policy requiring suppliers to putpassive RFID tags on each individual case of pallet packaging. Other applications for RFID are being used to improve assetmanagement or to speed up supply chain processes. One company is using RFID tagging to keep track of its expensive beer kegs. Anotherbusiness is using tagging in its refrigerated food supply chain to speed up tracking of perishable food items on track dollies and roll cages.AT&T has worked with multiple clients in implementing RFID to help improve business processes and enhance productivity. The technology is also used to more effectively manage logistics, manageshelf-level inventory, real-time data collection of shopper behavior and tracking the location and movement of goods shipments. Somecompanies are experimenting with RFID payments. This particularapplication is now being widely deployed, as many credit cardcompanies are issuing millions of RFID enabled credit cards each year.Merchants are adding the new swipeless/signatureless networkedPOS terminals to their stores so that clients can speed up theirpurchases and use their cards even for small ticket items (under 5).AT&T has deployed an RFID enabled swipeless/signatureless RFID POS service in its cafeteria to accelerate checkout. Privacy and Security are top of mind concerns with major retailers,consumer groups and the RFID industry. Several industry associationstudy groups are working together to understand how to addressthese important points.Technical and Standards Issues There are still technical difficulties to be overcome, even at thepallet/case level. Early adopters have experienced growing painstypical of a nascent technology. Problems developed using tags atcertain frequencies with liquid products or when merchandise comesin metal cans. In addition, conveyor belts emit a form of white noisethat may sometimes mask or scramble RFID transmissions. There areissues regarding scanning range, coverage, interference, durability,accuracy and equipment speed that still need to be addressed. Thereare also problems to be solved integrating the technology with othersupply chain systems. Additional standards issues will also need to beaddressed. Innovative companies are responding to these issues as partof the EPCglobal effort to infuse the supply chain with RFID capability.Getting smaller companies compliant with the RFID initiatives of majorcompanies is the current focus of the service providers who supportRFID. The EPCglobal standard tag, class 1, generation 2 tag, isassisting by having defined standards that make RFID much morereliable and efficient for supply chain applications.Implications for TelecommunicationsWithin the four walls of the factory or distribution center, both thewired LAN infrastructure and the wireless LAN are used to connect the transceivers that are collecting information from the RFID tags withcentralized data repositories. As applications move up the supplychain and link the manufacturer s warehouse to a logistics provider,or a shipper to a retailer s distribution center, data is likely to betransmitted over a private or protected wide area network. Over time, the entire supply chain could be connected from the plant to the retailfloor and data would be exchanged in both directions within a myriadof networks (both wired and wireless). This will enable the securedsharing of appropriate, selected information with global supply chainsuppliers/vendors. Untitled DocumentPoint of View- Radio Frequency Identification__________________________________________________________________________________________________3For moreinformation on AT&T s Networking Exchange,visit www.att.com/networkingexchange.The information flow within this environment will be heavy in the upstream direction, flowing from the edge of the corporate networkto centralized sites, such as distribution centers and the corporateheadquarters. In order to make use of data on an object s RFID tag,data describing it must be housed in databases that processing sites(connected to a set of readers) are able to access. It is expected thatpoint-of-sale systems, for example, will need to process up to tenscans per second, per reader, and keep track of scores of individualitems at once. Businesses will need to architect their networks so theycan efficiently handle this massive flow of logistics and inventoryinformation. They will need also to architect storage and informationdistribution systems to enable the data to be used from central as wellas remote locations.Businesses will require applications that can collect and manage thedata resulting from RFID-based applications. Massive data flows willneed to be aggregated and transmitted to centralized locations foranalysis and storage. It may be more cost-effective to build elementsof data management, security and storage into the network. Somefunctions for applications using RFID technology could also be builtintobar-code scanners, Wi-Fiaccess points, cell phones or othernetworked devices.During this time of growth, telecommunications and hosting managedservice providers like AT&T have taken the opportunity to use theirexpertise regarding the network implications of RFID applications tohelp clients implement scaleable and secure RFID solutions. WhyUse a Managed ServiceProviderEnterprise customers indicate that they don t want to have to certifytheir own technologies. They don t want the upfront cost of thebuying and deploying their own RFID network and may not be staffedfor such an undertaking. Outsourcing is a viable solution for manybusinesses. As RFID deployments become larger, interest in managedservices grows. As they see success of their pilots, CIO s are beginningto think about what happens when they start to put hundreds of thesedevices in their network.AT&T RFID Services focus on contactless payment services, asset trackingand management and security applications across manufacturing,transportation, retail and government markets. We currently provideassessment, design, implementation and end-to-end managed RFIDservices to help clients of any size quickly and effectively implementRFID solutions. AT&T s offerings include RFID readers, consulting andintegration solutions, IP transport, hosting, managed applications andsecurity services. AT&T has developed our own RFID network, datamanagement infrastructure and applications to host our customers RFID networks.About the AuthorsAT&T Labs is made up of approximately 4,500 of the world s bestscientists and engineers. We have experts in advanced data networking,software engineering, systems integration and speech technology. Ourresearch team has helped to build one of the premier telecommunicationslaboratories in the world in terms of excellence in the frontiers ofscience, invention of new communications concepts and tools andincubation of new services. Development teams offer world-classtechnical expertise and knowledge of complex systems. Our experienceenables AT&T to rapidly integrate anything from home grown softwareto off-the-shelf products, creating innovative new services andenhancing AT&T s own operations.08/28/07 AB-0451-01 2007 AT&T Knowledge Ventures. All rights reserved. AT&T is a registered trademark of AT&TKnowledge Ventures.
