 | Thursday, March 17, 2005
Issue 80 | | Will Smith, Editor |  |
 | RFID Pharmaceutical Focus
March 30-31, 2005 - Philadelphia, PA
Gain knowledge on how to incorporate RFID into your drug
distribution, with minimum cost and maximum increase in
efficiency and cost savings throughout your supply chain.
For more info call 212-621-4978 and use code RFIDBNR.
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| Upcoming RFID Events | | - RFID Networking Forum, 5 May 2005, London Heathrow, UK | | - RFID4U.com - RFID Training Classes | | - Chemical Week's RFID Pharmaceutical Focus, Mar 30-31, Phila, PA | | - EPC Developers Conference – April 10 – Chicago, IL | | - Pharma Supply Chain Summit, June 6-8, 2005, Philadelphia, PA | | - RFID World Asia 2005, 27 - 29 April, Suntec Singapore | | | RFID Research and Knowledge | | - RFID Knowledgebase - 10% Off for RFID Update Readers | | - Have RFID questions? Ask the RFID Talk experts. | | | Employment in RFID | | - RFID Talent – Operations, Business Development | | - RFID Recruiters - 100% Focused on RFID Recruiting | |
Symbol vs. Intermec, "Clash of the Titans"
The upcoming legal battle between the old adversaries was characterized as nothing less by Imperial Capital's Vice President of Research, Kevin Starke. With both Intermec and Symbol coming off years of successfully prosecuting a slew of patent cases (Intermec for its smart battery, Symbol for its laser-scanning), their legal teams are seasoned and primed for an all-out brawl.
The import of this case’s outcome for the near-term development of each company’s RFID fortunes cannot be overstated. It will serve as a test of whether Intermec’s intent to charge royalties for use of fundamental RFID technology will succeed. Many believe that it will. Intermec’s portfolio of 100-plus RFID patents is reportedly tight and defensible. (As it should be, given that the original author was patent powerhouse IBM, from whom Intermec obtained the patents in a deal dating back to the mid-90s.)
But despite this strong position, the stakes for Intermec are huge. A failure to realize value from its RFID patent portfolio, in which it has invested dearly, would be devastating. “The stock price would halve,” says Starke.
Symbol, on the other hand, will fight hard to prevent paying Intermec ultra-steep 7% royalties on its line of RFID products. Such fees make the overall prospect of competing in RFID substantially less attractive, and Symbol already has a lot invested in being an RFID leader: namely, $230 million for the September, 2004, purchase of Matrics. The Matrics acquisition notwithstanding, Symbol simply must be a player in RFID if you accept, as most do, that RFID will ultimately replace the company’s cornerstone technology, the barcode.
Patent cases are notoriously hard to predict, but whatever happens, this much is certain: the outcome of this case will affect not only Symbol and Intermec, it will reverberate throughout the entire industry. Readers would be advised to follow it closely.
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Intermec's Fees are the Real Complaint
For those that have been following the developments surrounding Intermec's intention to charge licensing fees for fundamental RFID technology, it may be hard to determine which side has the more valid argument: Intermec, or the rest of the industry. On the one hand, many are irate that Intermec would selfishly seek royalties, since this will keep RFID prices higher and impede adoption at a formative moment for the industry. On the other hand, it seems perfectly reasonable that a company try to extract value from its portfolio of intellectual property. This isn't charity, after all.
According to those we spoke with, the problem is not so much that Intermec wants to charge royalties; it is how much Intermec wants to charge. Typically, anywhere from 1% to 3% would be charged in similar licensing scenarios. Intermec is reportedly seeking 5% to 7%, which is staggering. At costs that high, many in the industry have simply panicked, particularly those companies whose products rely heavily on RFID technology covered by the Intermec IP in question.
Still, most in the industry will concede that Intermec should not be expected to simply give away the intellectual property in which it has invested so much. (When pressed, some even allow a bit of admiration for the company which, in the face of so much abuse and scorn, has stuck to its guns.) The question is, will Intermec bring its licensing fees down to less onerous levels? Only time will tell. Now that the company has withdrawn its commitment to license on a RAND (reasonable and non-discriminatory) basis, it could conceivably do just the opposite, raising prices to its competitors or even forbidding them from using the IP at all. That is what has some really worried. Indeed, an unwillingness to compromise on its high licensing fees may have been the sticking point that drove Symbol last week to walk away from the negotiating table with Intermec and sue.
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IDC: Corporate Networks Must Prepare for RFID Data Flood
Research firm IDC released a Cisco-commissioned report that emphasizes the upcoming assault on corporate networks from the flood of data created by RFID implementations. As the number of RFID-tagged items and read points are deployed throughout an enterprise, the amount of data created will likely bog down existing systems, which were not designed with RFID in mind. Furthermore, RFID deployments will no doubt "creep" over time, so that the number of tags and read-points will increase steadily well into the future. IDC therefore recommends not only preparing existing networks for the anticipated near-term RFID-generated data spike, but also designing the networks to be scalable so that they can be expanded easily to handle the unpredictable RFID-creep years down the line.
