The challenge

RFID is a key technology in the fields of ICT  for the European industry. Although no longer an emerging technology, the breadth of its potential application and the number of open issues on their way to full implementation and market acceptance still require substantial R&D support in many domains. A European research policy is an important enabler to realise the full potential of RFID.

When setting up a research policy, a decision about the “what” and the “how” is essential i.e. which topics should be supported and what the support should look like. In addition to the content of technological and societal research, and the creation of tools, measures and infrastructure to implement, another important issue is to have the means to transform research findings into economic benefits for the widest possible selection of stakeholders, e.g. companies, customers, consumers, governments etc.

There is a general impression amongst the players in the RFID value chain that programmes and measures to support RFID are few and not always aiming in a supportive direction. Therefore, in this chapter we assess the current RFID R&D policy in Europe via its present implementation, the European and national RFID R&D programmes , compare this current status with the requirements as perceived by the providers and users of this technology, and make recommendations as to the content and the way of implementation of an optimised European RFID R&D policy.

In order to have a consistent method of work, we first had to define criteria to assess the present subsidy programmes and projects. These criteria divide broadly into two categories. Firstly, general programme characteristics were analysed, such as:

• Do programmes exist?
• Are they accessible for all potential participants (large companies, SMEs, academic institutions) or do they focus on certain sectors (e.g. SMEs)
• What is the probability of a successful application?
• Does the programme support single companies or are consortia required?
• Are these thematic programmes/call systems or are they open for any topic?
• Does it cover all phases of innovation all the way to market introduction, or are there restrictions (e.g. only applied research etc)?

Specific criteria relating to needs and necessities for RFID were also used in the analysis. One of the most important points that had to be addressed was establishing whether the programme and subsequent projects addressed the main bottlenecks which hinder the application of RFID. In order to establish this, analyses of these bottlenecks had to be carried out. Extensive study of literature identified d the following bottlenecks:

• technological challenges in the tag /reader system
• the lack of consistent business models, especially for the SME´s in the RFID value chain
• unsolved or inadequately addressed data security and privacy issues

Major results/recommendations 

Create and support an open innovation environment

An open innovation environment  is characterised by:

• Close cooperation and frequently co-location of research institutions, large companies and SMEs.
• Rapid flow of ideas up- and downstream the R&D chain: Successful innovation requires interaction and iteration.
• Concurrent activities in research, development, prototyping and market testing activities.

In such a setting it is rather difficult and very counterproductive to differentiate between programmes according to the state aid classification as to maximum permissible aid. Recent developments in the state aid issue show clear improvement over the older, more restrictive rules.

To make such a cooperation successful, it needs critical mass of academic and company R&D personnel, a trusted environment  as to IPR  issues, and stable rules of cooperation, including funding and financing for medium- until long-term. We therefore think that all measures that enable and support industry and academia cooperation are of paramount importance to create this open innovation environment.

Concrete measures in support of such an open innovation environment are:

• not discriminating specific partners, e.g. large companies by excluding them up front from the participation in certain funded programmes.
• defining programmes dealing with the creation and operation of a European research infrastructure in a way to solicit and increase the participation of industry.
• allowing/encouraging national support for regional cluster formation, e.g. by national support for infrastructural measures

Support Europe-wide RFID deployment

Our analysis has shown that the particular focus, emphasis, or support concerning RFID technology and application differ widely across Europe. New Member States and CEE  (Central and Easter Europe) countries seem to lag behind, especially in pre-competitive applied R&D programmes . On the other hand, in order to reap the benefits of this technology, a Europe-wide balanced introduction is needed in many areas, e.g. public transport, international logistics and supply chain  management , public security, or healthcare  etc. The current Framework Programme (FP7) will most likely not be able to close this gap on its own, although that companies and research institutions from CEE countries participate in framework projects.

Europe should check which instruments in its R&D and innovation policy portfolio are suited best to stimulate regional participation in this development. One of the likely candidates amongst the EU programmes for that endeavour is the Competitiveness and Innovation Framework programme (CIP) (CIP 2007), more specifically the ICT Policy Support (ICT PSP) part of the programme.

Provide balanced support for R&D themes and topics 

Answers to the3 specific content-related bottleneck criteria chosen for our analysis (technology / Business Case and ROI /Privacy & data security) will have to be found both in short term/high urgency and medium/long term R&D  programs .programs in both time horizons should be eligible for national and European funding.

Concerning the point how support should be given to be most efficient, we recommend the following measures:

• improve the coherence between RFID related projects and support programs by creating permanent RFID related project clusters. Suitable vehicles in this respect are European Technology Platforms with an RFID-related focus in their Strategic Research Agenda (eg ARTEMIS or EPOSS)
• solve the  problem of not having a central competence repository accessible for all players in the value chain We recommend that national or European authorities will (co-)finance application labs in form of public-private partnerships in order to support testing, validation and certification of technologies and concepts, and to generate relevant information relating to business case issues.
• improve  public acceptance of RFID  technology and its applications by linking support for RFID (both in research and application development) to its contribution to solutions for major societal problems, e.g. in the fields of healthcare , security, or environmental management, and by underscoring the importance of privacy by sponsoring additional specific (and not exclusively technology-oriented) programmes.

Support “go to market” of novel applications

European initiatives in supporting R&D and innovation mostly deal with the “supply side” of innovation i.e. creating and supporting R&D infrastructures and generating technological competence but rarely deal with the “demand side” for those innovations. If, for various reasons, there is little demand for new products and processes, there is little interest in investing in the input side.

In line with the core of the recommendations of the so-called Aho Report (Creating an innovative Europe) and the so-called Wilkinson Report (Public Procurement for Research and Innovation), stating amongst other topics the need for Europe to provide an innovation-friendly market for its businesses, with actions on regulation, standards and public “procurement for innovation”, we recommend  that Europe takes the initiative to promote RFID applications in areas of societal importance e.g. drug authentication, efficient logistics  and transport, automotive industry, or transnational use of eGovernment  techniques by supporting the application of RFID–based solutions.