Seven companies on Monday announced the formation of a nonprofit organization called the Smart Active Label Consortium. The group, consisting of representatives from Infinite Power Solutions, Cymbet, Graphic Solutions, KSW Microtec, Parelec, Cryovac and Power Paper, incorporated its operations, approved bylaws, adopted a new membership and dues structure, and set a schedule for its first election of officers.
The group will work on determining what frequency smart labels should use, making sure there aren't any interoperability issues and raising market awareness of smart labels, to help speed up acceptance of the technology, according to consortium spokesman Andy Freed. The consortium will talk about other details at the Smart Labels USA 2003 conference in Cambridge, Mass., next week. Smart labels are thin, flexible labels that contain an integrated circuit and power source that can remotely send data to supply chain networks and improve real-time inventory tracking.
The labels are a subset of radio frequency identification (RFID) technology. RFID systems have been touted during the past several years as a potentially major advance in giving people the means to track the movement and location of supplies as well as identify particular shipments.
"Smart Active Labels will lead the way for the RFID industry to become bigger than the plastic credit card and smart card industry," Baruch Levanon, the interim chairman of the consortium, said in a statement.
The market for RFIDs is estimated to be $700 million in revenue and is expected to grow to $2 billion by 2007, according to research firm VDC.
VDC analyst David Krebs said that one of the major limiting factors of RFID is the lack of standards and little support from retailers.
"Unlike with bar-code scanning, there hasn't been a major retailer who has required its partners to include RFID in their products, so it's been slow to take off," Krebs said.
Retail clothing chaintechnology to its supply chain management system, and have tested the technology.
It took bar-code scanning decades to become established in the retail market, according to Krebs.