RFID is a generic term for technologies that employ radio waves to automatically identify people or objects. There are several methods of identification, but the most common is to store a serial number that identifies a person, object, or other information, on a microchip that is attached to an antenna (the chip and the antenna together are called an RFID transponder, or an RFID tag).
The chip, which is about the size of a grain of sand, activates a signal when it approaches an electronic reader. Though RFID technology has been around since World War II, when it helped ground soldiers identify fighter planes as friend or foe, the cost of developing it has been prohibitive. Now, thanks to advances in technology, RFID is here to stay. Business experts predict that RFID chips will be found in thousands of products by 2010, and that the technology will revolutionize supply chain, manufacturing, and retail efficiency.
Radio frequency identification (RFID) has already started to change the retail industry with its ability to track goods from the factory floor to retail shelves. Now, RFID is helping companies in other industries improve supply chain management, identify counterfeit products, and reduce inventory shrinkage.
One of the first consumer applications of RFID was automated toll collection systems, which were introduced in the late 1980s and caught on in the 1990s. An active transponder is typically placed on a car’s or truck’s windshield. When the car reaches the tollbooth, a reader at the booth sends out a signal that wakes up the transponder on the windshield, which then reflects back a unique ID to the reader at the booth. The ID is associated with an account opened by the car owner, who is billed by the toll authority. Consumers spend less time fumbling for change or waiting in lines to pay their toll fee.
In the late 1990s, ExxonMobil (then just Mobil) introduced Speedpass, an RFID system that allows drivers who have opened an account to pay for gas automatically. Drivers are given a small, passive 13.56 MHz transponder in a small wand or fob that can be put on a key chain. To pay for gas, they just wave the key fob by a reader built into the gas pump. Seven million people in the United States use the system, and it has increased the number of cars each gas station can serve during rush periods.
MasterCard and Visa are experimenting with RFID to give consumers the convenience of paying for small purchases with a wave of a contactless smart card or key fob. NCR, Verifone and other companies are selling mag-stripe credit card machines with a built-in RFID reader.
RFID has other consumer applications, besides being a convenient payment system. One is the recovery of lost or stolen items. A company called Snagg in Palo Alto, Calif., has created an electronic registry for musical instruments. It provides an RFID tag that can be affixed to a classic guitar or priceless violin and keeps a record of the serial number in the tag. If the instrument is recovered by the police after being lost or stolen, they can call Snagg, which can look up the rightful owner.
Toy companies are embedding RFID tags in toys to make them interactive. When Star Wars: Episode I – The Phantom Menace was released in 1999, Hasbro created action figures with embedded RFID tags. When children brought the figures close to a base station, a reader recognized the figure and addressed it by name.
RFID could be used to create smart products that interact with smart appliances. Unilever, the Anglo-Dutch consumer products goods company, has created a prototype kitchen of the future in which RFID readers in the pantry read all the tags on products on the shelves. A computer program determines what items need to be purchased from the store.