RFID is Finding a Home in the Data Center

Computerworld — Employees used to form a line at Wells Fargo Bank's Roseville, Calif., data center at the end of each workday, as they waited to present their laptops to a security guard, who would check each serial number against a list linking the laptop to a specific person's name.

In 2007, Mike Russo, senior vice president of automated identification technologies, decided to try to speed up that security process and test the value of radio frequency identification technology. "We put an RFID tag on the laptop and a picture of the individual in the database," he says, "so all the user has to do is pass the laptop over the RFID scanner and a picture of them shows up on the security guard's screen."

The new system sped up the checkout process and proved so popular that soon it was expanded to five other data centers.

Russo started looking for other ways to use RFID technology. Among other things, he replaced a time-consuming bar-coding system that had been used to inventory IT assets such as servers, racks, network switches and peripherals.

"We have tagged 40,000 assets in our core data centers so far," he says, adding that an inventory process that used to take weeks using bar code scanners can now be done in a single day.

"Financial institutions using RFID are seeing on average a 90% decrease in the amount of time it takes to inventory their IT assets," says John Fricke, chief of staff at the New York-based Financial Services Technology Consortium, which has worked to establish a standard method of RFID tagging for IT assets. "Data centers replace their equipment on average every four years, and it is a significant spend. Customers are starting to say to vendors, 'If you can supply equipment pretagged with RFID, we'll be more inclined to buy from you.' "

RFID tagging could also make the merger-and-acquisition process much easier for IT groups, Fricke says. "There's a lot of time and energy involved in trying to find out what the acquired company's assets are and verifying that they exist."

Data centers currently make up a very small part of the RFID asset-tracking market, but as the early adopters in the financial sector report cost savings and security gains, IT leaders are taking a second look. ABI Research in Oyster Bay, N.Y., predicts that IT asset tracking will account for more than 10% of the RFID market by 2013.

RFID vendors and integrators are tailoring offerings for the data center, and vendors such as IBM and Hewlett-Packard Co. are starting to pretag equipment. A complete system for an individual data center might start at $50,000, according to RFID vendors' Web sites.

Using bar code scanners to track assets is both time-consuming and inaccurate, says Bill Conroy, senior vice president and infrastructure optimization executive at Bank of America Corp., which last year switched to RFID in 17 data centers.

"With bar-code technology, it took two weeks to inventory a whole data center," he says. "Now we can do that in one day and get 100% accuracy. That is a significant ROI."

Raths is a freelance business writer in Narberth, Pa. Contact him at draths@mac.com.