This practice is helping companies keep track of their inventory in real time and keep down the cost of shipping and, consequently, the products. It also helps manufacturers and others keep an eye on terrorists by detecting whether anyone has tampered with products and placed them back in shipping bins unnoticed.

"Due to industry initiatives, suppliers began implementing data synchronization solutions in earnest in 2004," said Michael W. Ferro Jr., chief executive officer and chairman of Click Commerce Inc., an industrial software developer in Irvine, Calif.

"As the process of data synchronization matures in 2005, we expect a major push by retailers to begin the data synchronization process," Ferro told UPI's Wireless World.

Wal-Mart is leading the U.S. economy in the trend. The giant retailer demanded that 137 of its vendors install RFID solutions by the end of last year. The Pentagon also is a major player, demanding that defense contractors maintain a secure watch on their entire inventories.

Demands by the Pentagon, Wal-Mart and others are driving the development of label-reading technologies, something that John Pulling, chief operating officer of Provia Software in Grand Rapids, Mich., calls "technology enablers" for the RFID industry. The trend is creating a new IT communications industry and new jobs for developers and programmers.

A report by Incucomm, an industry consultancy located in Dallas, indicates there were "both failures and successes" among label-reading suppliers, but some reported a 100 percent ability to read the RFID labels accurately.

The consultants reckon demand for RFID labels will grow dramatically - from 10 million labels last year to 20 billion by 2008. About 100 million RFID labels, on everything from car parts to potato chips, are expected to be in use this year, according to Incucomm. The cost per consumer package is expected to be less than 5 cents.

In the United States and Europe, as well as across the globe, companies are collaborating to develop standards to identify each individual item in a container and automatically track it and place that information in a secure database.

For the most part, smaller entrepreneurial firms are taking the lead in developing the new shipping technologies, according to the Computing Technology Industry Association, located in suburban Chicago.

"The success of smaller firms in the RFID (marketplace) may be attributed in part to the fact that RFID is not a techno logy that many of the typical IT firms have experience working with," said Steven Ostrowski, a spokesman for CompTIA.

"This is especially true when it comes to the radio frequency side of the equation," Ostrowski told Wireless World.

"Working with the physics of RF is just not something that the majority of IT professionals have experience with. In fact, we're finding that many companies eager to deploy RFID technology have been slowed in their efforts by the scarcity of qualified RFID systems integrators. There is an industry-wide shortage of professionals knowledgeable about RFID technology."

Ostrowski explained this deficiency has opened the door for smaller firms, which are creating a successful new niche for themselves.

"One good example is ODIN technologies (in Reston, Va.), which specializes in the physics of RFID deployments and tag and product testing," he said. "Another company that is doing something out of t he ordinary is (Australian firm) InSync Software (of Melbourne), which uses a model train set at all trade shows to demonstrate how RFID works. It sounds rather simple, but I've seen first-hand the large volume of foot traffic they've generated in their booth with this demo."

To be sure, concerns remain about invasion of privacy caused by the unobtrusive RFID labels. If someone sees an RFID tag and knows it is there, that is one thing, experts said, but the labels basically have integrated the technologies and kept them out of sight - and out of mind - for many.

One concern, for example, is that a humble bag of Fritos Corn Chips might be used by food companies to track an individual's eating habits.

Last fall, Senator Bill Nelson, D-Fla., asked the Federal Trade Commission to detail its jurisdiction over RFID technologies. Nelson also asked the Federal Communications Commission to do the same thing.

The FTC replied it has jurisdiction over the technology, just as it has jurisdiction over any commercial practice that can be considered deceptive or unfair.

"If a company's privacy policy materially misstated how the company used RFID to collect information about consumers, the commission could bring an enforcement action," said Deborah Majoras, chairwoman of the FTC, who was appointed by President George W. Bush, in a written reply to Sen. Nelson. There has been privacy litigation over RFID already.

Other concerns involve the reliability of the technology, which has been demonstrated to have different levels of success with liquid or metal carton contents, and variable read rates. Companies are focusing on refining the technologies they have and are acquiring smaller firms to purchase knowledge they do not have in house.

One such example is the recent acquisition of Matrics Inc. in Rockville, Md., one of the leading RFID tag manufacturers, by Symbol Technologies Inc. of Holtsville, N.Y.

"The challenges of deploying RFID technology are evolving as end-users scale their deployments and, therefore, require more experienced solutions providers who can provide global services," Chaim Haas, a spokesman for Symbol, told Wireless World.

Other leading players include Zebra Technologies, Acsis Inc., RSA Security and Manhattan Associates. A Mobile Enterprise Consortium, made up of a number of industry firms, is conducting research into cutting-edge RFID applications.

"The noise in the RFID space is deafening," John Gibson, marketing director of PSC Inc., a data-collection technology company, said earlier this week at the ProMat trade show at the McCormick Place convention center in Chicago.

All rights reserved. Copyright 2004 by United Press International. Sections of the information displayed on this page (dispatches, photographs, logos) are protected by intellectual property rights owned by United Press International. As a consequence, you may not copy, reproduce, modify, transmit, publish, display or in any way commercially exploit any of the content of this section without the prior written consent of by United Press International.

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