Mister Beacon Episode #63

RAIN RFID Explained

January 29, 2018

As we consider what is known as The Internet of Things, RAIN RFID is one of the technologies that will undoubtedly be an integral part of IOT moving forward. Will there be a day when actual things such as sweaters and socks are identified via electronic technologies? Steve Halliday, president of the RAIN IFID Association says he has no doubt about it. In this great conversation, Steve shares a great deal of information about what RAIN is capable of doing now and looks into the future to explain possibilities that are not too far off. It's an intriguing conversation that's well worth the time it takes for you to listen.

Transcript

  • Narration 00:00

    The Mr. Beacon podcast presents RAIN RFID explained with special guest, Steve Halliday president of the RAIN RFID Association. The Mr. Beacon podcast is sponsored by Wiliot, scaling IoT with battery free Bluetooth.

    Steve Statler 00:18

    So, Steve Halliday, thanks very much for joining us on the Mr. Beacon podcast, we, we spend a lot of time in the world of Bluetooth. But this podcast is really a continuation of a book that I wrote called Beacon Technology. And in it, we looked at RFID and NFC. And, you know, my view on this is they're all tools in the, in the tool bag. And the big thing is knowing, you know, when do I use a chisel? Where do I use a saw? It's not that saws are better than chisels, they're just different tools for the job. And I can't think of anyone who's better placed than you to talk about RFID because you are the president of the RAIN RFID Association. Perhaps the best thing to do is for you to kind of kick us off and explain what is RAIN RFID we've all heard of RFID. But what is RAIN RFID.

    Steve Halliday 01:11

    Thanks, Steve. Thanks for inviting me to be on the podcast this afternoon. That's really nice. RAIN is a particular type of RFID. RFID is very much a an overarching name. And it encompasses lots of different types of technology that are RFID radio frequency identification. You mentioned NFC and LFC is one particular type of RFID. In the same way, what we've tried to do is to brand passive UHF RFID has RAIN RFID. We formed the Alliance back in 2014, for companies got together and decided that nobody was doing anything to market this technology. So we should create an alliance whose main goal will be to market the technology to get acceptance broadly for it. And that's what we've been trying to do. And I think that's what we're, we're succeeding with right now.

    Steve Statler 02:10

    So going on for four years, what who were the four companies?

    Steve Halliday 02:14

    So the original founding companies were in Penge, Smartrac, Google and Intel. And all four companies were very actively involved with the technology could see no, no organization doing marketing, other than their own individual and other individual organizations. There was no overarching thing marketing this particular type of RFID. So they decided that we needed an association that could look at that and do it. They invited me to help them set it up, which I did. And we've grown since from those four members back in 2014. We now have 155 Members, I think it is from all around the world.

    Steve Statler 02:59

    Cool. And then you have a board, who's on the board?

    Steve Halliday 03:02

    Ah board members always a very interesting situation. We have set our board up so that we have constantly rotating board members. At the moment we have somebody from in pen you somebody from SmartTrack somebody from Google, somebody from Avery Dennison, somebody from NXP, somebody from Amazon. And who have I forgotten?

    Steve Statler 03:27

    Well, who's who the ones that you've noticed, you can always come back and fill in the gaps later on. I mean, it seems to me having viewed your resume that you've been working on related technologies almost since you left Wallingford Grammar School quite long time ago. You were involved in some of the standards work well.

    Steve Halliday 03:52

    That's very true. Yeah. In fact, I've been working on these kinds of technologies literally, since I left college. That's it. That's the only arena I've worked in. I started off in the magnetic stripe technologies, doing a lot of work with magnetic stripes, migrated onto barcodes and RFID. And I've been doing RFID stuff since about 1996, which probably predates most people involved, but as you said, I've been involved very heavily in the standards world. I was convener of the standards, the ISO standards group that wrote the standards for RFID. For most of the frequencies, the only exception being the NFC stuff. So yes, my background was pretty much in standards and what I enjoyed doing with standards and I just grew out of that into into everything else.

    Steve Statler 04:43

    So can you because standards are super important in terms of building an ecosystem and having people feel like this is something they should invest in. So can you give us a quick guide to the relevant standards what they are, how does GS one fit into this and the ISO standard?

