Ready for take off
Analysts see growing opportunities for <@SM>RFID, wireless security in 2005
- By Doug Beizer
- Jan 06, 2005
Input's Payton Smith said the Defense Department will be implementing a lot of RFID in 2005.
RFID and wireless security technologies will get a big push in 2005, thanks to developments that likely will spur new investment and growth in both areas.
The Defense Department's RFID policy goes into effect this month, requiring the department's suppliers to put passive radio frequency identification tags on every case or pallet they deliver. The program is designed to improve the agency's management of inventories on everything from food to medical supplies.
The Defense Department "has moved from a transition year in 2004 with RFID to a year in 2005 where we're really going to see a lot of implementation of that technology," said Payton Smith, manager of public-sector market analysis services for Chantilly, Va-based market research firm Input Inc.
For wireless security, two factors will be in play: the National Institute of Standards and Technology's new Federal Information Processing Standard (FIPS 140-2), and the new IEEE 802.11i standard.
The built-in security these standards provide likely will lead to more investment in wireless networks, said Ann Sun, senior manager for wireless and mobility marketing at Cisco Systems Inc.
The standards, along with efforts from groups such as the WiFi Alliance, also will lead to greater interoperability among wireless products in 2005, Sun said. Interoperability will lead to more investment.
"For an end user, like a government customer, the good news for them is they can be more assured of having built in security standard in the product lines being offered," Sun said. "For system integrators, the key here is a lot of customers still need a good amount of education on how to design and deploy a secure wireless system as a whole, not just access points."
Mukesh Lulla, president of TeamFI Inc., a developer of embedded networking and security software, agrees that adoption of the standards, particularly FIPS 140-2, will lead to a sharp increase in spending on wireless solutions for government and private business enterprises.
"Our security protocol can run on top of wireless, and we're working at other protocols that deal specially with wireless," Lulla said. "We expect this space to explode in 2005."
Lulla, whose company is in Freemont, Calif., said he expects vendors that supply network and telecommunications equipment will be among the first IT businesses to focus more on FIPS 140-2.
For systems integrators, one key to success in wireless security will be the ability to develop solutions for government agencies that address specific needs, Input's Smith said. Integration will be required on everything from back-end systems to handheld devices.
Look for wireless security technology to evolve much like security evolved in wired networks, Sun said.
"On the wired side, it was all about firewall, but these days the protection is so much more sophisticated," Sun said. "Security is about intrusion detection, it's about signatures, it's about viruses. I think we're seeing a similar evolution on the wireless side."
Demand is increasing for intrusion detection services and rogue AP detection services for wireless networks, she said.
"That's another opportunity for system integrators to either run that as a services offering or to provide a system for an end user," Sun said.
A similar evolution happening with RFID could lead to opportunities, said Michael Dominy, an analyst with the Yankee Group in Boston.
"I think for the first half of the year, most companies ? people that supply the Defense Department or Wal-Mart, for example ? are not going to bother with very much data integration with RFID. They'll just get by with the bare-bones requirements," Dominy said. "In the second half of the year, I think we'll see an increase in the integration activities that occur between the RFID data stream and the enterprise application layers."
Payton Smith agreed that RFID would expand quickly beyond supply-chain applications. Assets management is a likely area where the technology will migrate as well, and that could be a boon for integrators working in the federal government space.
Where supply chain for the Defense Department is unique among all the federal agencies, assets management is something all agencies must do.
As suppliers increase their use of RFID, there will be a greater demand for robust RFID solutions. Dominy said he expects that demand to be strong in late 2005 and in 2006.
"The important thing for any systems integrator dealing with RFID, or is trying to provide RFID services, is to help suppliers develop a migration plan that lets them incorporate RFID at a rate that meets their customers' requirements," Dominy said.
System integrators that expect suppliers to adopt RFID full bore with systems in the $20 million to $50 million range likely will be disappointed. Suppliers are more apt to spend as little as possible in adopting the technology.
"My advice to system integrators is to provide a logical migration path that lets the organization ramp up at a rate that makes sense," Dominy said.
Staff Writer Doug Beizer can be reached at firstname.lastname@example.org.
Doug Beizer is a staff writer for Washington Technology.