RFID Technology

An RFID system consists of a tag made up of a microchip with an antenna, and an interrogator or reader with an antenna. The reader sends out electromagnetic waves. The tag antenna is tuned to receive these waves. A passive RFID tag draws power from the field created by the reader and uses it to power the microchip's circuits. The chip then modulates the waves that the tag sends back to the reader, which converts the new waves into digital data. For more information on the components of a complete system used in businesses, see Getting Started.

Just as your radio tunes in to different frequencies to hear different channels, RFID tags and readers have to be tuned to the same frequency to communicate. RFID systems use many different frequencies, but generally the most common are low-frequency (around 125 KHz), high-frequency (13.56 MHz) and ultra-high-frequency or UHF (860-960 MHz). Microwave (2.45 GHz) is also used in some applications. Radio waves behave differently at different frequencies, so you have to choose the right frequency for the right application.

Different frequencies have different characteristics that make them more useful for different applications. For instance, low-frequency tags use less power and are better able to penetrate non-metallic substances. They are ideal for scanning objects with high-water content, such as fruit, but their read range is limited to less than a foot (0.33 meter). High-frequency tags work better on objects made of metal and can work around goods with high water content. They have a maximum read range of about three feet (1 meter). UHF frequencies typically offer better range and can transfer data faster than low- and high-frequencies. But they use more power and are less likely to pass through materials. And because they tend to be more "directed," they require a clear path between the tag and reader. UHF tags might be better for scanning boxes of goods as they pass through a dock door into a warehouse. It is best to work with a knowledgeable consultant, integrator or vendor that can help you choose the right frequency for your application.


It depends on the vendor and the application, but typically a tag carries no more than 2KB of data—enough to store some basic information about the item it is on. Companies are now looking at using a simple "license plate" tag that contains only a 96-bit serial number. The simple tags are cheaper to manufacture and are more useful for applications where the tag will be disposed of with the product packaging.

Microchips in RFID tags can be read-write, read-only or “write once, read many” (WORM). With read-write chips, you can add information to the tag or write over existing information when the tag is within range of a reader. Read-write tags usually have a serial number that can't be written over. Additional blocks of data can be used to store additional information about the items the tag is attached to (these can usually be locked to prevent overwriting of data). Read-only microchips have information stored on them during the manufacturing process. The information on such chips can never be changed. WORM tags can have a serial number written to them once, and that information cannot be overwritten later.

Active RFID tags have a transmitter and their own power source (typically a battery). The power source is used to run the microchip's circuitry and to broadcast a signal to a reader (the way a cell phone transmits signals to a base station). Passive tags have no battery. Instead, they draw power from the reader, which sends out electromagnetic waves that induce a current in the tag's antenna. Semi-passive tags use a battery to run the chip's circuitry, but communicate by drawing power from the reader. Active and semi-passive tags are useful for tracking high-value goods that need to be scanned over long ranges, such as railway cars on a track, but they cost more than passive tags, which means they can't be used on low-cost items. (There are companies developing technology that could make active tags far less expensive than they are today.) End-users are focusing on passive UHF tags, which cost less than 40 cents today in volumes of 1 million tags or more. Their read range isn't as far—typically less than 20 feet vs. 100 feet or more for active tags—but they are far less expensive than active tags and can be disposed of with the product packaging.

There really is no such thing as a "typical" RFID tag, and the read range of passive tags depends on many factors: the frequency of operation, the power of the reader, interference from other RF devices and so on. In general, low-frequency tags are read from a foot (0.33 meter) or less. High-frequency tags are read from about three feet (1 meter) and UHF tags are read from 10 to 20 feet. Where longer ranges are needed, such as for tracking railway cars, active tags use batteries to boost read ranges to 300 feet (100 meters) or more.

Tag collision occurs when more than one transponder reflects back a signal at the same time, confusing the reader. Different vendors have developed different systems for having the tags respond to the reader one at a time. These involve using algorithms to "singulate" the tags. Since each tag can be read in milliseconds, it appears that all the tags are being read simultaneously.

