By George Anderson
Consumer privacy groups can take a deep breath, say retail industry analysts, because radio frequency identification (RFID) technology doesn't work well enough for a broad rollout, even if costs for the tags were lower.
RFID tags do not yet match UPC tag reliability, in part because it is not always possible to get a clear radio signal.
"Radio frequency has some limitations. It cannot be read through liquid ... or through metal. If you have nylon conveyor belts it causes RF noise. We don't know what happens when you shrink-wrap this stuff," Kara Romanow, a senior analyst at AMR Research told Reuters.
IDC analyst Christopher Boone said, "We are at an incredibly early stage of this technology and what it is actually capable of doing. All the promise of real-time supply chain visibility is just that. It's promise."
More attention has been paid to the potential of technology ever since Wal-Mart called on suppliers to have all their products RFID tagged by 2005. Major suppliers will be meeting with Wal-Mart this week to discuss the program's implementation.
Moderator's Comment: Is the implementation of RFID technology in the next couple of years more wishful thinking than practical thought?
We understand that talk at last week's Productivity Conference was largely that manufacturers and distributors believe the widespread use of RFID is a long ways away, even if Wal-Mart is calling for it. Many openly question whether suppliers will meet Wal-Mart's deadline. [George Anderson - Moderator]