Motorola's exit fails to cool RFID fervor

Motorola's exit fails to cool RFID fervor
In the postmortems that followed Motorola Inc's decision to shelve its "electronic tag" chip project, proponents of radio-frequency identification technology continue to wax bullish on the future of RFID, a tiny technology that's in search of huge volumes

A powerful university-led consortium of consumer product manufacturers said it plans to accelerate its efforts to replace bar codes with semiconductor chips on billions of products. Sponsors of the Massachusetts Institute of Technology's Auto-ID Center (Cambridge, Mass), including such manufacturing and retailing giants as Procter & Gamble, Johnson & Johnson, Coca-Cola, International Paper, Gillette and Wal-Mart, said the technology exists to place tiny IC circuits on products ranging from diaper packages to paper towels to shaving cream cans.

And in Europe, Philips Semiconductors outlined aggressive RFID projects that target everything from freshness dating on packaged foods to luggage-tracking systems that would flag any checked baggage that mysteriously "gains weight" en route.

"The vision is still for every package to have a chip on it," said Steven Van Fleet, director of smart packaging for International Paper. "Either this is going to be a tremendous success or a miserable failure. There will be no half-way implementation."

The assertions came on the heels of Motorola's admission that it has shelved its so-called BiStatix chip technology, which had been considered key to enabling the supply chain to assign unique IDs to all products.

Motorola is still interested in the technology, a spokeswoman said, but amid a downturn that forced it to lay off 39,000, the company had to make "portfolio" decisions. The BiStatix operation has been folded into Motorola Labs (Schaumburg, Ill).

While BiStatix was not a moneymaker for Motorola, MIT's Auto-ID Centre saw the technology as a leading candidate to replace the venerable bar code. BiStatix used an ink-based antenna that could be printed on paper, boxes and cardboard packages for less than 30 cents apiece.

If it had succeeded, BiStatix might have enabled companies throughout the supply chain to stem billions in losses from theft and counterfeiting, vendors said. Because the BiStatix chips were programmable, every product could have been assigned an identifier that would have let computers track its progress through the supply chain.

But at the Frontline Solutions Expo in Chicago two weeks ago, competitors questioned the performance of the BiStatix technology. Most claimed the broadcast distance of Motorola's RF technique had proved problematic. BiStatix readers needed to be placed within 2 to 3 inches of the device's antenna in order to read data, they said.

Observers also questioned whether Motorola's tags would ever have reached their cost goals. RFID "is not going to replace bar codes in the foreseeable future, because you can't get any cheaper than a bar code right now," said Mike Liard, an analyst who tracks the automated ID market for Venture Development Corp (Natick, Mass).

Read and write

Despite Motorola's travails, sector observers say the RFID market remains robust for companies that can make a strong cost/value proposition.

One key to understanding an RF tag's added value is that the technology allows information to be written to the tag as well as read from it, said Karsten Ottenberg, senior vice president and general manager of business unit identification at Philips Semiconductors in Hamburg, Germany. The Dutch giant, which says RFID is one of its fastest-growing segments, has been engaged in a number of RFID projects, including the tracking and tracing of chilled foods at major UK retailer Sainsburys; a baggage-handling trial with British Airways; and a new project with the Singapore National Library Board that envisions RF tagging of every book in the country's public library system to expedite checkouts and returns.

The trial with British Airways involved 75,000 suitcases traveling with passengers from Munich, Germany, and Manchester, England, to London's Heathrow airport. The "smart-bag tags" contained Philips' I-Code IC, which can be programmed with an ID number as well as such detailed information as check-in date and time and the passenger's destination. The chip was placed between the layers of the paper baggage tags now used by the airlines and was attached to an antenna, also housed in the label, for communication with the scanner via radio signals at a distance of up to 1.2 metres. Because smart labels use RF for communication, they do not require a direct line of sight.

The technology allows several smart labels to be scanned simultaneously and permits tag information to be changed without the need to print and attach a new label. One could record the weight of a piece of luggage on the smart tag at check-in, for example, and reweigh the bag as it travels from gate to gate; any change would raise a red flag of possible tampering. Airlines would no longer have to rely on human screeners after check-in.