    Steve Halliday 04:59

    Yeah, it's a very complex question that you've asked. And if I was to sit here and just recite the Names of all the standards, we'd probably still be here two hours from now. The way we in RAIN have looked at this is that the key standard is the air interface. That's the standard that defines how the RFID tag talks to the reader. And that's what we have internally standardized on ISO created a standard we call the ISO 18,000, Dash 63. And GS one have a similar standard, they call it gen two UHF, those two standards are identical. The ISO standard actually has some extra things in it. But but the GS one is complete subset of the ISO standard. And we focus very much on that that's that's our baseline. That's what we deal with, if somebody manufactures or uses the technology that conforms to that hair interface, than we consider them to be a RAIN user. So there are many other aspects of standards all the way from how you create numbering systems, which of course is very much the GS one province that they have had numbering systems that we've been dealing with for many, many years, those people who've been involved with barcodes are probably intimately familiar, those of us that perhaps weren't as involved with with barcodes, or certainly seen those just one barcodes on everything you buy in the supermarket. So they are very much involved in in helping to define a numbering system that we can extend into RAIN tags. Other standards that are of equal importance is how do we handle that data? Once we have it? Once the reader gets its collection of ones and zeros that it reads? How is it formatted? How does it transfer it on? And what do we do with it? So there are a whole suite of standards and people can go to GS one webpage. And they can see the GS one version of those standards, which are all freely available or if you're interested, there are equivalents and more on the ISO webpages.

    Steve Statler 07:10

    So can I adopt a GS one standard for identifying my products and have that flow across, say barcodes? And RFID tags? And even Bluetooth beacons? Is that? Is that feasible?

    Steve Halliday 07:26

    You certainly can. The same number will apply to a barcode as applies to the RFID tag at this point. I know that GS one is looking very closely at other technologies. It's not wishing to be exclusive to barcode and RFID how that works with a Bluetooth beacon at the moment I couldn't actually answer for you. But I know it's their goal that they will be completely technology agnostic and will work across all technologies.

    Steve Statler 07:57

    All right, we actually have an interview coming up with a asset tracking company in the UK who claim to have GS one compliant Bluetooth beacons, which I think is very unusual. So I'm really looking forward to hearing more about that. Give us a sense of so you've been going at this for a few years. Where is the industry at? What's the trajectory? What's the scale of RAIN RFID at the moment?

    Steve Halliday 08:22

    Sure. I think one of the things that perhaps people don't think about and don't realize is that we have this buzzword that's out there, the Internet of Things, almost everybody talks about it in some way or other. And what they talk about really depends on who they are and where their focus is. But But we think that RAIN is going to be one of the primary drivers into the Internet of Things. Because if you take it to the thing level, rather than what we call the device level. So a phone, for example, or a nest thermostat, we think of as devices rather than things because they have intelligence, they probably already have a numbering system built into them. They have communication capabilities. Whereas a thing is a pair of socks, some jeans, a mug up or whatever. So things that are basically not communicating with the world right now. But if we are to follow through with this Internet of Things concept, we will need to be able to identify them and discover them. So we think RAIN is the the ideal mechanism to do that. And so, in 2016, there were over 10 billion RAIN tags deployed. That means we have identified 10 billion things in 2016. That was a growth from somewhere around 5.8 billion, I think in 2015. I don't have the numbers yet for 2017. We'll have those in a few weeks. And I'm expecting us to be somewhere in the 12 13 billion for 27 Tea. So if you just take those three years, 1516 and 17, we're going to be over 25 billion things identified in the last three years. But that kind of goes against what many of companies have been saying, in the past five years about, we will have 20 billion items, 50 billion items identified by the year 2020. Well, we're pretty much getting there already. And we think that will be a lot more yet.

    Steve Statler 10:25

    I thought I saw something from NPM saying that they produce the 25 billion chip. But obviously having producing it certainly means it's out there embedded in a sweater or anything. But certainly, it's staggering, absolutely staggering.

    Steve Halliday 10:42

    It's very different numbers than you think about when when you listen to some of these companies that talk about Internet of Things. But But our goal is that the technology, which is not just an identification technology, we like to talk about being able to engage with things, many of the chips that are now being produced, have that capability to engage to talk to sensors to talk to relays or whatever, and actually initiate things. We have full encryption available at the chip level, which means that we can authenticate. So if you're not supposed to be able to read it, you won't be able to read it. So I think we can do location with with the technology as well, which gives us a great means of providing the full suite of things needed for the IoT to move forward.

