Intermec-let the RFID cycle begin
Below is a MRR and PLR article in category Finance -> subcategory Investing.
Intermec: Ushering in the RFID Era
Summary:
RFID ?" A Booming MarketIntroduction
A groundbreaking technology called Radio Frequency Identification (RFID) is revolutionizing item tracking. Unlike traditional bar code systems, which require individual scanning and are labor-intensive, RFID enables a two-way communication system that simplifies inventory management and tracking.
RFID: The Future of Tracking
RFID technology allows for a comprehensive scan of all items in a store like Wal-Mart with RFID tags that respond to a reader. This innovation minimizes manual labor, enabling a single person to inventory an entire store. Forklifts equipped with RFID readers can track every item moved into a warehouse, significantly enhancing efficiency.
Potential Applications
RFID is versatile with countless applications:
- Monitoring gamblers at a casino
- Tracking prisoners in correctional facilities
- Verifying prescription drugs to prevent counterfeiting
- Identifying stolen vehicles or those with outstanding issues
Industries ranging from retail to aviation can leverage RFID for seamless manufacturing, inventory, and retail operations.
Market Growth and Forecast
According to IdtechEx, the RFID market is expected to soar from $2.7 billion in 2006 to $26.2 billion by 2016, growing nearly tenfold.
Intermec: Leading the Charge
Identifying the right company to dominate this burgeoning market is crucial. Intermec is at the forefront, with over 149 patents contributing to the Gen 2 RFID standard. This strategic positioning could grant Intermec a quasi-monopolistic status.
The Power of Monopolies
Historically, companies like Microsoft and Intel have thrived by controlling market standards. Intermec's patents and integration with Gen 2 standards position it similarly, emphasizing significant industry influence.
Industry Validation
Intermec's claims are substantiated as major industry players like Philips Electronics and Texas Instruments have agreed to pay them royalties, recognizing Intermec’s pivotal role.
The Gutter Business Model
Intermec exemplifies a "gutter business model," collecting revenue from widespread industry dependency on its technology. This model grants it leverage akin to a gutter channeling water from a roof.
Risks and Uncertainties
Although Intermec leads with the Gen 2 standard, its future in Gen 3 remains uncertain. Legal challenges or potential allegations of monopolistic practices could also pose risks.
Conclusion
In summary:
1. RFID is entering a phase of explosive growth.
2. Intermec is a technological leader with significant control over the Gen 2 RFID standard.
3. Its business model and potential monopoly position could transform the industry.
If successful, Intermec could achieve what we call a "Modern Monopoly Effect," attaining market value comparable to its industry partners combined. This unique positioning could set the stage for remarkable growth and influence in the RFID domain.
You can find the original non-AI version of this article here: Intermec-let the RFID cycle begin.
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