New Study Shows Strategic Shift of RFID Hardware Vendors

New Study Shows Strategic Shift of RFID Hardware Vendors

LONDON, October 11/PRNewswire/ --

- Europe Takes More Balanced Cross-Industry Approach Than North America

A new in-depth study into the Radio Frequency Identification (RFID)
market shows a remarkable shift of industry focus from European RFID vendors.
Until 12 months ago, most vendors were targeting the open supply chain
applications in the retail industry, hoping to capitalise on the potential
high volume of RFID tags and readers in these applications. Since then, many
vendors have broadened their focus and begun targeting opportunities in other
market segments.

Despite a converging set of standards for North America and Europe, the
focus for RFID implementations is very different on the opposite sides of the
Atlantic. North America continues to view the technology as key for the
retail and defence sectors, a perception driven by companies such as Wal-Mart
and the US Government. But Europe is starting to recognise the wider
applications for the technology in areas such as logistics, aviation,
healthcare and the pharmaceutical industry.

The study, undertaken by LogicaCMG's RFID centre of excellence, shows
that the uptake of RFID in Europe has been boosted since the European
regulations were changed in 2004 to allow tags in the Ultra-High Frequency
(UHF) range to operate with similar performance as in North America(1). The
new regulations, in combination with the new EPC Gen2 standard, have led to
more than two-thirds of hardware vendors saying they now create RFID
technology that works in both regions. A significant range of products has
been developed this year and as a result through 2006 UHF technology will be
implemented in an increasing number of business applications.

Paul Stam de Jonge, group director RFID solutions at LogicaCMG, said:
"The current UHF RFID marketplace is still at a very early stage, but over
the next 12 months we will see a growing number of large-scale
implementations as the technology continues to mature. Currently, application
specific solutions are not generally available, but over the next 12 to 24
months, as the experience of the current RFID pilots and implementations are
translated into integrated solutions, we expect this situation to change.
While there are still improvements to be made and prices need to drop, with
the new European regulations and the creation of the Gen2 standard, the
market has clearly found an environment that is ready for a wide range of
business scenarios."

The study shows that there is no dominant hardware vendor for UHF
technology and that this landscape is complex for end-users. Since the market
is relatively immature, it consists of a great number of companies that focus
on specific hardware components, none of these currently provide end-to-end
solutions that combine the required hardware and software components.
Hardware vendors agree that system integrators are the natural choice to take
ownership of the integrated solution for the customer.

LogicaCMG's RFID centre of excellence conducted the study over a
six-month period, combining a survey of RFID hardware vendors, thorough
analysis of current literature on the European market and in-depth interviews
with end-users, hardware vendors and industry bodies. This study follows the
comprehensive research LogicaCMG conducted into RFID usage in returnable
transport items, published in April 2004.

To view the full survey please click here
http://www.logicacmg.com/reg/index.asp?fid=12&sec=0

1. Until recently, UHF RFID technology in Europe hardly existed. The
European regulations restricted the power used by UHF RFID readers to such an
extent that many useful applications were prohibited. Instead, the market for
RFID in Europe has been focused on low-frequency (LF) and high-frequency (HF)
technology. With a read range of less than one meter, these technologies are
widely used in public transport systems and access control, but are not
suitable for larger scale implementations.

NOTES TO EDITORS

About the research

This analysis combines three elements:

- a literature study (overview of sources available upon request)

- a survey questionnaire for RFID hardware vendors

- qualitative in-depth interviews with end-users, hardware vendors
and industry bodies.

A total of twenty manufacturers responded to the questionnaire in
February and March 2005. These manufacturers were selected based upon their
ability to provide UHF-related RFID hardware for use in Europe, and included
vendors of RFID chips, tags, readers and printers. These manufacturers
represent the majority of the European market for UHF RFID technology, and
together provide a good picture of the expected availability and trends in
Europe. The follow-up interviews with end-users, hardware vendors and
industry bodies were conducted in the summer of 2005.

About LogicaCMG

LogicaCMG is a major international force in IT services and wireless
telecoms. It provides management and IT consultancy, systems integration and
outsourcing services to clients across diverse markets including telecoms,
financial services, energy and utilities, industry, distribution and
transport and the public sector. The company employs around 21,000 staff in
offices across 35 countries and has more than 40 years of experience in IT
services. Headquartered in Europe, LogicaCMG is listed on both the London and
Amsterdam stock exchanges (LSE: LOG; Euronext: LOG). More information is
available from www.logicacmg.com

Source: LogicaCMG Plc

Press Contacts: Isabell Horvath, +44-(0)-20-7446-1259, mobile: +49-(0)-171-6546152, isabell.horvath@logicacmg.com; Matt Harris, +44-(0)-20-7419-7000, matt.harris@bbpr.com

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