    Steve Statler 11:33

    So how do you prevent someone from reading a tag? That's not supposed to read it?

    Steve Halliday 11:40

    Yeah, good question. So So with with full encryption techniques employed in the chip itself, it means that the chip and the reader can exchange tokens backwards and forwards that would identify whether the reader has the rights to talk to that particular chip. So a good example might be for example, let's say, let's say you've got some particular illness, you're carrying some particular drugs on you, you don't really want the bad guys to be able to sense that you've got those drugs, people are always worried about walking past people with with readers and being able to see who they are and what they do and all the rest of it. If that particular bottle of pills, let's say is tagged with something that has been encrypted, then only an authenticated reader will be able to read it and tell what it was that it was talking to. Because we don't deal with human information in tags, we're really talking about a number. But if they're always to access look ups to look at numbers, of course, to a certain extent, the GS one numbering system is a very public numbering system, it's not hard to find out that this particular number is allocated to Procter and Gamble or whoever. So it wouldn't be hard to find out if it was a drug or not a drug. But but by authenticating by using encryption techniques, we can we can limit that accessibility.

    Steve Statler 13:05

    And is that something that can be done at scale, because what I think of is one of the strengths of RFID is that you can take a pretty dense set of assets, like all the inventory, and in an apparel store, and you can swipe and you know, these readers are designed to read maybe 1000 items a second is pretty amazing. Can you do decryption at 1000 items a second or does that?

    Steve Halliday 13:38

    No, you can't not? Not today anyway, I must admit the the tank chip developers and the reader developers are all increasing the performance of everything. Almost every month, it seems we're not quite at that speed for full decryption yet, but it will get closer to that. And then you have to decide do we really need that kind of speed for that kind of operation? And so the answer is probably no. We do need speed if we're going to start doing some of these inventory things. A high speed, I was talking to somebody the other day who is looking at employing drones to fly up and down the aisles in a warehouse to actually do full inventory of the warehouse using drones moving up and down, which I thought was really neat idea. And obviously they need very high speed read and so forth to do that. So we're gonna fly these things up and down.

    Steve Statler 14:27

    That's so awesome. I love it drones and auto identification. So let's talk about price because that's got to be one of the gating factors and you're kind of in this position, which kind of one out is difficult because you don't represent any one particular vendor but you have this bird's eye view. What's your assessment of if I'm gonna buy 1000 tags, just a vanilla tag, no encryption, no sensors. What am I going to Pay for 1000 RAIN RFID tags if I'm gonna buy a million or a billion what what does that price curve look like? Very roughly? With all the caveats.

    Steve Halliday 15:13

    it's hard for me to answer the question. And I must preface the question was saying, of course that you have to look at the application and make sure that the the tags that you're buying is suitable for the application. We do have instances where people buy tags and then find that they just don't work in the application they were hoping for. But I'll give you some ranges, if you're going to be buying 1000 tanks, you're probably going to be spending between 30 and 40 cents each. If you're going to buy a million, it's going to come down, if you're going to buy a billion, we're probably getting much closer to the to the four cent level, depending on the tag that you want. Of course, some tags, we have what we call hard tags, whether the the tag part itself is embedded in a hard plastic case, they may be $1, or more depending on what it is you're trying to do.

    Steve Statler 16:09

    Well, that's, I think, very, very useful for people to get kind of get that that sense. Let's talk a bit about use cases. Because this is just so interesting. This, okay, we can now identify everything, but what are we going to do with that knowledge? And tell us where you see the let's first of all talk about the sweet spots in terms of what's driving the volume today. And then I'd like to kind of get your sense later on about, you know, where, where this is going and some of the more tangential but interesting use cases. So where's the sweet spot?