"Chipless RFID" is a generic term for systems that use RF energy to communicate data but don't store a serial number in a silicon microchip in the transponder. Some chipless tags use plastic or conductive polymers instead of silicon-based microchips. Other chipless tags use materials that reflect back a portion of the radio waves beamed at them. A computer takes a snapshot of the waves beamed back and uses it like a fingerprint to identify the object with the tag. Companies are experimenting with embedding RF reflecting fibers in paper to prevent unauthorized photocopying of certain documents. Chipless tags that use embedded fibers have one drawback for supply chain uses—only one tag can be read at a time.

No. Radio waves bounce off metal and are absorbed by water at ultra-high frequencies. That makes tracking metal products or those with high water content problematic, but good system design and engineering can overcome this shortcoming. Low- and high-frequency tags work better on products with water and metal. In fact, there are applications in which low-frequency RFID tags are actually embedded in metal auto parts to track them.

RFID Readers

An agile reader is one that can read tags operating at different frequencies or using different methods of communication between the tags and readers.

These terms are not precise, but many people use "intelligent reader" to describe one that has the ability not just to run different protocols, but also to filter data and even run applications. Essentially, it is a computer that communicates with the tags. A "dumb" reader, by contrast, is a simple device that might read only one type of tag using one frequency and one protocol. This type typically has very little computing power, so it can't filter reads, store tag data and so on.

One problem encountered with RFID is that the signal from one reader can interfere with the signal from another where coverage overlaps. This is called reader collision. One way to avoid the problem is to use a technique called time division multiple access, or TDMA. In simple terms, the readers are instructed to read at different times, rather than both trying to read at the same time. This ensures that they don't interfere with each other. But it also means any RFID tag in an area where two readers overlap will be read twice. So the system has to be set up so that if one reader reads a tag, another reader does not read it again.

This is a mode of operation that prevents readers from interfering with one another when many are used in close proximity to one another. Readers hop between channels within a certain frequency spectrum (in the United States, they can hop between 902 MHz and 928 MHz) and may be required to listen for a signal before using a channel. If they "hear" another reader using that channel, they go to another channel to avoid interfering with the reader on that channel.

The Cost of RFID Equipment

There is no such thing as a 5-cent RFID tag that can store a unique serial number. (There are chipless RFID systems that cost less than 5 cents per tag, however.) EPCglobal's goal is to drive adoption to the point where massive numbers of tags are made each year and the cost drops to 5 cents per tag. It will take at least four years to reach the volumes necessary, though, and many experts say that we may never see a 5-cent tag.

The cost depends on the application, the size of the installation, the type of system and many other factors, so it is not possible to give a ballpark figure. In addition to tag and reader costs, companies need to purchase middleware to filter RFID data. They may need to hire a systems integrator and upgrade enterprise applications, such as warehouse management systems. They may also need to upgrade networks within facilities. And they will need to pay for the installation of the readers. Not only do the readers need to be mounted, they need electrical power and to be connected to a corporate network.

RFID Standards

Yes. International standards have been adopted for some very specific applications, such as for tracking animals and for smart cards, which require encryption to keep data secure. Many other standards initiatives are under way. The International Organization for Standardization (ISO) is working on standards for tracking goods in the supply chain using high-frequency tags (ISO 18000-3) and ultra-high frequency tags (ISO 18000-6). EPCglobal, a joint venture set up to commercialize Electronic Product Code technologies, has its own standards process, which was used to create bar code standards. EPCglobal has said that it intends to submit EPC protocols to ISO so they can become international standards.

The Auto-ID Center developed Class 1 and Class 0 specifications for EPC tags and handed these off to EPCglobal in September 2003. In June 2004, these two specifications completed EPCglobal's standardization process and became the first EPC "standards." In December 2004, EPCglobal's board approved a single second-generation standard that will eventually replace Class 1 and Class 2.

