How Converters Can Make RFID Labels
Today, a growing number of companies are looking to become suppliers in the RFID label industry because of the growth potential promised by this technology. There are several paths that converters can take, as spelled out in this three-part series.
August 2006 by Dr. Peter Harrop, chairman, IDTechEx
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Part One: Low Cost Entry — Wrapping Electronics
RFID is an important enabling technology that appears in an ever-widening variety of applications. In the past, the emergence of barcodes helped create a large label market that lasted for one or two decades before people figured out how to print the barcodes directly on to packaging and products. So, today only 5-15 percent of barcodes appear as labels.
However, there are now so many barcodes required—up to 10 trillion yearly—that even the minor percentage still taking the form of labels constitutes a substantial business. This label business will endure because the labels perform special functions, like serving as a swing tag on retail apparel that would be defaced by having an easily read barcode printed on its outer surface.
Back to the future
RFID is going the same way. One day—perhaps in 2016, perhaps in 2020—RFID functionality will mostly be printed directly on to packaging and products, possibly in the trillions, and will use special electronic inks. In the universities and research laboratories, there are already many potential technologies for printing even the transistor circuit in the RFID chip. However, a large RFID label business will remain because many applications require the ruggedness or clever features RFID labels afford. During the next 15 years, the large and enduring label market may increase production to hundreds of billions of labels yearly.
Converters can participate in many ways
Participation in this business is becoming possible at various degrees of vertical integration. For example, one may take tested RFID inserts, otherwise called inlays, from a company such as UPM Raflatac. These are naked, working RFID tags and may be sourced as reels of polyester film with the RFID microchip and the antenna on top, in a repeated sequence. Most RFID labels use a chip and a connected antenna allowing them to “talk” to an electronic interrogator at a distance. This is a form of radio, thus the term Radio Frequency Identification. Doing the minimum, a converter may simply take these inserts (naked tags) and protect them with paper or plastic on either side, applied by a reel-to-reel process. These unprinted reels of RFID labels may then be sold to a customer.
Typically these labels would also feature graphics, messages, or a barcode. The labels would then be tested for electronic performance before delivery, possibly even cropping them into discrete labels. It takes know-how to wrap the delicate chip and overprint without damaging it. It takes electronic skill and equipment to test the labels at high speed while marking failures. That adds value and financial return, and many converters find this to be a profitable activity today.
RFID is an important enabling technology that appears in an ever-widening variety of applications. In the past, the emergence of barcodes helped create a large label market that lasted for one or two decades before people figured out how to print the barcodes directly on to packaging and products. So, today only 5-15 percent of barcodes appear as labels.
However, there are now so many barcodes required—up to 10 trillion yearly—that even the minor percentage still taking the form of labels constitutes a substantial business. This label business will endure because the labels perform special functions, like serving as a swing tag on retail apparel that would be defaced by having an easily read barcode printed on its outer surface.
Back to the future
RFID is going the same way. One day—perhaps in 2016, perhaps in 2020—RFID functionality will mostly be printed directly on to packaging and products, possibly in the trillions, and will use special electronic inks. In the universities and research laboratories, there are already many potential technologies for printing even the transistor circuit in the RFID chip. However, a large RFID label business will remain because many applications require the ruggedness or clever features RFID labels afford. During the next 15 years, the large and enduring label market may increase production to hundreds of billions of labels yearly.
Converters can participate in many ways
Participation in this business is becoming possible at various degrees of vertical integration. For example, one may take tested RFID inserts, otherwise called inlays, from a company such as UPM Raflatac. These are naked, working RFID tags and may be sourced as reels of polyester film with the RFID microchip and the antenna on top, in a repeated sequence. Most RFID labels use a chip and a connected antenna allowing them to “talk” to an electronic interrogator at a distance. This is a form of radio, thus the term Radio Frequency Identification. Doing the minimum, a converter may simply take these inserts (naked tags) and protect them with paper or plastic on either side, applied by a reel-to-reel process. These unprinted reels of RFID labels may then be sold to a customer.
Typically these labels would also feature graphics, messages, or a barcode. The labels would then be tested for electronic performance before delivery, possibly even cropping them into discrete labels. It takes know-how to wrap the delicate chip and overprint without damaging it. It takes electronic skill and equipment to test the labels at high speed while marking failures. That adds value and financial return, and many converters find this to be a profitable activity today.
Companies Mentioned:
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