    Steve Halliday 16:45

    Yeah, I think obviously, the one that we have to talk about today is retail. Retail is where it's happening for my industry at the moment, I just come back from the National Retail Federation show in New York, in which we saw lots of applications where RFID is in use or being thought of as use. And there's no doubt the majority of those 10 billion tags that were deployed in 2016 went into retail applications. Companies retail started some years ago for RAIN, with a case and pallet mandate from Walmart never really took off in the kind of volumes, people thought it would take off. Probably a million reasons why maybe the technology wasn't quite there as well amongst all that, since then, technology has increased dramatically in performance and reliability. And now we're talking about item tagging, we're not really talking about cases and pallets anymore. And it seems to work so well that everyone wants to do it. We see statements from people like Macy's who are going to be 100% tag, before the end of the year, they have companies like decathlon and major sports store in the rest of the world, except for the US. Where they have nearly 1000 stores and all of them are completely RAIN enabled. 90 something percent of every item in the store has a red tag on it. They use it for everything from inventory to point of sale. So we're seeing more and more of those on our website. Or in rfid.org we have a section devoted to retail and we've identified 100 retailers that are actively using the technology at this point. So we just see that growing like crazy in the next two to five years, mostly too.

    Steve Statler 18:39

    But what are the business benefits? What how do they justify doing it? I mean, as a technologist, I love the fact that you could identify everything in the store. But But why what what's the argument that the innovation department gives to the CFO that allows him to buy a billion tags.

    Steve Halliday 18:58

    So I think the big one, the one perhaps that has been publicized a little bit, but the one that seems to be a key for many of our suppliers is that we can start talking about the whole story of the goods. There are many instances where just a straight inventory doesn't give us the whole story. It's great that we can look at the warehouse we can look at the things in the back of the store. But what we really also need to know is what's happening in the front of the store. And perhaps the Macy's example is a great example. They did a pilot with chutes. And in Macy's like many other department stores, they've only got so many square feet that they can put shoes out on. So typically there's only one shoe of each style out on the floor. So during the day somebody would come in likes the shoe. And the one that the size that they wanted happened to be there was one on display, they try it on, they'd buy it, they'd leave, and there'd be a gap. So that she was no longer on display, therefore, basically no longer for sale, until somebody went to the back room and replaced it. They moved over to tagging all of the shoes. And Macy's reported something like a 9% increase in sales in the shoe department. And that was purely because they were able to keep the stock in front of the customers. So when you look at that, and you look at some of the omni channel, things that are going on, where you sit at your computer, and you order things and you want to know if it's in the store, or if it can be shipped to the store and all the rest of it. Suddenly, by knowing what's out on the floor, as well as what's in the backroom, you have a much better way of keeping your customer happy and supplying them with what they need. You probably remember many times, thinking you wanted to purchase something, you might even have gone to the website and looked and said yes, they've got six in stock. And when you get there, they've got none. So that's because they don't have the true visibility into what they've done. And the inventory you were looking at might have been several days old. With RFID, we can make back inventory almost instantaneous. By using handheld readers on the shop floor or overhead readers, we can monitor what's going on dynamically. And if you go back in time to when the term Internet of Things was coined, Kevin Ashton was the person who used that term. First. He was working for a company who wanted to look at a problem they had with with lipstick, they wanted to be able to keep the lipstick available to people, they had a problem with people coming in, looking at the lipstick, moving it and putting it back in a different place. So when the next person came in and wanted this particular shade of red or pink or whatever, it wasn't where they expected it to be. So the left without purchasing it when in fact, it might have been right there on display, just not in the right place. So Kevin came up with this concept of identifying lipsticks and knowing where they were. And if it got put back in the wrong place, it would send a flag and someone could come out, put it back in the right place. And he coined the term internet of things because he thought that was how things should work since then, that terms come to mean and many other things. But we've moved on. And that system, which he thought of as an RFID based system, is exactly what's happening right now. Think of jeans. If you're like me, you hate going clothes shopping. So you know what jeans you like to wear, you know what size you want, you go to the store, you look at the racks, you say, oh, it should be here, up, none, then goodbye. And you leave, you don't go looking around for it. Because, hey, we're guys. And we didn't do that. So if the store was able to keep things in the right place, they'd stand a much better chance of making that sale, making me happy. And presumably making me a recurring customer who would come back.

    Steve Statler 23:12

    I remember talking to American Apparel years ago when they were kind of at the bleeding edge of this. And one of the things they said was all things that you mentioned as a benefit, the fact that they could do an inventory check sort of in a fraction of the time and also leakage the theft from employees, when way down, when you know where everything is. And when it disappeared. It's amazing how people tend not to nick it quite so often.