Gen 2 is the shorthand name given to EPCglobal's second-generation EPC protocol. It was designed to work internationally and has other enhancements such as a dense reader mode of operation, which prevents readers from interfering with one another when many are used in close proximity to one another.

The term “foundation protocol” is sometimes used to describe the second-generation EPC air interface protocol, or UHF Gen 2. EPCglobal calls it the foundation protocol because Gen 2 is designed a way that higher-class tags will also talk to readers. These higher-class tags will have more memory, encryption capabilities, the ability to use a battery to broadcast a signal to a reader and the ability to communicate information from temperature and other sensors. The Foundation Protocol is expected to be approved by the end of 2004.

The Electronic Product Code is a standard created by EPCglobal. Although it was designed to be a global standard for use in many industries, EPC is not an international standard approved by The International Organization for Standardization. EPCglobal, the body responsible for EPC technology, says it plans to submit the EPC Gen 2 protocol to ISO for approval. ISO has created many standards for RFID. These deal with both the air-interface protocol and applications for RFID. EPC deals with more than just how tags and readers communicate. EPCglobal wants to create network standards to govern how EPC data is shared among companies and other organizations.

ISO 18000-6 is a proposed international standard governing the way tags and readers communicate in the UHF spectrum. There are currently two versions, 18000-6A and 18000-6B. It is possible that EPCglobal's Gen 2 standard could become an international standard and be called ISO 18000-6C, but as of December 2004, the Gen 2 standard did not include an 8-bit application family identifier, which would be required for it to be an ISO 18000-6 standard.

Gen 2 was designed to work internationally and has other enhancements that are significant, but the real benefit of Gen 2 is that it works anywhere in the world and major manufacturers of chips and tags have lined up behind it. That competition will drive up volume and drive down price. The first Gen 2 tags arrived on the market in the third quarter of 2005 and several companies, including Avery Dennison and UPM Rafsec, announced low-priced tags. Lower prices and the ability of tags to work internationally will drive adoption.

EPCglobal and Auto-ID Labs

EPCglobal is a not-for-profit joint venture set up by the Uniform Code Council, which licensed the EPC technologies developed by the Auto-ID Center, and EAN International, the bar code standards body in Europe. EPCglobal is an umbrella organization overseeing local chapters that will work with companies to encourage the adoption of EPC technologies. EPCglobal will issue EPCs to companies that subscribe to its service.

The Auto-ID Center was set up in 1999 as a not-for-profit consortium to develop a system for using the Internet to identify goods anywhere in the world, using something called the Electronic Product Code (EPC). It was originally supported by the Uniform Code Council, EAN International, Procter & Gamble and Gillette, and was based at the Massachusetts Institute of Technology in Cambridge, Mass. Over time, it received funding form large companies who wanted to use RFID to track goods, and who believed an open standard was critical. Other labs were established in England, Switzerland, Japan and China. In October 2003, the center closed its doors and was transitioned into two separate organizations: EPCglobal took over the commercialization of EPC technologies, while Auto-ID Labs continued the research and development role of the Auto-ID Center.

The Auto-ID Labs are nonprofit research labs, headquartered at the Massachusetts Institute of Technology, that do primary research into the development of EPC and related technologies. The labs were part of the Auto-ID Center. The name was changed when the Auto-ID Center ceased to exist after October 2003.

The original vision was for EPC technology to be used on all types of products, not just consumer products. Having a single numbering scheme would make it easier to track goods not just within an industry but across industries as well. Goodyear, for instance, sells tires to automakers and to Wal-Mart, and it would be better to use one numbering scheme to track all their tires. But many industries have their own numbering systems, and EPCglobal is now working on a "translation engine"—a software system that would convert EPCs into industry-specific numbers and back again. Many industries are moving toward adopting EPC technology, including pharmaceuticals, defense, electronics and computing.

