Radio-frequency identification or RFID tags essentially are bar codes that can be read from a distance, so instead of checking bar codes on items one by one, scanners can read all of the contents on shelves or in packages in a single pass.

Financial experts suggest the devices could help save companies and governments billions of dollars with nearly instant and more accurate data on where all of their goods are located at all times.

"RFID tags are poised to become the most far-reaching wireless technology since the cell phone," Cynthia Kuper, chief technology officer for Micromem Technologies in Toronto, told UPI's Nano World.

At the NanoBusiness Alliance meeting in New York City in May she cited projections by the Scottsdale, Ariz.-based market-research firm In-Stat showing worldwide revenues from RFID tags will jump from $300 million in 2004 to $2.8 billion in 2009.

A RFID tag essentially consists of a radio antenna hooked up to a microchip. The chip can hold all the information about a tagged item - when and where it was made, how to best store and handle it and so on.

Wal-Mart, the world's largest retailer, threw its weight behind RFID in 2003, requiring its top 100 suppliers to deploy the tags for tracking cases and pallets by 2005.

Last March the company reported the most significant mass adoption of the technology to date at roughly 8 billion tags. AMR Research in Boston, a market-analysis firm, suggested the cost savings for Wal-Mart could amount to $1.3 billion to $1.5 billion annually.

RFID tags already find use in cars and trucks for automated toll collection, and the U.S. military requires all of its shipments include RFID tags. Federal spending on RFID technology is expected to grow 120 percent by 2009, according to INPUT, of Reston, Va., another market-analysis firm.

The key to RFID's broad adoption, from cases to single items, is dropping its cost from the current 30 cents to 50 cents per tag.

"Nanotechnology could really help accomplish the goal of five-cent RFIDs for ubiquitous use," Steven Van Fleet, Micromem's senior RFID adviser, told Nano World.

For instance, most RFID tags currently use antennas etched from copper or aluminum.

"We're working with a few vendors that have inks with nano-sized particles in there that allow you to print antennas onto paper, which are much less expensive and faster to make," said Van Fleet, who also helps to lead R and V Group in Lagrangeville, N.Y., an RFID-label manufacturing company.

Another RFID company, Organic ID, in Colorado Springs, Colo., is looking at making printed antennas with gold or silver nanoparticles as well as with polymers.

Half of the cost of making an RFID tag lies in attaching the chip to the antenna, Organic ID Chief Executive Officer Klaus Dimmler explained.

"We have a machine that costs a million bucks that makes 30 million tags per year. Given the projected RFID market is in the trillions of tags, that doesn't scale very well," Van Fleet said.

Researchers are investigating ways to replace current flip-chip methods, which attach the antenna to the chip using paste that is then cured, with nano-scale solutions.

"What we're doing is experimenting with several crystal pin nanostructures put in the attachment glue that, with a little bit of pressure, make that connection without that curing time," Van Fleet said. "We're also using nickel balls and other geometric forms as well."

When it comes to improving the capacity of RFID microchips, Micromem is developing magnetic RAM, or MRAM.

"MRAM holds a huge opportunity with RFID. There's a lot of pressure from the Department of Defense and the Food and Drug Administration, who want more than just the initial 96 bits of information on a chip, to thousands and thousands of bits," Van Fleet said.

Unlike all other existing computer memories, which are based on storing electrical charge, MRAM stores information using nano-sized magnetic bits, each akin to a compass needle. A computer writes data into MRAM by flipping each bit's magnetic polarity, allowing data to be kept even when electrical power is removed.

Moreover, MRAM is resistant to radiation, unlike competing technologies such as flash memory.

"This makes it more usable for applications that deal with X-rays, such as with airline tags or military applications, or with the FDA, who requires tags that come with or inside a container or package for a pharmaceutical or a food product have to be irradiated," Van Fleet said.

The many companies researching MRAM are mostly going after higher-end applications in handheld devices.

"Micromem is a nano first by using MRAM to go after RFID," Kuper said. Reaching 256 bits for an RFID chip as opposed to a gigabit chip for a cell phone is relatively easy, Van Fleet said.

Micromem plans to pick a partner to develop its MRAM technology for RFID within the next few months to hopefully reach the market with MRAM RFID after this partnership in 18 to 24 months.

Future applications of nanotechnology could eliminate the need for silicon chips entirely with ink-based RFID circuits.

"The best example of this is Organic ID, who (has developed) a prototype completely in ink. If you look at their cost structure, it's less than a penny to produce," Van Fleet said. "I think MRAM is a short-end opportunity eclipsed in the not-too-distant future by these printed chips."

Van Fleet thinks such printed chips will take 5 to 10 years to reach the market, but Dimmler predicts his company could have RFID tags printed with nanoparticles or polymers sooner - demonstrating feasibility in 2006, pilot quantities by 2007 and commercial quantities in 2008.

RFID has drawn a lot of controversy because it could endanger privacy by allowing remote tracking of people and what they own, carry or have bought. Van Fleet noted second-generation RFID tags are taking such concerns into account.

"I personally feel you are giving up a lot of value by not bringing that technology to your house long-term, but there are people that feel it is an invasion of privacy, and the Gen 2 specifications give people the opportunity to request a tag get killed at the point of sale terminal in stores," Van Fleet said.

"You can overwrite the tag with all zeroes. There's also a provision to kill a tag electrically, the same way you kill electronic security tags on items in stores now."

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