Several analysts, including IDTechEx, have recently released market research reports covering growth in the RFID industry. To sum up some of the figures, press releases from several different analysts published in the last few weeks put the total RFID market in 2010 to be either $1.5 Billion, $3 Billion, $6.1 Billion or $30 Billion. At IDTechEx, we think it will be $12.35 Billion. The lowest to the highest quoted figures are a magnitude different.
So why the difference?
We believe that much of this difference comes down to what one includes as being RFID. For example, we include everything that operates over radio frequencies and which provides identification as one of its primary functions - whether they are cards, tickets, labels or fobs; or passive or active (with battery).
We include contactless smart cards as an RFID device - they work at 13.56MHz, are standardised and spin-offs include NFC cellphone readers and smart tickets with cut down chip versions of the smart card equivalent. In 2006 about 300 million contactless smart cards will be sold across the world for transportation cards, secure access in buildings, national ID etc. Further to this about 2 billion contact smart cards (non RFID) will be sold in 2006. The contactless (RFID) versions cost just under $2 each because of their sophistication. Therefore the hardware here alone is approximately $600million excluding readers, services etc.
Similarly we include active RFID and in 2006 about 40 million active tags will be supplied in key fobs for car clicker systems. Again these are not the tens-of-cents type tags generating all the noise at the moment and they represent a fairly large but now mature market.
Few know of the largest orders actually delivered in 2005 - rather than price promises - which include 25 million tickets working at 2.45GHz to one trade fair in Tokyo. Similarly China are giving every citizen an ID card - which is RFID because it is contactless, and the deliveries will be spread out over the next 5 years. That's 1 billion cards in total, costing at least $1 each. Several European cities use ten million or more contactless tickets (about 15 cents each) each year for transportation schemes. They don't have to work at long range, collision is not much of an issue and neither is metal/fluids. In London alone, over $1.6Bn has been allotted to the contactless transport system. At IDTechEx we cover all of the RFID opportunity and the many lucrative markets that may not be well known or seem unexciting, like laundry, livestock, books, ticketing and baggage.
Maybe many in the RFID industry would not even know of the names of companies supplying these systems as they are not associated with other more mainstream RFID applications. However - that's the point - RFID is an enabling technology with many diverse markets.
EPC versus non EPC
In 2005, the market for EPC was $290 million - less than one fifth of the total RFID market. This is expected - many major European countries didn't even have a single project deploying EPC tags. However, EPC is rapidly becoming a major part of the RFID market - IDTechEx forecasts it rising to $600 million in 2006 and $5.01 billion in 2010. That includes tags, interrogators, software and services for EPC-related systems only. By tag volume, EPC will become the biggest market as tag costs are driven down. More niche markets will be profitable where tag prices can be higher because more value is demanded by the application.