RFID and Airlines
- RFID Connections
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RFID Connections interviewed Scot Stelter, Director for Product Marketing at Alien Technology, on the value of RFID for air travelers.
Scot's views can be heard by clicking on the “podcast” in the article. So if you don’t have time to read the entire interview now, download it onto your iPod/MP3 player and listen in on your way home.
Note: Written transcript has been edited from audio interview for grammar and syntax.
RFID Connections: There has been a lot of talk about the potential for RFID in the airline industry. Could you briefly describe how RFID could be used to improve both the traveler experience and airline efficiency?
Scot Stelter: I think most passengers say that, when they've had problems with the airlines, they generally fall into two broad categories: one is delays and the other is issues with baggage -- and RFID can address both of those.
First of all, many delays have to do with lost or missing baggage. A very good example is when someone is making a transfer from one plane to another and there's a direct transfer of the baggage from that airplane to they're going to -- and it doesn't necessarily even go through the airport facility. Being able to rapidly and accurately transfer a bag from one plane to another -- plane-to-plane -- means that not only is it more likely that your bag is going to find its way to your destination but it also means that the plane you're waiting in while your bag and other peoples' bags are physically being trucked across the tarmac and loaded into your plane is going to sit on the tarmac for less time.
As I understand it, the typical delay in airlines -- which is on the rise by the way -- is something like 17 minutes per flight. And much of that time is spent sitting in your seat waiting for somebody else's bag to get loaded into the plane because their plane coming in was late. If that can be sped up your wait can be reduced. So that's one example.
Other examples include the obvious security issues. Obviously we're all concerned about security and we would like to see our safety enhanced yet, at the same time, we don't want to be inconvenienced by it. And being able to efficiently flag bags that need special treatment, so-called selectees, and divert them for that treatment without impacting the flow of other bags is a way of contributing to that.
In addition, there are some things that don't affect the actual airline passenger are functions within the airport such as cargo. Cargo is another security issue recently the federal government passed a new law under the Homeland Security Act requiring that within three years all cargo be searched for security reasons. And this obviously has a somewhat less tangible but still very important benefit to the traveler.
Baggage tracking is obviously something that's very important to the individual traveler but, from the airline's perspective, is baggage tracking and lost luggage a major problem?
There are approximately 2 to 2.2 billion airline passengers a year and about 100,000 bags per day go missing for some period of time with, ultimately, some of them going missing permanently. That means that, for every thousand passengers, about twenty bags are lost. That's a huge number and, in fact, one large North American airline recently reported that it lost $60 million in one year due to baggage tracking issues.
This varies widely from airline to airline but the data suggest that if the top 80 airlines in the world impelemnted RFID, the benefit would be somewhere on the order of $200 million per year and this would be at a cost of about a $200 million investment over five years. Basically what you would see is a very rapid ROI, a very rapid payback and then an ongoing annuity of savings for those airports. Now, if all the airports in the world implemented RFID in their baggage tracking something on the order of $800 million in savings per year could be achieved. This is according to IATA, the International Air Transport Association.
You bring up a good point. Having RFID baggage tracking for an individual airline is good but what about the situation where I have to change airlines when I change planes? Is there any progress being made in promoting interline use of RFID?
The good news in that area is that a lot of work has been done. IATA, in conjunction with EPC, have put together a number of standards that govern such things as data format on tags and physical format of tags for use in baggage tags.
So, for example, today there are two airports in the world -- Hong Kong is one and McCarren in
One of the practical aspects of using RFID in a baggage world is that what you'd like to do, in the long run, is put a lot of extra data on the tag so that you reduce the frequency with which you have to refer over a network to a database and standards to define those data models are being worked on now as well. And as tag technology improves, the ability to deliver the extra memory required for those applications at a still very attractive cost is being improved.
So, it looks not only do we have a really good standard for use in developing the business models and the usage models and the business process now, we also have a path in the future toward a very effective improvements in the technology as it rolls out to airports around the world.
Can you provide any other examples of current or potential RFID use in airports other than baggage tagging?
