RFID Market Gaining Momentum - Global Shipments Of RFID Systems Estimated At $890 Million, Expected To Reach $2.65 Billion By 2005
6/15/2001
Recent analysis from Venture Development Corporation (VDC) reveals that global shipments of RFID systems (including transponders, readers, software, and services) reached $890 million in 2000. According to VDC’s just-published market study entitled “Global Markets and Applications for Radio Frequency Identification Equipment and Systems,” shipments of RFID systems are expected to increase by approximately 24.0% annually to reach $2.65 billion by 2005.
While the RFID market is growing and gaining momentum, market infrastructure issues - including standards development, channel training, and end-user education - has limited more rapid expansion. Regardless, the RFID market is expected to provide strong near and long term growth opportunities. Global demand for RFID equipment and systems will be driven by various factors ranging from continued reductions in transponder unit costs, increased viability of RFID solutions, technological developments towards RFID interoperability, and advancements made in the development of technical and application standards.
Overall, the RFID market continues to be one of great anticipation. While growth over the past few years has been somewhat slower than previously projected, it continues to outpace other automatic identification technologies. Many of the issues acting as barriers to more consistent growth continue to hold true today; with a lack of standards and price expectations being among the most prominent. While standards development and cost reduction have been at the forefront of suppliers’ strategic and tactical agendas, they, in addition to a lack of applications, continue to be the most frequently mentioned reasons why potential end users choose not to adopt the technology.
RFID suppliers are optimistic about the industry’s future and have great confidence that their products and services can solve problems across multiple vertical and application markets. There is no monopoly on innovation. Some of the largest and smallest RFID vendors are making significant technological innovations to support current, emerging, and future applications. The overall growth and adoption of RFID, however, will be uneven across economic and vertical markets.
While the industry has grown over the last few years, much of the growth came from traditional, established applications -including security/access control and automobile immobilization. RFID manufacturers have proven that the technology can work in many applications and end users have a better, yet incomplete, understanding of how RFID technology can benefit them. Undoubtedly the RFID market will grow and continue to work through its issues - issues typical of any immature technology. RFID will make further progress in the next five years, how rapidly depends on the actions and efforts of all players in the RFID market. |