The Electronic Product Code

The Electronic Product Code (EPC) was created by the Auto-ID Center as an eventual successor to the bar code. The aim was to create a low-cost method of tracking goods using RFID technology. The benefit of RFID is that it doesn't require line-of-site, which means goods can be scanned through packaging and without needing people to scan items. EPC tags were designed to identify each item manufactured, as opposed to just the manufacturer and class of products, as bar codes do today.

The EPC is a string of numbers and letters, consisting of a header and three sets of data partitions. The first partition identifies the manufacturer. The second identifies the product type (stock keeping unit) and the third is the serial number unique to the item. By separating the data into partitions, readers can search for items with a particular manufacturer's code or product code. Readers can also be programmed to search for EPCs with the same manufacturer and product code, but which have unique numbers in a certain sequence. This makes it possible, for example, to quickly find products that might be nearing their expiration date or that need to be recalled.

EPC technology could dramatically improve efficiencies within the supply chain. The vision is to create near-perfect supply chain visibility—the ability to track every item anywhere in the supply chain securely and in real time. RFID can dramatically reduce human error. Instead of typing information into a database or scanning the wrong bar code, goods will communicate directly with inventory systems. Readers installed in factories, distribution centers, and storerooms and on store shelves will automatically record the movement of goods from the production line to the consumer.

The EPC header is used to indicate the format of the EPC code, (i.e. the length of field partitions), and was designed to make the system flexible. For instance, the header tells the reader whether the tag has a 64-bit or a 96-bit EPC. The header also makes it possible to divide the data partitions in different ways, so a manufacturer that makes large amounts of only a few products could shift digits from the object class partition to the serial number partition.

Companies have to create a network of RFID readers. In a warehouse for example, there could be readers around the doors on a loading dock and on every bay. When a pallet of goods arrives, the reader on the dock door picks up its unique license plate. Computers look up what the product is using the EPC Network. Inventory systems are alerted to its arrival. When the pallet is put in bay A, that reader sends a signal saying item 1-2345-67890 is in bay A.

How companies use EPC data and the EPC Network will be up to them, just as it's up to them to decide how they want to use the Internet. But the EPCglobal is working with industry partners to provide some basic tools that will help them take advantage of the network. VeriSign, for instance, has been awarded a contract to manage the root directory for the Object Name Service. VeriSign and others will host EPC Information Services for companies. And some of the functionality of Savants is being incorporated into commercial RFID middleware. These tools will enable companies to track and trace goods, which should help reduce counterfeiting, and enable many other improvements in supply chain efficiency. For instance, retailers may provide EPC data about stock levels in stores to enable automated replenishment of products.

The EPCglobal Network

The whole point of automatic identification is to take people out of the loop, to enable computers to gather information and act on it. For that to happen, computers must be able to not just identify a product, but also interpret some basic information about it. To make this possible, the Auto-ID Center started to develop a new computer language called the Physical Markup Language. PML is based on the widely accepted eXtensible Markup Language (XML), which is used to describe common types of data (addresses, dates, invoice numbers and so on) and transactions (purchases, requests for quotes and so on) in a way computers running different proprietary applications can understand. PML files will be stored in the EPC Information Service (once called PML servers). EPC Information Service will reside on computers distributed across the Internet. (The Object Name Service, described above, points computers to data about products stored in the EPC Information Service.) Some information about each product will be stored in a PML file, such as a product's name and broad category (soft drink, auto part, clothing and so on), when it was made and where, its expiration date, its current location, even its current temperature, if that's important. PML files will provide information to existing enterprise applications or new yet-to-be developed applications. The PML file could contain instructions for where a pallet should be shipped. It could contain instructions for a point-of-sale display to lower the price of an item when its expiration date approaches. Or it could contain instructions for how long your microwave needs to cook a particular brand of frozen pizza.

