Sloan Information Period SIP RF 450 Information Infrastructure

Sloan Information Period (SIP) RF. 450 Information Infrastructure Needed for Effective Utilization of RFID Auto. ID technologies Part 1 – RFID Technology & Application Areas Subject RF. 450 @ E 51 -145 on Monday , Oct 24, 2005 at 2: 30 -5: 30 PM Abstract: This is an exploratory research SIP activity. A high degree of interaction and student participation and discussion is expected. In order to maximize the effective use of RFID, existing intra- and inter-organizational business processes must be re-thought and restructured, and an appropriate Information Technology (IT) infrastructure must be established both across organizations and between organizations. Prof Stuart Madnick, , Room: E 53 -321, Ext: 3 -6671. [Revised 10 -23 -2005. Latest version in http: //web. mit. edu/smadnick/www/SIP 2005/ ] 1

General Outline In this SIP activity we will discuss: • What is the RFID technology? • What are the possible/claimed benefits of RFID? • What are existing or likely information infrastructure deficiencies, - Especially in the areas of information exchange and data standards? • What are some IT research directions to address these problems? Advertisement: If you like this material, consider these courses for Spring 2006: 15. 578 – GLOBAL INFORMATION SYSTEMS: COMMUNICATIONS & CONNECTIVITY AMONG INFORMATION (Tues & Thurs, 10 -11: 30; E 51 -376 – Primarily for Sloan MBA’s) 15. 565 / ESD. 565 – INTEGRATING INFORMATION SYSTEMS: TECHNOLOGY, STRATEGY, AND ORGANIZATIONAL FACTORS (Tues & Thurs, 10 -11: 30, E 51 -376 – Similar, but more technical) 2

Some RFID Hype RFID Auto. ID technology has received considerable media attention, innovation ideas, and controversy. For example: "Study shows RFID benefits for retailers. Retailers can expect extensive inventory and labor cost savings from the adoption of radio frequency identification (RFID) technology, but some consumer product manufacturers will face higher costs and delayed benefits from adopting the technology. That is the conclusion of a new report on RFID and the Electronic Product Code (EPC) from global management consulting firm AT Kearney. " ( from http: //logistics. about. com/b/a/042898. htm ) "Dvorak Slams RFID. It's bad news, claims John Dvorak. Those tiny radio transmitters that promise convenience and flexibility are just another path toward big brother domination. And it's going to get a lot worse. ( from http: //ct. eletters. whatsnewnow. com/rd/cts? d=181 -480 -1 -278 -10725923183 -0 -0 -0 -1 ) "A Manufacturer of soft drinks can identify with the click of a button how many containers of its soda cans are likely to reach their expiration date in the next few days and where they are 3 located at various grocery outlets. ( from CACM, August 2005, p. 103 )

What have you heard? Unusual or Intriguing Applications? • Bank of Nagoya installing RFID-based document management system • Automatically scan you when you entered classroom – so no need to sign “sign-in” sheet • • • 4

The Hype Cycle Peak of Inflated Expectations RFID Today! (? ) Visibility Plateau of Productivity Slope of Enlightenment Technology Trigger Trough of Disillusionment Source: Jackie Fenn, Gartner Group Time 5

Some Sources Used for Background Materials (found with assistance of H. Zhu) • http: //wwwx. cs. unc. edu/~sparkst/mobile/rfid/RFID. ppt • http: //www. scansource. com/downloads/RFIDWebinar 1. ppt • http: //www. public. iastate. edu/~ext 4 mjm/MIS 435/RFIDPres. ppt • http: //www. scansource. com/intermec/2004_webinars/Webi nar_RFID_July_04. ppt • http: //www. fiatech. org/Presentations/texasinstruments. ppt • http: //cosmos. kaist. ac. kr/cs 492 a/midterm 2/RFID. ppt • http: //www. masoftware. org/download/05 -20%20 Linster. ppt • http: //www. progress. com/progress/exchange/post_2004/te chnical_sessions/b 1200. ppt • http: //www. dodait. com/rfid/Summit. Apr 04/Day 1/05 RFID%20 Primer-Kimball. DOD%20 RFID%20 Industry%20 Summit%2029 Apr%2004 V 2. ppt (Do. D slides) 6

