Happy New Year! On behalf of the AutoID team and all of VDC Research Group, we wish you all the
best in 2013.
Although 2012 has just concluded, it is never too soon to look ahead. So to start the new year off in an interesting way, the AutoID team has taken out our crystal ball once again to offer 13 predictions for the AutoID market in 2013, including Barcode, RFID & RTLS and Mobile Consumer Engagement Technologies (MCET). They are presented in no particular order.
- Barcode: More market aggregation ahead – Expect continued consolidation of the barcode
hardware landscape, particularly to achieve growth across following dimensions:
- Regional – Vendors seeking to grow their presence in emerging country markets,
particularly targeting barcode printer and scanner vendors based out of
- Vertical – Vendors looking to increase their proliferation into high-growth industry
verticals – particularly healthcare.
- Regional – Vendors seeking to grow their presence in emerging country markets,
- Barcode: Vendors will learn to “accessorize” – More barcode hardware players will actively
look to enter the “accessories” market – developing sleds and/or sleeves to support consumer-grade device usage in enterprise environments. This is particularly relevant to vendors addressing customer-facing applications with their devices in retail, healthcare, hospitality and commercial services.
- Barcode: Future with mobility, not without in software market – An increasing number
of barcode software solution providers will extend label printing support to portable devices (both purpose-built and consumer-grade) – facilitating mobile applications such as field sales, field service and direct store delivery (DSD). Today, mobile barcode label generation software penetration is in a very nascent stage, but we expect that to quickly change. Mobility IS the way forward across verticals and industries and the entire barcode value chain must and will respond accordingly.
- Barcode: Embrace the tech-savvy consumer – Scanning with and displaying barcodes on mobile device screens will continue to grow significantly among consumers. Barcode vendors and their enterprise and retail customers must continuously adapt to this explosive trend. We predict more QSRs (quick service restaurants), convenience stores, restaurants, theme parks/ entertainment venues and other consumer-facing enterprises will invest in and deploy barcode imagers and consumer-grade mobile devices to interact with consumers (e.g., coupon redemption, payment, loyalty/rewards programs).
- MCET: Mobile point-of-sale (mPOS) will remain the hottest technology among B2C business operators – This trend will be most prominent in retail, but increasingly in dining as well, despite the fact that enterprises often lack clear strategic objectives guiding their investment in the same. In 2013, MCET solution providers must assume leadership roles in educating their customers on technology selection, software and security, best-fit use cases for specific mobile devices/form factors and total cost of ownership (TCO).
- MCET: NFC as a broader ecosystem will make little progress beyond incremental gains in
shipments of NFC-enabled smartphones – Yes, this means more NFC-equipped phones in consumer hands, and limited scale pilots and tests will continue, but 2013 is not the year when the technology gains global-level traction. However, expect more TV commercials for mobile phones and mobile network operators (MNOs) to advertise NFC and its applications – and more importantly, look for more commercials to specifically mention the term “NFC” in order to engrain the technology in consumer minds.
- MCET: Merchants’ general focus on mobility - mPOS in particular - will bring great opportunity for vendors of adjacent peripherals – POS peripheral vendors (e.g., receipt printers, barcode scanners, payment solutions) are expected to drive growth via innovative, highly-portable versions of these traditional POS extensions. These vendors will be jockeying for competitive position more aggressively in 2013, responding to burgeoning demand among retailers, restaurants, hospitality and other enterprises wanting to differentiate and augment their systems by “going mobile” at the POS.
- MCET: Contactless mobile payment via NFC will not explode in popularity among consumers during 2013, but consumer usage and merchant support of this application will experience strong growth – Barcodes displayed on mobile device screens and core/traditional RFID (e.g., contactless tickets, smartcards) – not NFC – will continue to enjoy broader global support for mobile payments in the foreseeablefuture. For NFC to gain ground in 2013, more NFC-enabled devices must reach consumer hands, more NFC-compatible payment terminals must be deployed and more collaboration among invested parties must occur within the NFC ecosystem (especially in terms of consumer education, transaction fee negotiations/resolution, and application development).
