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Don’t count out barcodes just yet

With barcodes continuing to find niche deployments, the technology’s days may not be quite as numbered as some people think.
/ Source: Financial Times

On the face of it, the days of the barcode would appear to be numbered. With the powerful new technology of radio frequency identification (RFID) tags around the corner, one might think that, rather like the fax, the barcode is an inferior technology that only maintains its hold because of its prevalence. But it would be wrong to write off the barcode just yet, as useful developments in the technology continue to be made.

For example, it is now much simpler to allocate unique codes to new items than in the past. Barcodes can easily be generated on the fly with asset information automatically passed across enterprise management systems. In addition, the ease with which barcodes can be scanned via wireless devices, at distances ranging from a few inches to 40ft, continues to bring new levels of goods monitoring automation to logistics.

On the consumer front, Nextel Communications, Motorola and Symbol Technologies recently announced the first barcode scanner attachment for mobile phones. “The Symbol PSM20i is less bulky than traditional barcode scanners, as well as being fully integrated into our Java and iDEN platforms,” explains Ernie Cormier, vice-president of business solutions at Nextel. At $250 per unit, the cost of the readers is likely to limit the system to certain mobile workers for now. But given the almost universal penetration of mobile phones, a fall in price over time could, for example, encourage the spread of self-checkout barcode-based systems in supermarkets and support retail marketing.

The use of barcodes is not only limited to business applications. The US Marine Corps relies on scanners and barcode labels to track materials en route to conflict zones and to help manage inventory once it is on the ground. These barcode labels, pre-printed on tough fabric, feature Symbol’s so-called two-dimensional barcode. Unlike standard barcodes, which depend on links to a larger database, 2D barcodes contain a kind of mini-database themselves, which includes information on the product and can be encrypted. Data on the barcode can even be read if part of the label is damaged or missing, a feature that can be important in tough operating environments.

Human error can often creep into logistics and one of the most common problems is the misreading of destination codes on packages. “For example,” says Mark Slater, managing director of delivery company Online Express Parcels, “the code for Bristol in the UK - BS - is easily confused with the code for Bradford - BD.” Other human errors routinely creep in when parcels are picked up. For example, some parcels in a large batch may get left behind or alternatively have the wrong labels attached to them.

Online Express Parcels is looking at ways of using barcodes to reduce the risk of human error. A relatively new organization, it took advantage of being paperless from the start. Customers enter delivery information on a website and an individual barcode is generated for each job, which the customer attaches to the parcel before collection. This information is also delivered straight to the driver of the delivery vehicle as a print-out including the unique barcode. Items can then be cross-checked using scanners as they are loaded and unloaded from a vehicle. This forms a real-time record of parcel location, allowing customers to track delivery.

At Britvic, the soft drinks manufacturer, the first phase of a project using barcodes has generated cost savings amounting to more than £100,000. The company has developed mobile technology with Conchango, a mobile business company, to automate the inventory process with more sophisticated scanning techniques. The first tranche of savings stem from allocating all of Britvic’s assets with a barcode: this means, for example, that a room full of vending equipment can be scanned by engineers in a fraction of the time that it took to enter data manually. This information is referenced against Britvic’s main database, allowing the company to track equipment movements and inventory far more accurately. In turn, the company can ensure that the correct equipment is assigned to each individual customer site - be it a pub, restaurant or newsagent.

But despite this activity, some commentators are starting to suggest that barcodes may soon become a thing of the past. They point to developments such as Wal-Mart putting pressure on its suppliers to adopt RFID tags. The argument has some force. Wal-Mart has enormous clout in the retail industry, and the weight it put behind barcodes back in 1984 accelerated their subsequent adoption.

But perhaps there is life in barcodes yet. For one thing, warehouse management systems are increasingly combining barcode and RFID technology - with barcodes on individual items and radio tags on pallets. The research group Gartner reports that most mid-sized and large distribution-intensive operations have adopted technology like this, although having done so, they are now in a process of assessing benefits before making further investments.

There is no shortage of innovative new applications for barcodes. At this year’s Edinburgh Festival, for example, Nokia and Orange set up a “mobi-ticket” solution, developed by Mobiqa. Customers who purchased tickets from a booking website would receive a barcode image sent as a picture message on their mobile phone. This barcode could then be read with a standard scanner upon entry to the event.

These “virtual barcodes” capitalize upon the prevalence of mobile phones and the popularity of messaging. Promoters are interested because the technology provides a good way to counter ticket touts. Vendors also like the idea because they can attach promotional material to the picture and costs are reduced because they do not need to print and post paper tickets. Mobiqa deploys similar technology in “mobi-coupons” - barcoded promotional vouchers that are delivered to the mobile phone - and “mobi-reward cards” - barcode versions of consumer loyalty cards that can, in effect, be carried by the phone. This is part of a growing trend, reports Butler Group, the analyst. Previously there has been a propensity for wireless operators to focus on technology, it notes. And at last we are seeing the deployment of useful and compelling mobile applications.

If barcodes can continue to find niche deployments such as this, the technology’s days may not be quite as numbered as some people think.