ABI Research Sees Strong Growth for RFID

ABI Research sees continuing strong growth potential in RFID markets worldwide.

It forecasts a total market size of about US$4.6 billion by the end of 2010 for RFID systems (hardware, software, and services). The total reaches US$5.5 billion when hardware-only shipments to support automobile immobilization are included.

By the end of 2011, global RFID system markets (excluding immobilization) are expected to amount to almost US$5.3 billion, a year-over-year growth in excess of 16 percent. RFID systems software revenue will outpace that from services, transponders and readers. When automobile immobilization is included the total market size is approximately US$6.2 billion, representing 13 percent growth next year.

Hotspots include:

* Massive retail deployments: "Item-level apparel tracking is probably the biggest area to watch in 2010-2011 and beyond," ABI noted, "especially due to Wal-Mart's 'jeans and basics' tagging announcement." JCPenney, Marks & Spencer, and American Apparel among others remain key retailers to watch given their existing programs and deployment plans.

* Asset tracking and management: Asset tracking and management applications continue to gain momentum in verticals including healthcare, manufacturing (particularly the aerospace and defense sector), transportation and logistics.

* An explosion in passive UHF transponders: ABI Research expects to see a CAGR of 74 percent in passive UHF transponders from 2010 to 2014 thanks to burgeoning demand within key applications such as retail apparel tagging and asset management.

* Regional performers shine: the "Rest of World" region, which includes the Middle East, Latin America, South Africa and others, currently comprises only seven percent of the overall RFID market but it is expected to adopt RFID solutions faster than any of the more industrialized regions. This is due to increased focus on using RFID in the Middle East in the oil and gas space and for construction; in Latin America for animal ID, food safety, and retail; and in South Africa for RTI, among others.