Outline Background (2: 35 -3: 55) • Introduction • RFID Technology – Comparison with Bar Codes – Example Applications • Focus on Supply Chain – EPC Tag and EPC Global • ROI Issues & Challenges • MIT Auto-ID Center Some of Sloan’s Research issues (4: 05 -5: 25) • RFID IT Infrastructure • Challenges to “Data Synchronization” • Role of MIT’s Context Mediation Technology in addressing the “Data Synchronization” challenge 7 • Discussion

What is Radio Frequency Identification (RFID)? Substrate Die attach Tag IC Antenna - Can be Passive or Active - Can be Read-only or Read-Write 8

Some Claimed Advantages of RFID vs. Barcode • • • No requirement for line-of-sight Many tags can be read at the same time High memory capacity if needed Dynamic information carrier (read/write) Robust and reliable Performs in rugged, harsh environment Cheaper in long term No human intervention Reader virtually maintenance free 9

PART 1 a RFID Technology Primer Adapted from Dan Kimball, Do. D Logistics AIT Office April 7, 2004 10

RFID: The History Pre-50’s 1960’s 1970’s 1980’s 1990’s 2000’s • 1926: Baird’s • Over 350 direct - reference • Harrington • 1973: Cardullo radio object patents • 1952: • MIT Auto-ID detection “Active & Center formation Vernon patent • 1975 LASL Loaded “Application • EPC™ releases Scatterers” research to • 1935: Watson- of the • Nationalintroduced & international Watt’s radar Microwave public sector standards emerge patent Homodyne” • LASL spins-off • Smart shelves IDX & Amtech • 1984: IDX/Allen • WW II: Radar • 2003: RFID • 1966: Sensor. Bradley install refined • Fairchild, RCA GM System • 1991: AAR prominent in • Harris matic & Checkstandard Iraqi Freedom & Raytheon point EAS patent: initiate pgms • EPCglobal “Radio formed 2003 • 1994: All • 1977: Electronic transmissio US railcars license plate for n outfitted motor vehicles • Multiple systems • 2004: TREAD • 1948: Harry early • 1997: US Army Stockman - with adopter rolls out TC- • 2005: Walmart Communications modulatable • 1969: Mario initial deadline AIMS II installations By Means of Cardullo RFID passive Reflected Power concept • Vast number of responder” • 1979: RFID companies enter RFID animal marketplace implants • 1 st Toll Collection Texas, Georgia / • Wide-scale US • 11 System - Norway RFID TIMELINE Adapted from Interaction Design Institute RFID Project Presentation - 2002 Oklahoma Tolls Roll-out

Technical Aspects of RFID § § § Tag Power Source Tag Components Read - Read/Write Anti-Collision Who talks first? Protocol Standards? The RFID industry suffered from a proliferation of standards, according to Sue Hutchinson, director of product management for EPCglobal had two GEN-1 standards, while ISO had two UHF air interface standards. (December 17, 2004) Ultimate focus of this SIP activity 12

RFID Tags Come in Different Forms – Can be attached to almost anything Class V tags Readers. Can power other Class I, II and III tags; Communicate with Classes IV and V. Class IV tags: Active tags with broad-band peer-to-peer communication Class III tags: semi-passive RFID tags Class II tags: passive tags with additional functionality Class 0/Class I: read-only passive tags Primary focus • Tags can be attached to almost anything: – pallets or cases of product – vehicles – company assets or personnel – items such as apparel, luggage – people, livestock, pets – high value electronics e. g. , computers, TVs • Many applications 13

Tag Types: Active RF & Digital Circuitry § Active: § § § RF antenna Battery Standard: None, Mainly Manufacturers Proprietary Systems/Protocols Range: Generally 300 Feet or less Battery powered / limited life Used Predominantly in Transportation Systems (rail, toll systems, trucking, container). Characteristics: Tag with Internal Power Cell Mounted to Item or container/pallet/box, Interrogator Queries Tags, Uploads/Downloads Data. Does not transmit all of the time. 14 Data Capacity Varies.

