Series of firms win Defense contracts to provide new RFID technology

A group of firms has won contracts worth a total of $428 million to provide active radio frequency identification technology tags, readers, systems and services to the Defense Department in a procurement designed to bring competition to a field long dominated by a subsidiary of contracting giant Lockheed Martin Corp.

Now, Northrop Grumman Corp., Systems & Processes Engineering Corp. and Unisys will join the Savi Technology division of Lockheed Martin in providing the technology.

The RFID III contracts awarded on Dec. 19 by the Army's Technology, E-Commerce and Commercial Contracting Center also will provide a wider range of RFID tags than Savi supplied under previous contracts. And the tags will operate under International Organization for Standards 18000-7 standards, rather than by using proprietary Savi technology.

Since 1994, Defense has established a global network to use active RFID technology to track cargo in containers, providing it with visibility into its supply chain that was lacking in the first Iraq war.

Active RFID tags are powered by a battery and can be read at a range of 300 feet. Passive tags, which Defense uses to identify cases and pallets of supplies, do not have batteries and have a shorter range.

When tags are read, the contents of a container are identified and transmitted over Defense networks to logistics databases the four services and the U.S. Transportation Command maintain.

Demand for active RFID tags and readers in the Defense Department is so strong that in February, the Army raised the ceiling on its RFID II contract with Savi -- which expires next month -- by $60 million, to $483 million.

The active RFID tags Savi currently supplies come equipped with 128k of rewriteable memory. The new contracts call for the vendors to provide a wide array of tags, ranging form a simple digital "license plate" tag identifying a container to tags with up to 512k of memory, said Sam McClintock, manager of the Northrop Grumman Automated Information Technology Center in Williamsburg, Va.

The contract also includes an inexpensive tag with a nonreplaceable battery, which McClintock described as a "throw-away" tag, and security tags that record when a container door has been opened or closed during transit.

Phil Toler, vice president for strategic plans and products at SPEC, said vendors on the RFID III contract also will supply environmental tags that can record temperatures inside refrigerated containers.

Toler said he expects strong demand on RFID III for license plate tags due to their inherent security. A potential adversary equipped with a handheld RFID reader would be able to determine only the number of a container equipped with such a tag, and not gain any information about the contents of the container.

While Savi now faces competition on RFID III, the other companies involved still will have to license intellectual property from Savi to meet active RFID standards.

Toler said he believes that competition on RFID III will be good for all the vendors, including Savi, and also will benefit users throughout Defense and at other federal agencies, which can buy off the contract. RFID III has two base years for ordering tags, readers and services and another three option years. There are also options for another five years for maintenance.