The Object Name Service (ONS) is an automated networking service similar to the Domain Name Service (DNS) that points computers to sites on the World Wide Web. When an interrogator reads an RFID tag, the Electronic Product Code is passed to middleware, which, in turn, goes to an ONS on a local network or the Internet to find where information on the product is stored. ONS points the middleware to a server where a file about that product is stored. The middleware retrieves the file (after proper authentication), and the information about the product in the file can be forwarded to a company's inventory or supply chain applications.

EPCglobal has awarded VeriSign a contract to maintain the root ONS directory. But the Object Name Service will handle many more requests than the Web's Domain Name Service. Therefore, companies will likely maintain ONS servers locally, which will store information for quick retrieval. So a manufacturer may store ONS data from its current suppliers on its own network, rather than pulling the information off the Web site every time a shipment arrives at the assembly plant. The system will also have built-in redundancies. For example, if a server with information on a certain product crashes, ONS will be able to point the RFID middleware to another server where the same information is stored.

Bar codes are a line-of-sight technology. That is, a scanner has to "see" the bar code to read it. That means people usually have to orient the bar code towards a scanner for it to be read. Also, if a bar code label is ripped, soiled or falls off, there is no way to scan the item. Radio frequency identification, by contrast, doesn't require line of sight. RFID tags can be read as long as they are within range of a reader. And since radio waves pass through plastic, tags can be protected from damage. Because RFID tags can communicate with readers without line of sight in most cases, RFID also has the potential to reduce out of stocks. Studies show that, on average, products are not on the store shelves 7 percent of the time. Every time a customer leaves a store without buying what they came for because it wasn't on the shelf, the retailer and the manufacturer lose out. RFID has the potential to dramatically reduce out of stocks by providing real-time visibility into what's on the store shelves. It also has the potential to dramatically reduce theft by alerting store employees to unusual activity at the shelves. It may also reduce employee theft, counterfeiting, administrative errors, and mass recalls. And there are some unique benefits associated with the ability to track individual items. Down the road, RFID tags have the potential to be combined with sensors to monitor the status of the product. Sensors might, for instance, detect that a shipment of milk was left in a warm environment for a period of time. Computer systems could then bring forward the milk's expiration date to account for the lack of refrigeration. Sensors might also reveal whether food products have been spoiled or tampered with. Once a company has installed the infrastructure to take advantage of tracking products over the EPC network, other capabilities can be added cost effectively.

There are many consumer benefits. Greater efficiency in the supply chain will reduce costs and improve efficiencies. Companies will pass some of these savings on to consumers to try to gain market share from less efficient competitors. RFID could be used by retailers to expedite returns and by manufacturers to manage warrantee claims and improve after-sales support of items such as computers and DVD players. RFID could also reduce the counterfeiting of pharmaceutical drugs and insure the integrity of products purchased by consumers. And RFID could be used to secure the food supply and prevent terrorists from sneaking weapons of mass destruction into a country through shipping containers.

Yes. A number of companies make RFID tags encased in protective plastic. These tags are designed for use in the laundry and uniform rental business. The tags used are typically 13.56 MHz tags, which have a read range of less than 3 feet (1 meter). Today, there is no way to embed a tag that is undetectable to the consumer into clothes. Companies that are testing RFID systems for tracking clothes in the supply chain are putting the RFID transponder on a hangtag that the consumer cuts off before wearing the item.

Other RFID Issues

RFID uses the low-end of the electromagnetic spectrum. The waves coming from readers are not dangerous.

RFID technology is a laborsaving technology, so it's likely that some tasks will be automated through the use of RFID. Fewer workers will be needed to scan bar codes. But the transition from bar codes to RFID could take a decade or more, so it is unlikely that RFID will lead to wide-scale displacement of workers. The technology will likely create new jobs, just as Internet technologies creating new jobs, from Web developers to warehouse workers managing inventory for online stores such as Amazon.com. The jobs that will be affected by RFID are those that involve scanning bar codes. Most of those jobs also have other components, such as moving products or restocking shelves. Those jobs will not go away because of RFID.