Tag Types: Passive Memory (EEPROM) Digital Logic & Control § Passive: § § § RF antenna (power source) Standard: None/many, Mainly Manufacturers Proprietary Systems/Protocols (uses back scatter technology) Range: Typically Measured in “Inches”, Working Toward “Meters” (dependant system layout, interference, etc. ) Used Predominantly in Retail Systems and Transportation Systems. Characteristics: Small Tag Loaded with License Plate Data Typically Mounted to End Item, Reader Captures Data as Item Moves Through Choke Point (door, pathway, frame, etc. ). 15 Data Capacity Limited.

Tag Types: Semi-Active Memory (EEPROM) Digital Logic & Control RF antenna Battery § Semi-Active or Battery Assisted Passive § On-board battery power source § Uses Passive Technology (no transmitter) § Greater range but higher cost (less than active) § Requires less power from reader § Finite life § Can use thin batteries (little change to form factor) 16

Tag Types - Read vs Read/Write § Read Only: § Information can only be read from an RFID device – programmed at manufacture § User Programmable § WORM - Write Once Read Many - Ability to initialize an RFID device outside of the RFID manufacturer’s facility after manufacture § Read/Write: § Information can be read from or written to an RFID § transponder during the time it is presented to a reader/writer Typically asymmetric read and write operating range 17

Technical Considerations § Anticollision § § § Ability to communicate with several transponders simultaneously Important in longer range readers Must be implemented in the silicon of the RFID device § Who Talks First § Tag Talks First (TTF) § After the tag is energized, it sends out a signal that says “I am here” § Reader Talks First (RTF) § As reader sends out energization signal it says “who is there” § Problems § With TTF you can get tag pollution but slower total read time § Compatibility issues? 18

Protocol § The method used to talk to a tag § Modulation method § Error correction § Anti-collision technique § Message format § Commands 19

RFID Operating Frequencies Low Frequency (125 – 134 k. Hz) Used in Access control, livestock, race timing, pallet tracking, automotive immobilizers, wireless commerce High Frequency (13. 56 m. Hz) – Smart Labels Used in supply chain, wireless commerce, ticketing, product authentication Ultra-High Frequency – UHF (900+ m. Hz) Emerging technology, applications still in development Microwave (2. 45 g. Hz) Still highly experimental, chipless technology 20

Worldwide Regulatory Environment North America Europe (current) Europe (future) Japan (new) Korea (new) Australia Argentina Brazil Peru New Zealand Band size 902 -928 869. 5 866868 950 -956 910914 918 -926 902 -928 864 -929 spotty Power 4 W EIRP . 5 W ERP 2 W ERP 4 W EIRP . 5 – 4 W EIRP Channels # 50 1 10 12 16 16 50 varied Class 0 Rate 1000 200 1000 400 1000 varied OOB spurious -50 d. Bc -63 d. Bc+ -54 d. Bc 50 d. Bc -50 d. Bc ? ? 21 No Global Solution – Standards are a Challenge

Frequency Selection Issues § § § § § Desired Pattern Required Range Tag-to-Tag Spacing Data Rate Size Requirements Power Requirements Interference Issues Noise Environment Cost / Performance Tradeoffs 22

RFID System Considerations • Read distance requirements • Long read range • Short read range • Frequency • All frequencies have their pros and cons • ISO standards • Proprietary or standards-based • Government regulations • Varies from country to country 23

RFID System Considerations • Multiple Tag Reading in Same Field • Anti-collision • Sensitivity to Orientation • A single orientation or omni-directional • Hardware Set-up • Environment can affect performance • Tag Sensitivity to Metallic environments 24

Reader Characteristics • Stationary or handheld • Weather-proof or industrialized • Typical read ranges vary from a few centimeters to a few meters • Read Range is dependent upon: • Broadcast signal strength • Size of broadcast antenna • Size of transponder antenna • The environment – Metallic, Liquid • Multi-frequency readers 25

How compare to 2 D barcodes RFID Tag 2 D Barcode Line of sight Not required Required Capacity Low to high Low to medium Security High Low to Medium Change Information? Cost (today) Yes – Read/Write $0. 40 - $1. 00 (in millions) NO – new label $0. 05 or less 26

Barcode Examples – Many types UPC A Maxi-code Codablock Code 49 QR Code PDF 417 Data Matrix 27

Current Technology: Bar-coding • UPC A code – – 18 digit alphanumeric code used for identifying flow of package and billing information Large database used to support this system – 18 terabytes • Maxi-code – – – Determined by the locations of bars around a central dot Contains information for the destination address of the package as well as weight and size specs. requires special equipment and a stable environment free from movement to obtain a read 28 of the information

