Yet RFID can also provide the rationale for a profitable business-line restructuring. Carlsberg-Tetley Brewing, for example, identified RFID as an opportunity to outsource the management of its beer kegs. "It will put the complexities and the rigor of content management into the hands of a better provider," says David Dixon, business solutions executive for the Northampton, England-based beer maker.

One of the United Kingdom’s largest brewers, Carlsberg-Tetley last September sold more than 1 million of its containers (a.k.a. kegs) to Trenstar, a Denver-based asset management company. Under the arrangement, the brewer will pay for use of the containers on a "per fill" basis while Trenstar will retain legal possession of the containers. Trenstar, in turn, will put RFID tags on each container and install fixed readers alongside conveyors inside Carlsberg-Tetley’s breweries. Delivery trucks will also be equipped with readers that scan the kegs as they are loaded onto each vehicle and then off-loaded at local pubs.

The arrangement is designed to allow Carlsberg-Tetley to improve its return on capital by removing the containers from its balance sheet. The RFID technology, on the other hand, should let Trenstar cut the losses Carlsberg-Tetley was experiencing from lost and stolen kegs. "That’s the result of the need to attach tags to over 1 million containers," Dixon notes. The new system is scheduled to become operational by the end of 2003.

Tag and Read

As RFID evolves and the prices fall, the technology will track an ever-wider array of objects. Many observers also expect RFID to eventually find a home inside a variety of everyday business and consumer products. "RFID is actually already deployed in many retail environments. People just don’t think about it that way," says Woods. For many years, in-store theft prevention systems have relied on RFID-tagged merchandise to snare shoplifters. More than 6 million consumers also carry RFID tags on their key chains in the form of ExxonMobil Speedpass tokens. The device, when waved in front of a gas pump-mounted reader, sends an ID code that allows the merchant to deduct the purchase amount from a linked credit card or checking account. "It’s a great application," says Joe Giordano, vice president of Speedpass network business and product development at Exxon Mobil in Dallas. "I think it could benefit any retailer, particularly retailers who have convenience-type transactions."

Tiny, cheap tags will allow the efficient tracking of even the smallest items, such as overnight letters and packages. An RFID tag attached to a letter would not only tell a shipper the package’s current location but also where it’s been and where it’s scheduled to go. "Pieces of mail will probably wait until [tag prices] get down to one or two cents," says AMR’s Abell. Back at home, miniature tags?perhaps in the form of an implantable chip?will allow pet owners to affordably and conveniently track the movements of Fido and Fluffy. "[Wild] animals have been tracked with RFID for a long time," says Abell. "They even put them on hummingbirds."