By Ann Grackin

Although there is extraordinary hype, with at least one industry show per week dedicated to RFID, it will take awhile before this turns into serious money for vendors.

Why this is so:

1. RFID passive technology is only in pilot stages now. This means demonstrations on a small scale.
2. Standard for the first push of RFID passive technologies are not fully baked, and therefore,
3. Companies are not buying ‘a lifetime’ supply of what they need.

The FUD Factor

In addition, many firms who might use this technology for business improvement are confused by the myriad of technologies and applications they might use this for. And there are very few vendors who can shed much light on what these companies should do, since the vendor community (with some exceptions) is also in pre-school.

The Market

So, ChainLink sees a slow, but healthy take-off for this market, with things starting to get really interesting post 2006.

The accompanying vendor shakeouts will occur, too. Hidden in the big picture of the market numbers is real economic Darwinism, with late adapters in serious trouble, small players who might be over leveraged (think HUGE venture capital), and some long-term technology companies who will scoop up a big share at the right time.

Many players—both technology firms and end users—have learned lessons from the past. And, as Bob Dylan says: Don’t speak too soon, since the wheels still in spin, Oh the times, they are a changin’.

©2004 ChainLink Research, Inc.