RFID vs. Bar-coding • Bar-coding Disadvantages – Code must be clearly readable • free from dirt, smudging or other damage • This is problem with the constant movement of packages – Code must be in a position that can be easily read by a scanning device • Optical lasers are usually used for scanning – Code must be within a short distance to be read • Typically within 3 feet – Only one code can be scanned at a time – Codes must be a reasonable distance apart • The use of RFID can eliminate many of the problems associated with bar-coding technology. 29

The Future? -- A Hybrid World § § § Traditional bar codes § Will remain the dominant auto ID technology for the foreseeable future § Lowest cost, broadest applicability, huge infrastructure investment 2 D bar codes § Will be increasingly adopted for value added applications § Portable data files, supplementary retail coding etc. RFID § Will be increasingly adopted where non-line of sight, read/write, multiple detection offers real advantages 30

Implementations of RFID • Retail is the current driving force – Wal-Mart – Target • Others – Department of Defense – UPS – Other logistics firms 31

Things to consider • Price of tags – Currently about 10 to 50 cents each – If just $0. 01, $250, 000 to tag every P&G product – Chicken and Egg • Uses – Wal-Mart will be collecting existing data – Many possibilities • Technology matures – Cheaper and standards • Privacy (e. g. , “RFID chips in world soccer tournament tickets questioned”) – All 2. 9 million tickets for FIFA World Cup soccer tournament in Germany include an RFID smart tag 32

RFID in Action … Pay for Gas at Exxon/Mobil with Speedpass Buy Burgers at Mc. Donald’s Get a Coke from a vending machine at the Olympics Check out library books with 3 M system Race timing at most 33 major Marathons

Toll tags, parking lot access Building access control, security Event access, ticketing Anti-theft for automobiles 34

Product authentication Chip wafer Manufacturing Warehouse, supply chain, logistics Livestock, asset tracking 35

Electronic Article Surveillance (EAS) § Already exists § RFID technology detects if an item is removed from a store without tag being deactivated § Amorphous magnetic strips § Destructible tuned circuits § But - Existing technology cannot uniquely identify goods § New RFID technology provides significant features: § Able to write SKU number into transponder § Automatic inventory with a hand held reader § Anti-collision mandatory for this feature § Cash registers can automatically ring up merchandise 36

PART 1 b RFID – Supply Chain Perspective Adapted from im jae hyoun "A Manufacturer of soft drinks can identify with the click of a button how many containers of its soda cans are likely to reach their expiration date in the next few days and where they are located at various grocery outlets. ” ( from CACM, August 2005, p. 103 ) • How easy / realistic is this? • What infrastructure must exist? 37

how it works… Adding Identity to Products Coke 38

how it works… Adding Identity to Cases: Assembly line applications 39

how it works… Reading Tags: Portal applications: Shipping validation & Confirm routing 40

how it works… -Savant (middleware software for EPC) -ONS (Object Naming Service) -PML (Physical Markup Language) 41

how it works… Efficiency in Distribution 42

how it works… Efficiency in Inventory 43

how it works… Overstocking and Out of Stock Eliminated 44

how it works… Consumer Convenience 45

Some Serious Challenges & limitations… materials and effect on signal Material Effect(s) on RF signal Cardboard Absorption (moisture) Detuning (dielectric) Conductive liquids (shampoo) Absorption Plastics Detuning (dielectric) Metals Reflection Groups of cans Complex effects (lenses, filters) Reflection Human body / animals Absorption Detuning (dielectric) Reflection 46

Supply Chain Reality It is happening … 47

RFID in the Supply Chain SC Visibility & Event Management SC Leader ERP EPC Data Management Infrastructure (Private/public) Who controls? Retail Distribution Center Contract Manuf. VMI Supplier Flow of Goods 48

Understanding RFID’s Potential Sample Supply Chain Repair Center Returns Hub Warranty/Services Revenue Supplier VMI/ Inbound Hub Manufacturing DC/ Outbound Hub Reseller/ Customer Distributor Chargeback Revenue Collection Out of Stock Brand Protection Shrinkage Counterfitting BOM Tracking Lot Tracking Operating and Handling Cost Shipment Visibility Comp. Inv. Visib. FGI Inv. Visib. Planning & Synchronization 49

