Total revenue earned from RFID transponders, readers, software and services will amount to more than $5.6 B in 2009, according to the latest market data from ABI Research.

“The recession has had an undeniable effect on deployment plans,” notes Practice Director Michael Liard, “but despite some project deferrals and terminations, there will be market growth, albeit fragmented.”

The RFID market continues to be worthy of cautious optimism in the near to mid-term, particularly in the closely-watched passive UHF segment. "Although the RFID market faces economic challenges, ABI Research would not characterize it as being in a state of despair or turmoil. We do not anticipate near-term market contraction based on economic conditions; however, anticipated growth rates may not be as robust as in previous years.”

“In fact,” Liard adds, “many industry participants contacted by ABI Research feel current conditions are challenging but may only represent a small bump in overall RFID adoption. However, there is a sense that vendor performance and end-user activity during Q1 and Q2 2009 will be critical bellwethers for overall near-term RFID market growth within traditional and modernizing applications.”

ABI Research believes that under current conditions RFID technology is best positioned as a cost-saving solution among enterprise users. As a result, RFID vendors and their channel partners must play a more proactive role in communicating the value proposition and total cost of ownership of RFID during these tough economic times and beyond.

The firm cautions that the impact of wider economic forces is often not immediate, however, and expects to be in a better position to gauge how the economy is really impacting near-term RFID adoption and spending in the second half of 2009.

ABI Research’s new study, ”RFID Annual Market Overview,” provides a comprehensive, detailed overview of radio frequency identification (RFID) technologies, applications and addressable vertical markets. It is intended to provide an actionable outline of the broad RFID market. It includes forecasts for RFID transponders, readers, software and integration services.

The report is part of the firm’s RFID Research Service, which also includes other Research Reports, Research Briefs, Market Data, ABI Vendor Matrices, ABI Insights and analyst inquiry support.