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Posted On: 04/20/2005

Suppliers Partner to Keep Up With RFID Demand

RFID mandates are now moving beyond Wal-Mart to businesses such as Target, Albertsons, and Best Buy, as well as Tesco and MetroAG.

For each of those mandates there have been small RFID-centric companies that have been developing UHF RFID products. According to Erik Michielsen, ABI Research's director of RFID and ubiquitous networks, these small companies have built good business in RFID's early stages, and are continuing to educate the market and to provide innovation, personnel and research.

To help serve this market as it grows, many of the most significant RFID vendors and integrators are forging solid partnerships with these smaller, more agile developers. These partnerships are explored in the latest edition of ABI Research's "RFID Research Service," which dissects the RFID industry using a three-tiered approach based on a deep understanding of the relationship between technologies, markets and competition.

So we see, for instance, an OAT Systems partnering with Symbol Technologies, ADT and Hewlett-Packard. Acsis is another example, with its relationships with SAP and HP, Symbol and Intermec.

"These small companies can bring great value to the table," says Michielsen. "They are in a great position to complement their larger partners' skill-sets in broader areas such as enterprise resource planning, warehouse management systems or automatic data capture. They really understand RFID at the network edge and are now partnering with larger organizations that provide more enterprise focus, more company-wide integration services and global customer support. Not only do these smaller companies' products win accolades from end-users, but they themselves have end-user relationships, from earlier work on smaller projects. They must be taken seriously."

But partnerships may only be a way-station for RFID vendors. ABI Research forecasts that out-and-out acquisitions will become more common, and there will be major consolidation as larger vendors better understand where these small companies fit into their portfolios.

For more information, contact ABI research at (516) 624-2500 or www.abiresearch.com.