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New Consumer Product: RFID Tag "Zapper"
Ever since RSA Security announced it had patented an RFID tag "killing" process, we knew a product such as the TagZapper! was right around the corner. It is nothing more than a simple handheld device that deactivates any RFID tags you might be carrying on your person. According to the website, it is "intended to fulfill consumer demand for a means to protect their privacy." The product is apparently not yet available, and the site provides no indication of when it will be released. For the truly impatient, management@tagzapper.com is provided as a contact.
"TagZapper, for the Katherine Albrecht in all of us."
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U.K. Pharma-Tagging Pilot a Success; Nationwide Roll-Out to Follow
A three-month pharmaceutical tagging pilot has completed in the U.K. with successful results, according to Aegate, the lead technology provider of the initiative. The pilot, in which 180,000 bottles of medicine were tracked, was meant to test whether RFID tagging could significantly cut down on pharmaceutical counterfeiting. Some estimates put the annual cost of counterfeiting to the pharmaceutical industry as high as $68 billion. Owing to its success, the tagging initiative, dubbed Authentication at the Point of Dispensing, will be expanded throughout the U.K., possibly within the next 12 months.
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| Upcoming RFID Events | RFID Networking Forum, 5 May 2005, London Heathrow, UK
Europe's leading RFID event brings executives together to gain knowledge, share RFID experience, gain competitive advantage and deliver ROI. Includes interactive roundtables, superb peer-to-peer networking and hundreds of movers and shakers in RFID. RFID Update exclusive discount -- Register now! | RFID4U.com - RFID Training Classes
RFID4U offers training all over world - both e-Learning and instructor-led courses. The next one day course - RFID Made Easy - is March 17th in Sunnyvale, CA and March 23rd in Phoenix, AZ. Over 350 individuals already trained. Open registration and 10% discount for RFID Update readers. See more, Click Here! | Chemical Week's RFID Pharmaceutical Focus, Mar 30-31, Phila, PA
RFID Pharmaceutical Focus is your opportunity to learn from and network with peers. Gain knowledge on incorporating RFID into your drug distribution with minimum cost, maximum increase in efficiency, and cost savings throughout your supply chain. For more information or to register, visit www.chemconference.com or call 212-621-4978. Mention code: PME1 | EPC Developers Conference – April 10 – Chicago, IL
An Evolution in the Making. Unlocking the Next-Generation Supply Chain with EPC. A conference for leaders capitalizing on RFID and EPC technologies, featuring breakout tracks for business and technical professionals and presentations from IDEO and EPCglobal. Register Now. | Pharma Supply Chain Summit, June 6-8, 2005, Philadelphia, PA
The Only Supply Chain Event to Focus on Integrity, Efficiency & Security Progressing from Theory to Implementation. Increase the efficiency of your inventory management, avoid redundancy and maximize material velocity to increase productivity. Learn from retail pharmacy chains, RFID case studies, 65 industry experts and networking opportunities. Email register@iirusa.com, call 888.670.8200, or visit: www.traxsummit.com | RFID World Asia 2005, 27 - 29 April, Suntec Singapore
Terrapinn's 2nd annual RFID World Asia 2005, taking place 27-29 April in Singapore, is established as THE event in the region to feature case studies from leading end users who are implementing RFID. If you want to know how RFID will impact your bottom line, Register Now! | | | RFID Research and Knowledge | RFID Knowledgebase - 10% Off for RFID Update Readers
Don't do anything until you have consulted the world's largest database of RFID in action. More than 1250 case studies covering over 1400 companies. Save time and money, improve forecasts, convince doubters, help you raise investment. Sign up using the promo code "rfidupdate" to receive a 10% discount off your annual subscription. | Have RFID questions? Ask the RFID Talk experts.
A proud partner of RFID Update, RFID Talk is the industry's leading discussion forum. Join thousands of users at RFID Talk and stay on the forefront of technology, deployment, standards, specifications and more. Free, quick registration - Sign Up Now! | | | Employment in RFID | RFID Talent – Operations, Business Development
You face RFID market entry decisions -- when, how, and what technology –- that should be entrusted to a proven industry leader. This GM/evangelist who positioned his company for envious ROI is making a discreet career change. Is your challenge attractive enough for him? RFID Careers – Jack Bourque at jjb@wirelesscareers.com or 860-738-5035 ex:23 | RFID Recruiters - 100% Focused on RFID Recruiting
Whether your company is looking for the best RFID talent or you have the best RFID talent and are looking for the best RFID employer, RFID Recruiters offers the most focused approach to your objective. To learn how the RFID industry and the RFID job market are evolving, click here! |
About RFID Update - Launched in early 2004 to provide timely analysis of RFID industry news, RFID Update publishes editorial briefings every Monday and Thursday for the growing ranks of top level executives involved in the deployment of RFID projects. Each issue distills the impact of global RFID developments by providing an analytical summary of the news and issues most pertinent to successful RFID implementations.
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