RFID industry heading for shakeout

The global radio frequency identification (RFID) market is poised for a dramatic shakeout in the coming six to nine months as firms struggle to develop the management software required to power RFID infrastructures, industry watchers predicted today.

ABI Research said that development initiatives are "flying thick and fast" but warned that many existing RFID vendors and technologies will fail amid a period of acquisitions and consolidation as players vie to develop more business focused RFID software and applications.

Erik Michielsen, ABI Research's director of RFID and ubiquitous networks, explained that movement into this software space comes from several directions.

"SAP, with its Auto ID Infrastructure as part of NetWeaver, is pushing down from the enterprise application space and picking up functions traditionally done by OATSystems, Acsis, Connecterra, Sun Microsystems and GlobeRanger," he said.

In turn, some of these companies are broadening their focus beyond RFID middleware into data analytics, business intelligence and automation networking, according to ABI Research's RFID Research Service. 

"OATSystems is a good example of this trend by pushing up and becoming competitive with some NetWeaver functionality, and it is joined in the business intelligence space by T3Ci," said Michielsen.

Sun, Connecterra, Oracle and Microsoft are all moving into this field according to their respective strengths, Michielsen added.

Others, such as Manhattan Associates and Siemens, are expected to continue developing RFID middleware in-house, but Michielsen questioned the need to keep building closed system and/or customised solutions between the reader and the enterprise application integration layer.

"I think they would be better off partnering and focusing the resulting free energy on services and higher-end software," he concluded.