Here's a bombshell. A representative of a major research house had this to say recently while talking about the state of the RFID market in an article at Destination CRM:

"One of the biggest tragedies of RFID was that when it was introduced it was called the next barcode," says Jeff Woods, a Gartner research vice president and author of the report. "People looked at where barcodes were being used and tried to supercharge those processes with RFID. It turns out that replacing barcodes is actually one of the hardest processes for RFID to make a successful business case." This is because barcodes are extremely cost-effective and easy to grasp when implemented as inventory identifiers in structured settings like warehouses, while the true benefit of RFID--real-time tracking of movable assets in chaotic environments--is largely wasted in those cases.

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Woods identifies the settings where RFID is best deployed as those where it's important to be able to locate an asset quickly, easily, and accurately, regardless of whether it is in sight. "The trend we've seen in business cases is that there are two characteristics that make great implementations," Woods says. "These are mobile Asset Tracking and business processes for chaotic environments." One example is a hospital ER, "where it's easy to lose track of a wheelchair or an IV pump," he says. The FDA also has found a place for RFID in fighting counterfeiters and black marketers, and the DOD has been a major driver of RFID technology adoption for logistics and asset tracking.

The report goes on to note that the RFID market is expected to grow to $3 Billion worldwide in five years (by 2010).

Apparently from spending on those inventory applications that are a waste. Heh.

UPDATE: Reader Timothy Plakhty writes that he has translated the Destination CRM article into Russian. Go here for the Russian text.