PART 1 c Making a Case for RFID - ROI Adapted from Greg Dixon Chief Technology Officer Scan. Source 50

Why do people buy RFID? • Traditional Reasons: – Reduction of direct labor (80%) • Hand-held reader vs. Fixed reader – Protection and tracking of assets • Animals – Inventory – Tires – Access Control - etc. – Cost Structure reduction • Out of stock - 7. 8% – “walk aways” – Only technology that will work • When bar codes don’t work – (dirty / line of sight) • New Reason: – Mandated 51

RFID Timeline (goals) ted ode ven ar c In Cb RFID t UP FID Firs ck R ans to rds D D pl ives L da MIT RFI Stan GM cts nce d@ odu nou arte RFID an l st 1 pr ISO Do. D loba s/2 G nd lier in EPC upp cs art a beg s spe al*M lots s 8 W n 2 ent rt pi s Ge plem l*Ma 134 he m Wa blis top art i es to sta al*M stor ine al e W es adl lob 250 stor rt de and PCG E 600 Cs *Ma Wal and t 6 D r ppl DCs l*Ma D su Wa Do rt 13 and l*Ma art Wa sive al*M W erva ain p All RFID pply ch s u clas in s Item ing tagg 48 - 74 - 79 - 84 - 95 - 99 - 03 - 1/04 - 4/04 - 7/04 - 1/05 - 6/05 - 10/05 - 07 - 09 - Today 13 52

Technology Adoption Life Cycle 2007 Wal*Mart / Do. D Sunrise date Companies Today 20, 400 9, 600 Companies under RFID mandate 0 60, 000 Time 53

Two primary concerns for Supply Chain users: • Concern #1: Return on Investment - ROI Labor Visibility Supply Visibility Fewer Faster More Accurate Where is the Inventory? Demand Visibility What are Customers buying? Decision Visibility What do customers want? Reduction in costs > RFID technology investment = +ROI 54

“Slap & Ship” = pure cost May be the majority I inc reas es inc rea l RO $$ ntia ed Pote Tag and Ship - no data integration Inv Tag and Ship Link to trading partners - with data integration est ps St e Limited Mfg Adoption Reduces more - with data integration real costs Limited Mfg Adoption Reduces some - no data integration real costs ses Full Corp. Adoption Maximizes - with data integration cost reduction to RO I • Concern #1: ROI – Easier said than done Note importance of data integration (addressed in part 2) • Challenging within a large company • Very challenging between/among multiple companies 55

Two primary concerns for Supply Chain users: • Concern #2: Partnerships Let’s do the math 60, 000 mandated suppliers • One of the largest RFID S. I. (“handle maybe 100”) • <100 RFID Vendors & S. I. s * - 100 x 50 = 5, 000 • Must mobilize >1000 new RFID Solution Providers just to meet the demand for partnerships 56 * RFID Journal

Winners & Losers ? • AT Kearney study • Retailers benefits – Reduce inventory by 5% – Reduce store & warehouse expenses by 7. 5% – Reduce “out of stock” $700, 000 per $1 B • Manufacturers costs – High impact (expensive) v. low impact (cheap) – Low impact: $155 M in capital costs (assuming $. 15/tag, 10 year horizon, 12% cost of capital 57

What about “closed loop” & Enterprise applications? • RFID technologies have been available for a decade • For many applications the tag cost was too high • Supply Chain volume reduce tag costs • All those applications are still waiting for an RFID solution 58

Enterprise Level Applications CRM ERP Re-define the “Edge” of an enterprise Middleware Edge Server Read Failure Light Stack Printer/ encoder RFID Reader/ encoder Sensors Bar code Scanner Message Board Scale PLC 59

Outline Background (2: 35 -3: 55) • Introduction • RFID Technology – Comparison with Bar Codes – Example Applications • Focus on Supply Chain – EPC Tag and EPC Global • ROI Issues & Challenges • MIT Auto-ID Center Some of Sloan’s Research issues (4: 05 -5: 25) • RFID IT Infrastructure • Challenges to “Data Synchronization” • Role of MIT’s Context Mediation Technology in addressing the “Data Synchronization” challenge 60 • Discussion