RFID Revenue to Hit $5.6 Billion This Year, ABI Says

March 31, 2009 Alex Woodie

Spending on RFID–including transponders, readers, software and services–will amount to $5.6 billion, ABI Research said last week. While the number is lower than ABI had previously predicted, it doesn’t mean the wireless technology is in a state of “despair or turmoil,” the research group said.

It’s been just a few months since ABI released its prediction that RFID would grow 15 percent annually to reach $10 billion by 2013. With the benefit of hindsight, we can now tell that those November predictions were slightly rosy, as overall IT spending has dipped southward along with the poor economy.

“The recession has had an undeniable effect on deployment plans,” says practice director Michael Liard. “But despite some project deferrals and terminations, there will be market growth, albeit fragmented.”

ABI recommends that its clients position RFID as a “cost saving” technology to enterprise customers. That, too, could be a tough sell, considering the lackluster ROI that RFID has generated, according to an ABI study from earlier this year.

But don’t fret: the sky is not falling in on RFID. “Although the RFID market faces economic challenges,” Liard says, “ABI Research would not characterize it as being in a state of despair or turmoil. We do not anticipate near-term market contraction based on economic conditions. However, anticipated growth rates may not be as robust as in previous years.”