RFID tags have developed quickly throughout the 2000s. Currently, optimal solutions in terms of reading distance, data transmitted and scalability can be tailored to the needs of both industry and retail.

The global market for Radio Frequency Identification (RFID) technology is estimated to reach USD 40.5 billion by 2025, driven by new opportunities in the retail and healthcare sectors.

Intelligent operations enabled by RFID, such as deliveries at the exact right time and automatic stock monitoring, are already commonplace. In the last two decades, RFID applications have spread to several industries such as retail, transport, medical, livestock, air cargo, access control, agriculture, and defence.

Two strong trends behind the development of RFID technologies

As the world moves toward Real Time Location Systems (RTLS), sensor networks, and the Internet of Things (IoT), radio frequency identification devices are anticipated to play an increasingly important role in capitalising on these technologies.

Industry 4.0 is already becoming reality on a large scale. Industry is making a beeline for IoT solutions with intelligent production processes and the connected packages megatrend. Another area going through major changes is retail, where New Retail is revolutionising the entire competitive field of retail’, says Lauri Huhtasalo, who is in charge of RFID Hardware development in the Stora Enso intelligent packaging unit.

Total RFID Market in US$ billions

There is a difference between a tag and a tag

RFID systems are composed of three major components: tags, readers, and middleware. The tags form the largest part of the RFID market. While the deployment of passive tags is the largest area, active tags are also gaining momentum as numerous new applications have sprung up in recent years and tag size has continually been reducing.

RFID tags can be grouped into three categories based on the range of frequencies they use to communicate data: low frequency (LF), high frequency (HF) and ultra-high frequency (UHF). Generally speaking, the lower the frequency of the RFID system, the shorter the read range and slower the data read rate. In addition, to read range, they differ in the number of tags read at a time.

  1. Low Frequency (LF):
    • LF systems operate in the 30 KHz to 300 KHz range, and have a read range of up to 10 cm.
    • LF systems have a shorter read range and slower data read rate than other technologies.
    • They perform better in the presence of metal or liquids.
  2. High Frequency (HF):
    • HF systems operate in the 3 MHz to 30 MHz range and provide reading distances of 10 cm to 1 m.
    • Common applications include electronic ticketing and payment and data transfer.
    • Near Field Communication (NFC) technology is based on HF RFID. A special characteristic of these tags is that they can be read using most modern smartphones. The growth of the NFC market is estimated at $47.43 billion by 2024, according to a report by Grand View Research.
  3. Ultra-High Frequency (UHF):
    • UHF systems have a frequency range between 300 MHz and 3 GHz
    • They offer read ranges of up to 12 m, and have faster data transfer rates.
    • They are more sensitive to interference from metals, liquids, and electromagnetic signals, but new design innovations have helped mitigate some of these problems.
    • UHF tags are much cheaper to manufacture
    • UHF tags are used in retail inventory tracking, pharmaceutical anti-counterfeiting, and other applications where large volumes of tags are required.

There are two other classifications of tags, depending on how the tag communicates with the reader: passive or active.

RFID tags are divided into passive and active based on whether they have their own power source or not. If the tag requires sensors in addition to product IDs, it must be active, which requires a battery.

There are two types of active tags:

  • Transponders only ‘wake up’ and transmit data when they receive a radio signal from a reader: a transponder attached to a vehicle in a toll payment or checkpoint control location would only be active when passing through a particular gate.
  • Beacons send a signal at a pre-set interval. This type of active tag is used in real-time location systems (RTLS) for tracking anything from wheelchairs at a hospital to large cargo containers at a shipping dock.

In passive RFID solutions:

  • The reader and reader antenna send a signal to the tag, and that signal is used to power on the tag and reflect energy back to the reader.
  • There are passive LF, HF, and UHF systems.
  • Read ranges are shorter than with active tags and are limited by the power of the radio signal reflected back to the reader.
  • Passive tags are usually smaller, less expensive, and more flexible than active tags. This means they can be attached to or even embedded in a wider variety of objects.
  • Passive UHF tags are commonly used for item-level tracking of consumer goods and pharmaceuticals.

A third, a hybrid type of RFID tag has also emerged. Battery-Assisted Passive systems, or semi-passive RFID systems, incorporate a power source into a passive tag configuration. Unlike active RFID transponders, BAP tags do not have their own transmitters.


Global scalability and automation on our side

Utilising RFID technology is facilitated by the fact that its standards are global, which means that tags can be read anywhere. Another great advantage of RFID is the automation of reading. Data can be read even if the tag is not visible. A large package may contain hundreds of tags, and the reader will read all of the data in a matter of seconds.

A critical prerequisite for the usability of any RFID system is reading reliability and faultless data transfer. The reading may also incorporate transactions between companies and consumers, which places further demands on data security, for example. When product lead-through is fast and the products sold are affordable, the system must also be affordable in terms of cost per unit.


IoT enables numerous new applications

The inherent value of RFID lies in enabling ‘things’ to report data in real time for faster, quicker, more interactive decisions both at the industrial level and at the consumer level.

New intelligent solutions are being created at an increasing rate, and only the sky is the limit. Tags could, for example, guide construction companies in assembling a house using prefabricated timber or elements. Tags can also be channeled to support various smart home solutions. Sensors could read moisture levels below the floor, for example, without the need to disassemble structures. Whereas reading electricity meters remotely in real time is already happening.

‘Online retail keeps offering new applications. Clothes retail, for example, involves a high rate of returns that could be gotten back on the racks quickly using tags. In terms of seasonal products, speed is key’, Huhtasalo says.

Huhtasalo says reliability, performance and competitive price are the factors that affect the choice of solution. ‘Costs have been going down for a while, which means that customers need to compromise less in terms of solution efficiency. We are also constantly looking for more eco-friendly solutions.’

RFID tags can be classified based on three things:

  1. Frequency: Low Frequency 120–150 kHz, High Frequency 13.56 MHz, Ultra High Frequency 860-960 MHz
  2. Tag communication with the reader – i.e. whether the tag is active or passive.
  3. Usage: Is the object of the tag monitoring suitcases, spare parts or daily consumer goods? Or are the tags used for gauging the conditions transportation or people in standardised indoor conditions or changing conditions?