18 Jun 2009
The European Commission has announced plans for Europe to play a leading part in developing and managing interconnected networks formed from everyday objects with radio frequency identity (RFID) tags embedded in them - the so-called "internet of things".
The Commission has launched a 14-point action plan to address the issues raised from such widespread interconnectivity.
"New examples of applications that connect objects to the internet and each other are created [everyday]: from cars connected to traffic lights that fight congestion, to home appliances connected to smart power grids and energy metering that allows people to be aware of their electricity consumption," said EU Commissioner for Information Society and Media Viviane Reding.
The EC expects there will be a progressive connection of a variety of physical objects, and not just computers – creating the ‘internet of things’. These could be everyday items such as food packaging that records the temperature along its supply chain, or different prescription drugs that warn patients of a possible incompatibility.
To meet the challenges raised by such interconnected objects, the EU's action plan aims to help "Europeans benefit from this evolution and at the same time address the challenges it raises such as privacy, security and the protection of personal data," according to the Commission.
The plan's major concerns are related to governance, privacy, data protection and the emerging risks which could potentially surface as new RFID technology is rolled out into ever-more consumers devices and products.
European statistics body Eurostat will start publishing RFID usage statistics in December, and the Commission will gather a representative set of European stakeholders to monitor the evolution of the "internet of things".
But one problem which could stymie widespread RFID use is the lack of an IPv6 rollout, which would be needed to cater for addressing many millions of objects.
"[IPv6] sets the conditions for RFID's widespread take-up, allowing objects such as household items to have their own internet protocol addresses to connect to other devices," said the Commission.
So far, the retail industry and its supply chain have benefitted most from RFID. However, it's time that more market sectors considered its potential for tracking corporate assets, in particular those of high value appearing on the balance sheet.
Under growing scrutiny, both the private and public sector need improved asset management, traceability and accountability. Using RFID, line managers can conduct a physical audit scanning hundreds of assets simultaneously, from a single point, with zero impact upon the organisation's core operations. Also, tight integration with the full asset history ensures unprecedented accuracy and auditability of the entire asset register.
From highly mobile items such as laptops, to heavy machinery composed of multiple component parts that are frequently changed by maintenance without being recorded, organisations often have no idea what happens to assets day to day.
Upwards of 50% of assets on most registers are no longer in use and organisations risk over-paying insurance premiums, creating mismatched disaster recovery plans and even inaccurate company valuations. This needs to change, particularly in a tight economy.
New International Financial Reporting Standards (IFRS) demand fixed asset management accountability and a full audit trail. With IFRS becoming increasingly prevalent, the spotlight is focused on the poor management processes that have resulted in these highly inaccurate asset registers.
RFID technology has the potential to transform the entire asset management process, impacting on business continuity, disaster recovery and corporate governance.
Yours sincerely,
Karen Conneely
Group Commercial Manager
Real Asset Management
www.realassetmgt.co.uk
Posted by: Karen Conneely 25 Jun 2009
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