    Steve Halliday 23:38

    I mean, I think it's not just employees, of course, I mean, we all hear stories all the time of people who put a barcode from one item onto another one so that they can buy extreme 65 inch TV for the price of a 25 inch or whatever. And when you've got tags embedded in things, maybe directly embedded in the packaging, certainly not visible because we don't need to see the tag in the same way that a barcode needs to be visible. an RFID tag can be embedded in the card and we can still read it very clearly. That makes it much harder for someone, whether it's going out the back door or the front door to MIT to eliminate that kind of problem. So yes, I think that's important.

    Steve Statler 24:22

    And the other thing that I had recently got speaking to the general manager for one of a really big IoT company. And he said, since Amazon bought Whole Foods, their retail business has exploded because it's just put the foot fear of God. It's like what motivated spend money. It's either kind of greed or fear. And it turns out fear is actually a really good motivator.

    Steve Halliday 24:48

    Yeah, I think that's very true. It's interesting that you you raise the Amazon question of course, because this week, the Amazon Go store went live in Seattle for a long time now many people have been speculating that RFID was in use in that store. It turns out that's not the case. They have other techniques that they're using for that store. But they're they you have a store that's completely automated. You don't have checkout people who check you out that they have a system that they've developed using cameras and weights and all sorts of things to, to monitor it. This, the Alliance had a meeting in Shenzen, in China, back in October, and we were lucky enough to have one of the ministers from metti in Japan come to give a presentation. And he talks about the fact that that in Japan, the convenience stores that the 711 type stores have a major problem being able to afford staff to run them. And so they have started a project that they call the 100 billion tank project, in which they will completely eliminate the staff in those convenience stores. They reckon it will take 100 billion tags a year to maintain it. But it will be completely RAIN RFID driven. Now that that's really exciting for us, obviously, because 100 billion tags a year is 10 times more than we, we were at in 2016. And we were really pleased to be a phantom. But obviously, it also brings a lot of other challenges in the price obviously has to drop for us to be able to tag. Like packets of chewing gum, for example, obviously, the price has got to fall, I use the chewing gum example of course, because that's where a lot of our interest is started, the first barcode that was scanned ever in a grocery store was a packet of chewing gum. So but the the, the members of the Alliance are working hard with the Japanese government to try and create a system where that can be affordably done, they have to be able to encode those tags, obviously at high speed. And whilst we can to a majority of an extent some of the things that are produced are perhaps even higher speeds than we're used to using right now. So I know several other manufacturers are working to solve that problem.

    Steve Statler 27:10

    So this is the production line, if you're creating sort of consumer packaged goods in large volumes, then these are then it's these are coming off at rocket speed.

    Steve Halliday 27:21

    So I mean, again, go back to the packet chewing gum, obviously, when they packed those things that they fly off the line that probably hundreds, if not 1000s a minute. And you've got to be able to encode every single one of them individually.

    Steve Statler 27:34

    So, how do you do that and drop the price? Because what you're asking for is a high speed computer to be put in and they're saying, Oh, I'm sorry, four cents is too expensive? And how do how do people like NXP and Impinj? make any money out of selling chips?

    Steve Halliday 27:53

    Good question. I mean, obviously, I'm not in their companies and can't answer for them as to how they will do it. But there are there are ideas that are being talked about as to how we can actually achieve that high speed encoding. So that those items will become unique items. And there are a couple of ideas that are being floated, some of which look very feasible right now. And I think retests underway to try and prove that will work and will do exactly what the Japanese government needed to do. So we'll get that. And we'll get there very fast, because the goal of the project in Japan is to be up and running in many stores before the end of this year.

    Steve Statler 28:31

    Well, I think you're telling a very clear story about kind of the value for supply chain for competing with these Amazon's aggressive, innovative efforts. And I feel like, that's clearly there's a lot of room for expansion. The area that I'm not so clear about is the consumer after the consumers taken the product from the store and their engagement with the product. And I'd love to get your opinion on that. Because I think this is terribly hard. I mean, not that the other stuff is easy. But at least you know, you have workers that work for you and systems that you can dictate, but you can't tell consumers what to do. And I guess in your space, the consumer doesn't interact with RAIN RFID anyway, it's that's really more of an NFC thing. But I'd be interested in your view as to whether there's a consumer play here and maybe looking over the wall at the NFC folks, do you see there's any future where consumers will be interacting with their, this their T shirt or their jeans or other products?

