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Research firm lowers revenue projection for 2007 RFID market

Posted: 15 Aug 2006 ?? ?Print Version ?Bookmark and Share

Keywords:ABI Research? RFID? XX? XX? XX?

Citing consolidation among vendors, lower prices and smarter users spending less as reasons, ABI Research recently dropped its 2007 revenue projection for RFID software and services by 15 percent.

In lowering its forecast for the RF identification market to $3.1 billion, ABI said there were four interrelated factors, particularly within the asset-management and supply-chain-management markets. The factors were market consolidation, collaborative solutions, the growing availability of off-the-shelf commercial RFID software packages, and the improving level of skills in RFID project planning.

Consolidation among vendors and service providers was expected to eliminate significant overlap and lead to better-managed, more efficient solutions, ABI said. Also, as RFID technology becomes more standardized, "ecosystems of partners" would form, with each company contributing elements to a common set of products and services.

Users, therefore, were expected to spend less, since the vendor partnerships would remove the need to seek technology and consultation from multiple sources, the research firm said.

Revenues would also be lowered by the availability of more off-the-shelf software packages, which are less expensive then custom software. Finally, companies' project planning skills were expected to improve, as they gain experience, lowering the overall spend for RFID implementations.

"'Install in haste, repent at leisure' used to be a common pattern in growing RFID deployments," Michael Liard, RFID practice director for ABI, said in a statement. "But with today's better planning, there's less waste, and less software needing premature replacement. End users are taking a more managed approach to budgeting and integrating RFID solutions internally."

- Antone Gonsalves

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