The Gen 2 RFID Virtuous Cycle

The history of technology industries is punctuated by virtuous cycles: innovations gain traction in the market, leading to increasing capability at lower prices, further leading to broader adoption, which leads to more capability at even lower prices, and so forth. Ultimately, a technology becomes the obvious preferred choice and dominates the market for an extended period, even if competing technologies are, by some measure, technically superior. Examples of this abound, including Microsoft Windows versus the Macintosh OS, GSM cellular versus CDMA, twisted-pair copper networking versus optical fiber, and Ethernet networking versus token ring. The start of such a cycle may be happening in RFID. Passive RFID based on the EPCglobal Class 1, Generation 2 “Gen 2” standard is falling in price while gaining capabilities. It is displacing not only older technologies, such as barcode, but also newer technologies such as active RFID in a wide variety of applications.

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