While the retail sector has been the fastest to adopt RFID, the technology also is being rolled out in consumer goods, logistics, life sciences, automotive, and government markets, according to the report. The upside is reduced costs and better inventory control and consumer demand responsiveness.
The uptake will help the worldwide market for RFID technologies to grow to $10.9bn, according to ABI Research.
However, even though some privacy concerns over RFID have been overstated, there remains genuine privacy issues to be resolved, said the Economist researchers. They include the ability for anyone with an RFID reader to track people by the items they wear or carry.
Legislators should require that RFID tags be deactivated at point of sale to allay privacy concerns, but not require the permanent killing of stored data, as this would limit users’ ability to opt-in to interesting post-sale applications that benefit consumers as well as businesses, said the researchers.
RFID is being used successfully in corporate supply chains, and there are a range of potentially valuable applications in the pipeline, said Gareth Lofthouse, director of custom research in Europe at the Economist Intelligence Unit. But for RFID to achieve its potential, the industry must address valid concerns over customer privacy.
A range of technical, business and political barriers to RFID’s development also still exist, said the researchers. Standards bodies and academic institutions need to harmonize hardware and software standards globally, while companies should lay out a framework that helps them understand and address the process changes required to get value from the technology.
The report by the Economist Intelligence Unit was sponsored by The North of England Inward Investment Agency, which promotes direct business investments from North America.