Yes, absolutely. Probably the hottest growing market segment for RFID applications in the world right now is what I would call a "super segment" which is asset tracking. Asset tracking finds its way into applications inside and outside of the airline industry with a huge range of different characteristics -- from the smallest indoor office asset to trucks in yard management applications. The airline industry has the same sorts of things and a great example are the trolleys that are used to move food and other supplies into and out of the airlines.
Another example are the utility vehicles that are used to carry baggage to some of the larger aircraft and the entire unit filled with bags is actually lifted and put into the airplane itself. These assets tend to be shared, they can be lost, they need frequent maintenance -- basically they need significant levels of management in order to be used effectively and cost effectively. Tagging them with RFID so you can track their maintenance schedules and know where they are is very beneficial and beings the same benefits to the airline industry that asset tracking brings to industries all around the world.
You mentioned cargo both in terms of Homeland Security as well as items that would go into the Unit Load Devices that go into the aircraft itself. Are there any particular applications for RFID for cargo?
Yes, absolutely. Recently, a new law was passed called the 9/11 Commission Act of 2007 which requires, among other things, 100 percent scanning of air cargo coming into and out of American airports within three years. In order to do this, a significant effort in tracking these pieces of cargo so that it can be ascertained whether or not they've already been searches and what the outcome of that search was, where they're coming from, where they're going to and so on needs to be mounted. There needs to be a lot of investment in putting this together. As a result, there will be a significant infrastructure investment to accomplish this and RFID equipment will be part of that infrastructure investment.
RFID Gen2 [UHF] technology will be very useful in tagging and tracking these pieces of cargo.
In terms of Homeland Security and anti-terrorism, the
This is a very important Act. What it does essentially is it provides encouragement to companies to invest money in the development of this technology because we obviously need to develop this technology very rapidly. Should there be a terrorist event, companies are indemnified and therefore cannot be sued if they have provided technology for use in these security applications. What this essentially does is, it enables companies to find the funding at a lower level of risk to invest in the technology and, therefore, get the technology designed and deployed more quickly. That's better for our country.
For Alien, it's been beneficial because we're one of the few companies that has been certified under this Act. Our Quadratec subsidiary was recently certified -- I believe it was the fourth company certified under this Act and so we're now taking advantage of that and using it to enable ourselves to develop this technology more quickly and get the funding we need to do so.
In closing, is there anything else you think our listeners should be aware of?
I think I would just say that it's going to take a few years for this technology to be implemented but, in the long run, customers will benefit in both tangible and intangible ways.
First of all, from the intangible perspective, we'll all be a little bit safer and that's always a good thing.
More tangibly, we'll be able to achieve that level of security with less impact on our daily lives. It'll be a little bit easier to get to the airport for that early morning flight, you won't have to get there quite as early, your luggage will get through a little more quickly, it'll get to its destination with a little more regularity so, in the end, it's going to be easier and more effective for everybody.
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About Scot Stelter
Scot Stelter has been the Director of Product Marketing for Alien Technology, a leading provider of RFID products, since 2003. Prior to joining Alien Technology, he held marketing posts at Alegion Corporation, a supply chain collaboration software company, and Adaptec, a leader in computer peripheral I/O technology. Before his marketing career, Mr. Stelter designed signal processing electronics for several
About Alien Technology
Alien Technology is a leading provider of Radio Frequency Identification (RFID) products and services to customers in a wide variety of industries. Organizations use Alien's RFID products and services to improve the effectiveness, efficiency and security of their supply chains, logistics and asset tracking operations. Alien's products include RFID tags, RFID readers and related training and professional services. Alien's patented Fluidic Self Assembly (FSATM) technology and related proprietary manufacturing processes are designed to enable the manufacture of high volume, low-cost RFID tags. Alien was founded in 1994. The company's facilities include corporate headquarters in Morgan Hill, CA; an RFID tag manufacturing facility in Fargo, ND; the Alien RFID Solutions Center in the Dayton, OH; and sales offices in the US, Europe and Asia. Alien is a member of EPCglobal. More information about Alien is available at www.alientechnology.com
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