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Home » Markets Will Continue Growing, Diversifying

Markets Will Continue Growing, Diversifying

February 20, 2009
Ann Grackin, chief executive officer, ChainLink Research

ChainLink Research sees the RFID market continuing to grow in size and diversity of application for the short and long haul. Although the market has seen some consolidation, it isn't the type we see in mature markets.

Understanding this market requires significant hardware and industry vertical expertise, with a global eye. The diversity of RFID and mobile solutions cross-pollinates across processes, companies and industries. Embedded applications within hardware platforms, industrial equipment, various devices, and adding complementary devices such as sensors, increases the application space, as well as the ecosystem of services to implement and service these devices once in operation. To size the market, looking at hardware sales helps, since these are "hard'" numbers and can then reflect the complementary and adjacent markets that leverage each other.

Beyond the Proof Point

RFID technology, implementation experience and value realization have evolved quickly in the last few years. With global standards-not just for hardware but also data-the confidence of the user should be high. Read-range issues and assurance of reliability are largely behind us. Today's obstacles in implementation are often a lack of imagination. And what imagination has been demonstrated! Resales into existing accounts are high, since once users gain experience they tend to not only increase the current application they are rolling out but experiment and then deploy new areas within their enterprise. Surveys we have run in healthcare/life sciences, manufacturing, high-tech, food and beverage, industrial, maritime, mining and others have demonstrated understanding of application value and ROI in projects. Some exciting new areas are home, games sports, "retail experience" ... too many to mention!

Large solution areas are beyond pilot now in markets such as asset and consumable traceability, security, authentication and auto/remote instruction. Most heartwarming are solutions for the sight and hearing impaired, the disabled and first responder applications.

Software backbones/network applications are now in use worldwide, providing the one-two punch the industry needs-item level with integration across the globe.

Hardware providers are gaining the smarts to leverage larger channel/integrator partners to insure the numbers to make the sales and implement the solutions. This scaling is enabling market growth. 

The Outlook

Variability of technology aside, ChainLink estimates the market continues to grow year on year at about 15 percent. Some very large deals were crafted in 2007 and 2008 and ChainLink sees that as a sign of things to come. Not only the deal size but the number of deals grows. Device prices have dropped quickly, easing the concerns about start-up costs. Many large-scale pilots have come to a successful close and onto major roll-outs. In the short run, government will continue to catalyze the interest, as well as the positive reports of ROI and efficiencies gained.

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Ann Grackin, chief executive officer, ChainLink Research

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