An AIDC Renaissance?

Suddenly, AIDC (automatic identification and data collection) VARs and integrators are in the spotlight - again. Vendors of all shapes and sizes have been fawning over channel companies for the past year with new incentive programs, all claiming to reward/encourage solutions selling rather than box moving. Zebra, Symbol, Psion Teklogix, Intermec, and HHP are just a few of the companies with these types of programs.

Indeed, these are good times for VARs, at least in terms of popularity. Don't get me wrong; I don't mean to imply vendors have been ignoring their indirect sales buddies. They haven't. But this current wave of extra love for all things channel, which happens every few years, is definitely a shift from the direct sales focus many companies have adopted in recent years. Partner conferences, some of which have been discontinued in recent years, are not only being resurrected (e.g. Datamax and DNP are both planning 2004 events after a hiatus in 2002), but are growing in size (e.g. BlueStar's VARTech conference had twice the number of exhibitors of last year's event). Additional channel managers are being hired (e.g. Symbol, Honeywell) and direct sales forces are being instructed (again) not to compete with channel companies.

RFID Is Ready; Are You?
All the attention the channel is receiving isn't the only bright spot on the AIDC landscape. RFID (radio frequency identification), everyone's favorite technology-to-talk-about-but-not-to-implement, is continuing its upward crawl toward mainstream acceptance. In fact, RFID has actually dethroned biometrics as the technology that can make privacy advocates hyperventilate the fastest. C'mon, RFID systems are designed for stuff like improving inventory visibility, not tracking a person's whereabouts 24/7. For that you have to work for the government (just kidding), which by the way, was one of the first adopters of RFID.

Surveys of VARs and end users alike are yielding promising results that indicate an impending RFID watershed. For instance, earlier this year AMR Research surveyed retail and consumer goods executives about their plans to adopt RFID. While only 10% of the 250 respondents said they were currently using RFID, 63% stated they were evaluating the technology. Similar results were found at the first RFID World conference this year that attracted 500 attendees. Of 50 attendees at Texas Instruments' RFID boot camp held during RFID World, more than half stated their customers were requesting RFID solutions.

Other recent market developments seem to support the contention that this technology is finally getting the attention it deserves. Probably the most important validation was when Wal-Mart told its top 100 suppliers to adopt RFID technology by 2005. Although this wasn't the type of application that makes hard core item-level tracking supporters salivate (the company will use the technology for pallet- and case-level tracking only), it was still a big win.

Speaking of big wins, RFID vendor Matrics received $20 million in financing from a group of investors in July. Truly, in today's economy, that's a lot of faith to have in a technology's potential.

WLANs, FFA Solutions Offer More Opportunities
New channel programs and RFID market growth are only two of the current encouraging signs for AIDC VARs and integrators. New 802.11 wireless LAN standards continue to fuel customer desire for new - and replacement - wireless data collection systems. VARs like Mobile Computing Corp. (MCC) (Toronto), which is featured on page six, are capitalizing on field force automation (FFA) solutions. In fact, FFA solutions accounted for approximately 80% of the company's 2002 $12 million in sales.

There are signs indicating the long-frozen IT budgets are beginning to thaw. So, take advantage of those new partner programs and start investigating new technologies now while you have the chance. Hopefully, we are on the cusp of an AIDC resurgence.