Companies must start preparing to introduce radio frequency identification devices (RFIDs) into their business lives, say technology experts.
Mike Agerbo, "chief creative officer" with Vancouver-based Chalk Media, spoke about the fast-emerging RFID technology at the recent Techvibes Massive Conference and Expo 2005 at Science World in Vancouver.
"It's going to be difficult for some businesses, but it's all going that (RFID) way," says Agerbo, who with Chalk Media founder Dave Chalk hosts a popular technology television show and develops other programming and online educational materials.
As thin as a human hair, an RFID is a tiny wireless chip that is used to track a product from its manufacturing plant to the customer - and all points in between.
|Bayne Stanley, Business Edge|
|Bartek Muszynski holds up an RFID tag, which is making a revolutionary leap beyond barcodes.|
The device functions like a barcode in many respects; however, thousands of RFIDs can be scanned at once, whereas barcodes can only be scanned one at a time. RFIDs can also store much more information.
"This is something that (company operators) are going to have to factor into the cost of doing business," Agerbo says. "But at the same time, they can maybe even look at the cost savings as far as efficiencies. They'll realize that they are really and truly able to keep track of their inventories."
Depending on how advanced they are, RFIDs cost from a fraction of a cent up to $20 for a single unit. Companies will have to be able to scan RFID-equipped products to store their information.
When used in conjunction with related technologies that store credit card data and process transactions, RFIDs can eliminate the need to pay a clerk at a checkout counter. They are also expected to help airlines save large sums on the retrieval of lost luggage.
Bartek Mus-zynski, president and CEO of Richmond-based NJE Consulting Inc., which helps businesses implement RFID, says the technology is poised to revolutionize all aspects of the distribution of goods in the next five to 10 years, even more than the barcode did.
"This will spell significant changes for all business, both wholesalers and retailers, as they invest in RFID hardware and software systems to keep up with emerging standards," says Muszynski.
The B.C. forest industry, he says, has the potential to become a world leader in the use of RFID for tracking raw and processed lumber from the woods to the finished product.
Canada's cattle industry is already familiar with RFIDs. As of Jan. 1, Ottawa has required all Canadian cattle to be fitted with RFID tags to help track them more easily and prevent the spread of bovine spongiform encephalopathy (mad cow) and other diseases.
Depending on the size of the operation, RFID technology will cost companies approximately $5,000 to several million dollars, says Muszynski, although he predicts costs will come down as the technology improves and becomes more common. Companies will need to acquire tags, readers and software.
Muszynski's clients include the province's forest ministry, which wants to track logs; Richmond RCMP, which wants to track its firearms and radios; and a recycling firm that is keeping tabs on bags of shredded paper.
"Looking at the near-term, any company that needs to track any physical items for any purpose can benefit tremendously from RFID technology, says Muszynski.
To avoid privacy issues, most RFID tags will have to be de-activated at the point of purchase. Otherwise, people's movements will be traceable.
Muszynski, an electrical engineer who trained at the University of Calgary, has implemented satellite-imagery ground stations with MacDonald Detwiler and created data-collection systems for Honeywell Canada and IBM. He launched his home-based business two years ago, but remained working for another employer for a year as demand built to the point where he can now focus on RFID full-time.
"I would describe (demand) as a steady trickle of interested companies," says Muszynski.
Retail giant Wal-Mart is also helping spur the RFID movement in North America. The big-box retailer will require 80 per cent of its vendors to place RFIDs in their products by next year. According to electronics giant Philips, which is manufacturing RFIDs, the devices are already being implemented in Asia.
"With big players like Wal-Mart forcing the industry to make that happen, the smaller players are going to have to (adapt) as well to keep up," says Chalk Media's Agerbo. "I think there will be a few-year lag after the big players get involved, but within the next five years, you'll find most of the industry jumping on board."
Agerbo says business owners should do their homework on RFIDs and related technologies and observe what others are doing before jumping on the bandwagon.
"When Wal-Mart jumps into this thing and all the manufacturers and vendors have the RFID technology, it's not going to be seamless - it's not going to work flawlessly overnight," he says.
"Look at all the mistakes that are made there. Learn from them, so that when you do it for your business, you're doing it at the right time and you're doing it efficiently and making sure that you're not making the same mistakes."
Agerbo and Chalk also advised the audience to get ready for WiMAX, an upgrade to WiFi (wireless fidelity or networking) technology, which connects wireless devices such as cellphones, Palm Pilots and BlackBerries to base stations and transmitters that distribute their voice, other sounds, photos, video and text over the Internet.
Basil Peters, manager of the B.C. Tech Fund, which provides venture capital to early-stage tech startups, describes WiMAX as "WiFi on steroids."
He says it will allow digital devices to connect with each other at much higher speeds and over much greater distances.
Vancouver-based Metrobridge Networks Corp., which bills itself as a wireless version of an Internet service provider and is backed by Peters' fund, is one of the local companies involved in developing WiMAX-related services.
Peters, who also spoke at the conference, says Metrobridge is just one of many B.C. technology companies that are rising from the dot-com dust.
"The tech market is starting to come back," says Peters, whose fund will invest $9 million in B.C. technologies this year. "The psychology of the average person in technology is improving a lot. People are out there now looking for money. They're starting new businesses. It's been much more active now than it was any time in the last three or four years."
In 1999-2000, when the tech bubble was bursting, the knock against dot-com companies was that they didn't produce anything marketable. Tech developers will now find it much easier to raise money - and grow their businesses, says Peters.
Meanwhile, the provincial government has announced it will supply high-speed Internet connectivity across the province.
Although more than half of B.C. households have high-speed access, 151 communities - of which 76 are First Nations - do not have it. The Network B.C. Digital Divide program is like Alberta's SuperNet, which is designed to connect rural northern communities with southern urban centres.
"We've approached it very differently (from Alberta)," says MacDonald. "They put a lot of money into it up front and now they're building it. What we're doing is working with the vendor community to build it. We have an agreement that, in order to do business with us, we get to use our network free."
Unlike in Alberta, B.C.'s digital divide is greatest in the southern half of the province. MacDonald says the province will devote $400 million per year to core technology services, including networks, hosting services, mainframe computers, servers and work stations.
The conference and trade show, hosted by Vancouver-based Techvibes Media Inc. in conjunction with the B.C. Technology Industries Association, drew 4,200 business professionals looking for information on high-tech products. Formerly known as E-Business Day, the annual event resumed after a one-year hiatus.
(Monte Stewart can be reached at email@example.com)