IDTechEx has researched the RFID industry to bring new forecasts for the years ahead. Cumulative sales of RFID tags for sixty years until the beginning of 2006 totalled 2.4 billion, with 600 million tags being sold in 2005 alone. In 2006, IDTechEx expect 1.3 billion tags to be sold. Of that about 500 million RFID smart labels will be used for pallet and case level tagging but the majority will be used for a range of diverse markets from baggage and passports to contactless payment cards and drugs.

In the short term large closed loop markets requiring high value RFID will remain very profitable and companies will seek to position themselves as the leader in hardware and integration in different vertical market segments. Challenges with tag yield versus cost, frequency acceptance, specification creep and required performance levels are some of the key issues that are being resolved to grow the RFID market exponentially over the coming years to be almost ten times as large in 2016 as in 2006. In 2016, IDTechEx see the value of the total market including systems and services to rocket to 26.23Bn from 2.71Bn in 2006 in value. The number of tags delivered in 2016 will be over 450 times the number delivered in 2006.

This includes many new markets that are being created, such as the market for Real Time Location Systems using active RFID. Indeed, the market for active RFID will itself be more than 6Bn in 2016.

Growth in passive RFID will be driven by the tagging of high volume items - notably consumer goods, drugs and postal packages - at the request of retailers, military forces and postal authorities and for legal reasons. In these cases, the primary benefits sought will be broader and include cost, increased sales, improved safety, reduced crime and improved customer service.

2006 RFID trends
Many companies are increasingly focusing on profitable value-added niche markets, many of which will ultimately be billion dollar, billion tag opportunities, such as the tagging of books, drugs, tires, ticketing, secure documents (passports and visas), livestock, baggage and much more. We also see more acknowledgement of different frequencies and increased interest and more development on HF (13.56MHz) tags and systems (welcome back HF - all is forgiven?!).

Related links: (Open in a new window.)
www.idtechex.com/products/en/view.asp?productcategoryid=93
rfid.idtechex.com/smartlabelsusa06/en/index.asp
www.idtechex.com/

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