Asia catching up on RFID

While the U.S. will remain top market for radio frequency identification services, an industry watcher predicts the Asia-Pacific region to be on par within three to four years.

SINGAPORE--The Asia-Pacific region will overtake Europe and be on par with the United States in the deployment of radio frequency identification (RFID) services in the next three to four years.

Frank Dorrian, president of International RFID Business Association (RFIDba) Asia-Pacific, gave this prediction during his presentation at the RFID World Asia conference here Wednesday.

"Asia-Pacific is the manufacturing center of the world and as companies look to improve on their supply chain management, this will be one of the drivers to propel the region's RFID market to the forefront," Dorrian said.

The region currently accounts for 25 percent of the global RFID market, he said, noting that this reflects a "rapid uptake" from 3 percent some 40 years ago. Comparatively, the U.S. takes up 45 percent market share and Europe the remaining 30 percent, he added.

RFID tags, which can carry descriptive information about a product, have long been touted to help track and improve inventory management by allowing manufacturers, for example, to more easily capture data about a carton of goods without having to physically open the carton. Wal-Mart was a major early adopter when the U.S. retail giant issued a mandate calling for its largest suppliers to tag their goods with RFID.

Speaking to ZDNet Asia on the sidelines, Dorrian said government mandates and specific needs in each country are driving adoption of RFID technology in the Asia-Pacific region.

He gave the example of Australia, which in 2005 mandated that the nation's livestock, such as cattle, sheep and goats, had to be RFID-tagged.

"This was after the 'mad cow' disease broke out in the U.S. in 2004 and Australia, by using RFID tagging, was able to trace the whole life cycle of its cattle from birth to slaughter," ," said Dorrian explained. "Australia soon replaced the U.S. to become a key supplier of beef in the Asia-Pacific region because it could provide quality assurance for its products."

Tags make rounds in Asia
Elsewhere in the region, Singapore has also gone big on its adoption of RFID in the healthcare field, following the government's push to establish the Republic as a global healthcare hub, while China is focused on utilizing the technology to improve its supply chain management as well as anti-counterfeiting measures.

He also highlighted South Korea as being "big on sensors" and has embarked on "many interesting projects".

One such project involves the local medical sector where plans are underway to have 50 percent of all drugs sold in the country tracked by RFID tags by 2015, according to The Korea Times. "Government officials suggest that the RFID tags will improve efficiency in distribution, allowing pharmaceutical companies to save around 1.8 trillion won (US$1.6 billion) annually, and also providing an easier way to retrieve subpar quality drugs," the article stated.

In Singapore, RFID has also been applied in the hospitality sector. Yap Chee Yuen, senior vice president of the newly-opened Resorts World Sentosa, said RFID tags are embedded in the company's employee cards so staff can easily clock in and out of the premise, collect their meals and uniforms as well as access the facilities at the integrated resort.

High-value assets have also been tagged to prevent theft, said Yap, who was also a speaker at the conference. Casino chips, for instance, are fitted with RFID tags to deter and detect counterfeits at the cashier's counter, he added.

However, in terms of adoption within the region, the market continues to face long-standing challenges.

Dorrian said: "Lack of awareness, user education and understanding the business models of what this disruptive technology can do for organizations, are the top three challenges currently facing the region."

Privacy is another key concern that has been widely discussed since the technology first emerged but Dorrian believes that, just like electronic medical records, people will eventually "get past it".

"Many people were like, 'I don't want my medical records to be made public'. But, over time, they saw that it was useful to have it in instances when they are injured overseas and the local hospitals need their medical records," he noted. "Similarly, RFID technology will be accepted by people once they see the value in it."