RFID
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RFID deployments will accelerate as more companies move to the cloud

Cloud computing continues to gain steam. A study from Saugatuck Technology predicts that almost two-thirds of all new business application/solution decisions will be cloud-based by 2015.

As RFID adoption continues to skyrocket, the benefits of cloud computing are expected to further accelerate deployment of the technology. By utilizing the cloud, enterprises can avoid costly infrastructure build-outs required for RFID technology. Cloud computing can also make the integration of new data seamless, benefiting stakeholders at both ends of the supply chain.

Pallet firm CHEP, Coca-Cola, Vail Resorts and many other companies already rely on the cloud to harness the crucial data that RFID provides them. The sweet spot for 2011 is likely supply chain applications, which are expected to flock to the cloud for hosting of RFID data and operations.

Many experts believe that a cloud-based architecture will quickly enable scalable RFID, eliminating one of the biggest roadblocks to adoption of the technology. Many technology providers are leveraging the cloud to deliver solutions that make RFID and the data mined by the technology more valuable than ever before.

“In the future we see RFID device makers further cloud-enabling their solutions for the marketplace,” Joe Pleshek, president and CEO of Terso Solutions, said during a recent webcast on RFID and the cloud. “You’ll also start to see more supply chain systems leveraging cloud-based RFID solutions.”

The benefits of cloud-based RFID solutions are numerous. For starters, operating in the cloud means that end users can eliminate costly up-front expenses to build-out RFID infrastructure. In addition, users gain the ability to receive state-of-the-art software updates on a regular basis, more frequently than most companies can provide on their own. Cloud-based services usually offer more functionality, and users only pay only for the services they subscribe to.

“According to an RFID end user survey we conducted in Q4 2010, more than 70 percent of respondents cited the following four reasons for adopting a cloud/hosted platform: cost savings, ease of implementation, ease of upgrading/refresh, and speed of deployment,” says Drew Nathanson, director of operations at VDC Research Group. “That figure is even higher when looking exclusively at the Tier II and Tier III communities.”

RFID is being integrated with the cloud in many ways. The Epic Mix app allows skiers at Vail’s five Colorado resorts to track their progress on the slopes and automatically track data from each ski run, including vertical feet skied and days on the mountain. Accessible online or via a mobile phone, the app relies on RFID-enabled lift tickets that are read by readers installed at each chair lift.

Skiers can see their progress online or on their mobile phones and can also share their accomplishments via social media updates. Skiers can also track their friends on the slopes, knowing when to break for lunch, for example. And the whole process is powered by hosting data on the cloud. “Vail Resorts is blazing a trail by using RFID to marry the physical world with the virtual world,” says Patrick Sweeney, CEO of ODIN, the firm behind the RFID portion of the technology.

Coca-Cola is leveraging the cloud to harness information from its RFID-enabled Freestyle vending machine drink dispensers. The machines allow consumers to choose from more than 100 categories of soda, juices and waters. Each vending machine uses 30 flavor cartridges equipped with Impinj Monzaâ„¢ tag chips and Indyâ„¢ reader chips. Readers assigned to cartridges record how many times they are used, and data is sent through wireless network to a centralized repository.

“This allows Coca-Cola to pull that information together and to analyze it for near real-time visibility to end user demand for certain flavors, as well as managing the inventory of cartridges,” says Terso’s Pleshek. “This deployment of RFID could only be done by utilizing a cloud-based infrastructure.”

That’s true in the case of CHEP, a pallet management company that includes RFID on all of the pallets it uses for freight deliveries around the world. Information collected from the RFID-enabled pallets and the bar codes of products on those pallets is connected to a cloud integration platform hosted by HubSpan, a provider of cloud-based B2B integration solutions. From that data, rules can be created for different products, such as temperature requirements for perishable goods.

Food manufacturers can put certain rules in place to dictate that certain products be stored at specific temperatures. That information is scanned and pushed up to the cloud, and HubSpan analyzes the data and creates rules that send alerts to end users about that product’s specifications.

“So by using RFID technology, we can drive information that allows businesses to be responsive to situations and be proactive,” says Nathan Cowan, general manager of global sales for HubSpan. “The cloud allows us to segment out those rules on a connection by connection basis.”

Of course, the cloud is not for everybody. Many companies have security concerns about storing data on the cloud, although Cowan says most security concerns are addressable. Companies also worry about a lack of control of data.

“You do lose some control,” says Nathanson. “You might own your data, but you lose some control and that’s one of the barriers for this. People are scared. There is some confusion out there about how the [hosting] companies are going to have ownership or even look at that data. So there are definitely pros and cons.”

While those trust issues remain to be worked out, providers of cloud-based services are emphasizing another kind of trust, that is the trust in knowing inventory information is accurate in real-time. That leads to better collaboration through the entire supply chain.

“When you can provide real time, as-it’s-happening visibility and predictive analytics as to where things will be based on what’s happening today, you create a very powerful, highly trusted, automated way of collaborating,” says Raj Saksena, president and CEO of Omnitrol, a provider of software solutions that provide real-time manufacturing visibility, supplier production collaboration, global asset tracking and product traceability. “That data can now be fed into business intelligence tools in the cloud where people can log in and get the status of things by taking the information as it’s delivered directly from operations.”

As 2011 progresses, look for smaller companies that might otherwise shy away from RFID to utilize the cloud as they begin their initial RFID deployments.

“When we think of the investment in RFID, so much work has to be done to build out infrastructure that it often times dissuades companies from implementing,” says Cowan. “Now that the cloud is being deployed as a way to facilitate information exchange, companies can dip their toe in the water and get greater benefit at low costs.”

For more information: john@rfid24-7.com

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