Mention RFID a couple of years ago and most would think about pallets of goods moving through warehouses. When the cost of RFID tags was high, it made little sense to do item-level tagging so goods were tagged at the container, pallet and carton levels. That was RFID 1.0, if you will. The leading company at that time was Matrics–an investment of ours, which we sold to Symbol (now part of Motorola). RFID 2.0, for lack of a better name, is built around UHF Gen 2, an ISO standard which is better suited for item-level tagging. The transition from RFID 1.0 to RFID 2.0 is well under way, partly enabled by the technology of another Polaris portfolio company–Impinj.

This post is not about Polaris’s investments in RFID, however. It’s about how the wider spread of various types of RFID technology, and the corresponding drop in cost of readers and tags enables new consumer applications beyond the typical supply chain scenarios. I’m just starting to track the evolution of this space.

Here is one great example–configuring your WiFi network and associated device. This is a major problem for consumers and one of the biggest revenue generators for IT services that target homeowners, such as BestBuy’s GeekSquad. To end the pain, comes news of an Apple patent that uses RFID tags for setting up wireless networks. You just bring your WiFi-enabled device close to the bay station and the configuration is done.

RFID tags also solve the problem of how to connect various “dumb” devices that don’t have appropriate user interface (like screen or keypad) for easy configuration:

• This may be the final piece in the puzzle to make Wi-Fi iPod a reality. Put WI-Fi chip inside, add RFID tag and that’s it. You take your iPod to your base station and then turn it on. Your iPod is another device on the network. Of course, passing Wi-Fi synchronization data to the iPod was already technically possible. But RFID tags make the process so much easier.
• One of applications mentioned in the patent is Apple Wi-Fi Remote for […] “controlling the operation of the iTunes music software” […]
• Extending your WI-Fi network. You can have RFID transceiver on Airport Extreme and RFID tags on Airport Express. Then you just sync them and plug Airport Express where you need extended Wi-Fi coverage.
• Wi-Fi enabled network printer and any other peripheral. Again, put Wi-Fi chip in it, slap RFID tag on, sync. Your printer is another device on the wireless network

The fundamental enabler of these types of auto-configuration scenarios is the unique identity of items with read/write RFID tags. Unique identity allows the association of unique state with a device, either within the device or on the network. The unique ID and state combined with a handshake protocol enable the synchronization of information between devices and allow for the beginning of meaningful interactions.

Apple is likely thinking about this problem as a closed system–Apple devices talking to Apple devices. It’s more interesting, however, to address the problem in a global manner. IMO, two standards are required.

First, a logical ID/state handshake protocol that can be mapped to various physical (wireless) transports and radios. We need this so that the master (configurator) device can send the slave (configured) device data about how it should configure itself. This may or may not be always necessary. Sometimes, it’s enough to just get the ID of the device and from that you can determine what type of device it is and how to talk to it but that requires the second protocol: a DNS-style hierarchical, federated protocol for getting access to the meta-data associated with devices with particular IDs. For example, it’s a way to tell a laptop that device X is a Brother MFC-8860DN networked multi-function printer/fax/scanner/copier.

There is a kink here. The default device configuration and the actual device configuration may be quite different. For example, consider the case of static vs. dynamic IP addresses on networked devices. Often devices come factory-configured with static IPs and then get switched to having dynamic IPs. Therefore, a local network should ideally run a service (just like local DNS servers) that can resolve the actual device configuration as opposed to the default (factory-provided) configuration.

Who’s going to run the master repository? Is there even a need for a master repository or can major manufacturers’ services federate the data? There are no easy answers here. EPCglobal, the industry association pushing RFID into trading networks, has given Verisign the national RFID directory rights. Here we are not talking about trading networks and item labels but consumer devices and the associated configuration information. I’m not sure that the EPCglobal requirements and Verisign’s directory are a good fit. Some lessons for building more advanced directories come from the SOA space and, in particular, UDDI, which in version 3.0 handled federation.

This space will evolve in interesting ways. If you are thinking about the consumer applications of RFID, give me a shout.