    Steve Halliday 29:45

    I do I very much do. One of the conversations that we're constantly having is when do we think we will have RAIN enabled cell phones? That there is one available now coming out of China? There are people who offer the ability to add RAIN readers into an Android phone using a reader built into a sim chip that you can just put in the phone. And we know of phone companies who are aggressively pursuing the phone manufacturers aggressively pursuing how to build the readers into the phone. And you're exactly right. So the big question is why. Now with NFC, it's been kind of cool, we've all been able to play with NFC and do all sorts of things. And we see the same sort of thing happening with with RAIN, but in a different way. And I guess the best, the best buzzword to use right now is augmented reality. We're seeing demonstrations from some of the phone, company, phone manufacturing companies about how they want to use augmented reality with the phones. So it's helping you do your shopping. So for example, you might want to go into a store, you'd hold your phone up looking at the screen, it would see the shelf displays, and it will be able to tell you exactly where the items on your shopping list are located on the display. It might even be able to do things like point out that if you bought Company B rather than Company A, you might save some money. And the phone manufacturing companies are very interested in that side of things. And we see that's not an NFC thing, the range for an NFC tag isn't sufficient to be able to do that kind of thing. Whereas RAIN turnings can be read quite happily, distances up to 10 meters or more. So easily we can identify everything in the store. And the augmented reality brings it to the customer, it might be another way of looking at it is you might go into your kitchen and use your phone to actually look at what's in your shelves. So you could have an application that would quite easily develop your shopping list for you. It would say Oh, Steve, you're out of that. Barbecue sauce that you love so much did you realize you hadn't done on the shelf, add it to the to the shopping list. Yeah. I scan my whole kitchen, I go off to the store, I scan the store, it tells me where things are reminds me that I need them and does it all for you.

    Steve Statler 32:19

    Having spoken to a few retailers about this, I think they give their eyeteeth to solve the replenishment problem having a button even though that Amazon thing was very, very cool. What what I hear from people who have spent a lot of time looking at it is it's been a great commercial success, because basically those dash buttons are an advertising opportunity. But once people buy them, they press them once. And that's it, they never get used again. Whereas if your phone could know that you're running out of cornflakes, or maybe even some more valuable, yeah, item and reorder and make sure you're never I mean, the brands would love it, the retailers would love it. The whole supply chain gets optimized around consumption. I'm the thing that's an incredible, exciting.

    Steve Halliday 33:09

    Obviously, we're not there. I mean, I have a phone here on my desk that has RAIN built into it, it works very, very well. It's not a fully functioning phone, because there are a prototype and there are some development issues still to be dealt with. So it's not something that company is about to offer tomorrow, but I'm sure that it's high on their list of looking at as to how they can do that they see the market, the phone manufacturers are very much involved with the augmented reality side of things, I very much want to be able to achieve that. So I would say put put my guessing hat on here and then say probably within two years, we'll be able to buy phones with with RAIN RFID readers built into it with all of the applications that that's going to bring to us to do even more new things. Find your socks when you've misplaced I mean.

    Steve Statler 34:00

    And actually, the solve the mystery of where does that odd sock go? I lasting mysteries. So very good. Well, we've had a great view of the future. You've given us some interesting perspective on on the past. So Steve Halladay president of RAIN RFID Association, this has been a great conversation. Thank you so much.

    Steve Halliday 34:24

    Thanks very much, Steve, if I can just add one thing before we go. RAIN is going to hold an event on the seventh of March. And we invite everybody to come it will be held at Google headquarters in Sunnyvale, California. You can go to the RAIN website right now find either or, and get the details for it. We have a fantastic day of speakers talking about all the aspects of technology events being held in cooperation with the NFC forum and aim. So there'll be lots of people who have got lots of knowledge that you can learn all about. So I invite you and all of your excuse to come along to the event you can register from the website. Thanks for having me.

    Steve Statler 35:04

    I'm gonna do that. I'll see you there.

    Steve Halliday 35:06

    Okay, great. Thanks, Steve.

    Steve Statler 35:07

    Cheers.

    Narration 35:11

    The Mr. Beacon podcast is sponsored by Wiliot, scaling IoT with battery free Bluetooth.