Safety track

In the Sainsburys project, smart labels are attached to crates and programmed for such logistics and product information as product number and "sell-by" date. When tagged crates come into the distribution center from chilled-food manufacturers, their tag information is logged on the regional distribution computer. Later, their storage position within the warehouse is automatically uploaded.

In a country still reeling from several well-publicised cases of bovine spongiform encephalopathy ("mad cow disease") that were traced back to the victims' ingestion of infected beef, the smart-tagging system's ability to track products throughout the supply chain is seen as one way to expedite recalls of tainted food.

Proponents of RFID technology thus insist that its potential benefits outweigh any negatives. They acknowledge BiStatix's technical shortcomings but say that most of those were caused by Motorola's unwillingness to invest in further development.

More important, engineers said BiStatix was only one of several emerging technologies that offer promise as bar code replacements. The loss of a single chip supplier isn't critical, they said, because the scope of the project calls for a large vendor base. "If you're going to go to the Wal-Marts of the world and put a smart shelf in their stores, then you can't hold them hostage to a certain chip," International Paper's Van Fleet said. "No one is going to install that much infrastructure to read one kind of chip."

Emerging alternatives include silicon from Alien Technology Corp (Morgan Hill, Calif.) and low-cost antennas from Rafsec USA (Westmont, Ill), which is owned by Finland-based UPM-Kymenne Corp.

In a recent technology demonstration at the Auto-ID Centre, Alien engineers previewed a passive (no battery) 900MHz RFID system based on the company's low-cost ICs. The chips were attached to the packaging of such consumer products as shampoo, soap, razor blades, paper towels, shaving cream and six-packs of Coke. Data was reportedly read across a distance of 2 to 3 feet.

Plausible numbers

Engineers said Alien's technology promises to cut the cost of RFID chips to as low as 5 cents apiece. That's a significant breakthrough, they said, because most of today's RFID products run closer to $1. While the 5 cent figure is based on extraordinary volumes of 10 billion or more chips, such projected numbers are not unrealistic, backers said.

"The Auto-ID Centre members alone account for 550 billion items a year," noted Tom Pounds, vice president of RFID products for Alien Technology. "Based on that scale, 10 billion sounds like a plausible number."

The key to Alien's low cost, Pounds said, is an IC fabrication process known as fluidic self-assembly, whereby extremely small semiconductor devices are suspended in a liquid and flowed over a silicon surface containing corresponding holes into which the devices settle. The devices and holes are pre-shaped so that the ICs not only settle but self-align, thus allowing them to be electrically connected to RF antennas.

The FSA process is said to eliminate the traditional pick-and-place assembly methods used today and thus dramatically reduces the size of the ICs that can be packaged. Alien engineers say they can cut device size by an order of magnitude. RFID ICs measuring 350 microns square are feasible, they say.

Alien plans to provide FSA-processed chips to partners such as Rafsec, which will integrate them with its antennas and ultimately convert them to smart labels. Some Auto-ID sponsors said they are hopeful Rafsec can provide antennas at a cost of around a penny apiece. Rafsec declined to comment.

Other chip vendors and manufacturers of RFID readers are said to be gearing up. International Paper's smart-packaging effort has already demonstrated a multifrequency, multichip reading device. "We want to be technically agnostic," Van Fleet said, "so we have readers here that work with Philips chips, SCS chips, Intermec chips and others. We'll be moving about 60 billion packages a year if this gets cranked up, so it behooves us to have relationships with a lot of suppliers."

Philips Semiconductors' Ottenberg pointed out that the cost comparison between bar codes and smart RF tags needs to be made not just on the chip level but also from the standpoint of total system cost, including reader equipment.

"Today we can make a ready-to-use smart-tag chip at 30 cents," he said. In a library, for example, he said, "It's possible to make a very cost-effective handheld reader device. Librarians can just walk through aisles in a library with the portable reader device in hand to find misplaced books on shelves."

Ottenberg said that etching is used to bring a coil structure to the inlet substrate. Chips are attached to the coil so that the two bond pads connect with the two corresponding ends of the coil. The chip contains the functionality to connect the I/O through the coil, he said.