Gartner predicts that worldwide radio frequency identification (RFID) revenue will eclipse US$1.2 billion (NZ$1.48 billion) this year, marking nearly a 31% increase over last year.
Global RFID revenue in 2007 hit US$917.3 million, and will hit US$3.5 billion by 2012, Gartner analysts predict in a recent report.
"The market for RFID technologies has begun to transition from being compliance-oriented to being revenue-generating and innovative," says Gartner analyst Chad Eschinger.
"Early adopters faced tight profit margins and pressed technology providers for lower hardware costs. Fortunately for the market, this trend has waned and innovation rather than cost is becoming a key driver for adoption," Eschinger says.
Forced adoption to comply with new regulations was a key driver in pushing the RFID market ahead, according to the report. Interest in asset management projects — particularly in-store inventory management — is driving the growth today.
Now, according to Gartner, the RFID market is heading into its second wave of adoption. Businesses are moving away from their initial pilot programmes and are dipping their toes in what Gartner is calling the "exploration phase".
"While the interest for RFID technologies is high, today's buyer is more discriminating than in the past and cautious of over-hyped technologies," says Eschinger. "They will be looking for greater functionality and return on investment."
Earlier this month, Ford announced that it is diving head-long into RFID, embedding the technology in its pickup trucks and vans. It's being set up to tag and track tools, construction equipment and materials, so the vehicle's owner can use an in-dash computer interface to make sure everything he needs is actually in the vehicle.