- RFID & RTLS: Vendors – especially RTLS solution providers – will develop the “healthcare
stare” – The use of RFID and RTLS is on the rise in healthcare, most notably in the US thanks to the VA’s announced $540M+ contract to track equipment and supplies at 21 of its Veteran Integrated Service Networks (VISNs). However, the contract award to HP was not met without controversy in 2012 as IBM filed a protest to the US Government Accountability Office (GAO) and won the decision. The contract will be rebid among, at least, the six original bidders. This spark to the market (and sizeable contract) drew a lot of attention in 2012 and we expect the RFID and RTLS frenzy to continue in healthcare in 2013. However, we caution vendors (especially RTLS providers) to not focus solely on healthcare and to seek opportunities and market development in other vertical markets where the competitive field may be less crowded.
- RFID & RTLS: Passive UHF EPC item-level tagging (ILT) in the apparel sector will
pick up the pace after a somewhat slow 2012 – This past year was a mild disappointment in terms of retailer deployment of RFID for ILT of apparel. For example, no major reader or printer/encoder orders were delivered, several large retailers remain behind originally announced plans (e.g., Wal-Mart, JC Penney) and some newer programs were pushed to or will start in 2013. So what to expect in the year ahead? Even more American Apparel stores will go live with RFID (a bright spot for 2012 as well), Wal-Mart will reassess its RFID plans but remain committed, Macy’s will make its anticipated move, JC Penney has bigger worries than RFID, international retailer Zara will play a key role in increasing tag volumes and RFID EAS will become a more critical part of the ILT in apparel conversation.
- RFID & RTLS: Embedded RFID keeps the forward momentum – At the end of 2011 we
noted the rise of “RFID inside,” or embedded RFID, as a key trend to watch for in 2012. We are keeping it on the list in 2013 after seeing a great deal of progress in 2012. For example, ThingMagic released a new, smaller passive UHF reader module, Xerafy continued product development for embedded RFID specialty tags (e.g., tools), ICs and chipsets from players such as Impinj, NXP, Murata and AMS decreased their footprints, Coca-Cola Freestyle dispensers with passive UHF technology inside continued deploment, RFID and NFC made their way into consumer devices such as Keurig Vue coffee brewers and Nintendo Wii (Skylanders game) and much more. With price points declining and form factors shrinking, we expect to see solutions and applications such as these expand and new innovations to be introduced in 2013.
- RFID & RTLS: Honeywell Scanning & Mobility will get strategic on RFID – and quickly
– after announcing its first RFID product and the acquisition of Intermec in 2012 – After some exploration of RFID while acquiring several barcode scanner and mobile computing companies over the last few years, Honeywell made some eye-catching RFID moves in 2012. They made a subtle move in introducing an RFID reader and then made a major move in announcing the acquisition of Intermec (a major RFID IP holder and RFID equipment manufacturer). We predict Honeywell will aggressively develop its RFID strategy in 2013, becoming a strong competitor in select verticals and applications that play to the combined strengths of Honeywell and Intermec. What’s next for Honeywell – RTLS in 2013 or 2014?
- AutoID: Governments in China and the EU continue to connect with the concept of the Internet of Things (IoT) – While the US government remains largely silent, China and
the EU actively fund research IoT projects, create policies to govern the IoT and deploy IoT technologies (including RFID, NFC and sensors). Much of the IoT activity in the US has been at the city level (e.g., smart cities) and we do not expect that to change. In looking ahead and predicting where will be the epicenter of IoT innovation, we are placing our bets on China. Simply look at what is on the list of IoT development subsidy projects from China's Ministry of Industry and Information Technology and Ministry of Finance (announced November 2012). UHF and microwave RFID chip design, product technology R&D, miniaturized intelligent sensor technology R&D, ad-hoc networking technology for wireless sensor networks, intelligent logistics and intelligent traffic are among the 14 categories of project, comprising 149 projects in total, which will receive support from the government.
I would like to extend a special thank you to Richa Gupta (VDC’s barcode analyst) and John Shuster (VDC’s MCET analyst) for their contributions to this blog.