IT asset tracking set to explode as more sectors seek RFID solutions

03/08/10 | John R. Johnson | email

One of the hottest sectors for RFID technology in 2010 looks to be the tagging of IT assets at financial institutions and federal agencies, where close to a million assets could carry RFID tags by year end. Almost half a million IT assets were tagged last year.

So it’s a good bet that the total number of tagged IT assets will exceed one million this year, which represents solid growth in the sector. Big banks like Wells Fargo, Bank of America, Chase and Citibank have either already finished data center tagging projects or are in the midst of completing them. Some large banks have dozens of data centers with tens of thousands of items like servers, blades, and laptops being tagged. Banks that decide to tag items like storage tapes could add several hundred thousand more products to the mix.

“The value of these assets is so incredibly high and many of these assets are getting lost,” says Joe White, chief operating officer at RFID Global Solution, which is also working on a deployment at a major bank with 99,000 assets. “As technology has evolved and the amount of data and information that can go onto a server or blade or network device has increased, the value proposition around tracking it and knowing where that stuff is has also increased.”

However, the trend isn’t entirely bank-centric. Branches of the federal government are rapidly implementing both passive and active RFID to tag assets at data centers located along the Beltway loop around Washington D.C. Other industries, like insurance and computer storage, also have large numbers of IT assets. Search engines like Google, cable companies, and pharmaceutical manufacturers are also pursuing the technology.

“There are a lot of different organizations in different stages of tagging,” says John Fricke, who heads up the Financial Services Technology Consortium, a group consisting of technology vendors and financial institutions. “When you think about all those organizations, there is an awful lot of equipment out there. Plus, most organizations have just started tagging laptops to read them as they go in and out of the building, and many are looking at tagging cell phones as well.”

IT manufacturers like IBM, Dell, HP and Sun already have programs in place to affix RFID tags to IT assets before they ship to customers. Dell appears to be the early leader for providing that service. However, as IT asset tracking grows in popularity, it could be a victim of its own success as new industries seek to adopt the technology. Fricke says that manufacturers would like a consistent tagging pattern for all industries, and will not tag assets one way for the pharmaceutical industry and another way for the financial world. The gains from IT asset tracking can be staggering. Fricke has seen productivity gains as high as 90 percent in the banking sector, which can eliminate labor-intensive manual inventorying by using an RFID solution.

In late 2008, the FSTC published a set of guidelines for implementing RFID-enabled solutions to track data center assets in the financial industry. (See RFID 24-7, Jan. 5, 2009). The benefits of tagging at the point of manufacture are many. For starters, it eliminates the need to tag assets themselves. Pre-tagging also allows banks to trace assets before they arrive by tracking advanced shipping notices (ASN). And when pre-tagged assets arrive at the loading dock, financial institutions know what they are and when they were received. Back end systems that track receipt of goods, start depreciation cycles, billing and accounts payable can then all be triggered automatically.

In a previous interview with RFID 24-7, Mike Russo, senior vice president of Automated Identification Technologies at Wells Fargo, said that his firm�s tagged assets could increase from 40,000 to well over 100,000 by having them pre-tagged by the manufacturer. However, the company told RFID 24-7 this week that do to its focus on integration activities, Wells is currently re-evaluating how it will use RFID going forward.

While the banking industry is mostly relying on passive RFID technology, government agencies that want more granular information on assets are turning to active solutions. Diana Hage, CEO at RFID Global Solutions, says that two large government agencies are using her firm’s active Visi-Trac solution to track assets. One agency, which provides IT support to the White House and other branches of government, has tagged over 15,000 IT assets and 3,000 personnel for access control, chain of custody and asset security at multiple facilities.

Active RFID, while more expensive, can go above and beyond passive technology by identifying whether certain employees have rights to certain assets, and by dictating how close employees or visitors are allowed to assets, usually drilling down as close as 12 inches.