Half a billion RFID tags shipped in 2005

RFID growth is attributed to an increase in contactless payment cards and personal ID documents

More than 565 million high-frequency RFID integrated circuits were shipped in 2005, according to the latest findings of ABI Research's RFID Tag IC Market Sizing Database.

Sara Shah, RFID industry analyst at ABI Research, said: "In the year from the first quarter of 2005 to the first quarter of 2006, shipments of HF ISO14443 tag integrated circuits increased 104 per cent, the highest growth rate of any segment we measured.

"This growth can be attributed to an increase in contactless payment cards, and personal identification documents such as e-passports. Both are high volume, high growth applications."

The US began issuing e-passports to its citizens this month, following plans laid out in the Visa Waiver Programme.

The 27 nations in this programme have either begun issuing e-passports or plan to by October, demonstrating that this is a global application of RFID.

ABI Research expects that government initiatives are driving, and will continue to drive, strong growth in this sector.

Many countries have plans for other forms of personal identification documents such as government and national ID cards which will fuel long-term growth in addition to e-passport replacement and re-issuance cycles.

RFID has been further boosted during the past year by US contactless payment and transit-ticketing trials.

Open loop transit ticketing applications in North America, for example, have prompted several major cities such as New York to test public transport contactless ticketing systems.

Meanwhile other regions including Europe and Asia that began embracing contactless technology earlier are now implementing the technology at higher rates with fuller, wider deployments.

These two factors have helped this market achieve significant growth. "North American credit card companies are becoming more bullish about contactless payment," said Shah.

"They are taking steps to introduce the technology to their customers, for example through media campaigns, trials and new contactless card distribution. This should continue to drive HF ISO14443 tag integrated circuit markets."