Evan Schuman's StorefrontBacktalk

The German-based retail giant The Metro Group this summer started quietly experimenting with a radical change in supermarket layout and procedure: physically separating where groceries get scanned and where customers make their payments.
The move is designed to both cut costs and accelerate customers through the checkout process, said Gerd Wolfram, the groups' chief technical officer and the managing director of Metro Group Information Technology. Read more...

Two huge global retailers—Wal-Mart and the Germany-based Metro Group—pledged Tuesday to only support Gen2 systems from now on, in a move that one RFID analyst said was intended to do some damage control because of an RFID "pullback" from another global retailer, U.K.-based Tesco.

Wal-Mart opened the day by issuing a statement from CIO Rollin Ford promising that "all Wal-Mart installations moving forward would only read Gen 2 tags. As the remaining pallets and cases with Gen 1 tags make their way through the distribution network, Wal-Mart will convert all of its systems to only read Gen 2 tags." Read more...

Look for Symbol Technologies next week to introduce a mobile Gen2 RFID reader that is designed to be integrated into forklifts, pallet jacks and stretch wrappers. The unit—to be dubbed the RD5000—runs on Windows CE 5.0 and can use Bluetooth. At a cost of about $8,000, though, it’s a tad bit pricey. The vendor will also claim that it saves battery life because it uses sensors to detect the device’s proximity to tagged items, shutting down when motionless or out of tag range.

“Previous RFID deployment strategies have depended heavily on the predictable movement of goods, with RFID readers installed at ‘choke points’ such as dock doors,” said Anthony Bartolo, vice president and general manager of Symbol’s Wireless Infrastructure and RFID Divisions. “By RFID-enabling material handling equipment, organizations gain increased visibility to items in the supply chain all the way to the shelf or staging area.”…

Our panel this week whipped up some sweet insights into Starbucks’ headaches with an electronic coupon that they had intended to be strictly localized but the Web had other plans. It also jumped into the renewed interest from some major retailers into using closed-circuit video feeds for a lot more than catching thieves, including CRM and preventing child abductions.

Our panel this week featured IHL President Greg Buzek, the Retail Systems Alert Group‘s Steve Rowen, Forrester Research‘s Sucharita Mulpuru and The Lakewest Group‘s Sunita Gupta. StorefrontBacktalk Editor Evan Schuman moderated.…

MasterCard on Monday announced the first trial of its PayPass wristband, pledging to onload (excuse me, give away) the wristbands to the first 5,000 fans entering Giants Stadium for the New York Giants-Indianapolis Colts football game on Sunday. MasterCard’s people have painted the giveaway watches with the Giants’ team colors and pre-loaded them with $25, all ready to be used at the game’s concession stands.

The $25 figure was selected because it’s the magic number to avoid the customer having to give a signature and the merchant having to provide a receipt. The irony of pushing contactless for an extreme contact sport was not lost on the MasterCard folk. Maybe their next move will be to offer it to Bausch & Lomb? …

The Guangshen Railway Company, which is part of the world’s largest public transport operator, has purchased 125 million RFID tickets in a deal it’s describing as one of the largest RFID purchases ever.

Guangshen’s parent operation, the Ministry of Railways of China, transports more than 3 billion people a year. The railway said in a statement that it hopes the contactless cards will help it reduce ticket fraud and “break the current price barriers for paper tickets.” The contract was awarded to Finland-based RFID vendor Confidex. The company said that Guangshen operates the strategically located railway between Guangzhou and Shenzhen, one of the most modern railways in China. When it starts delivering the tickets next month, Guangshed Railway will be the first in China to switch from the traditional barcode tickets to a contactless-only fare collection.…

For your listening pleasure this week, you can hear us discuss video. (That’s probably more fun than watching us discuss audio.) Buy.com’s video reviews effort, to be precise. Will consumer-generated video content shake up E-Commerce? Also, the panel looks into why fewer than half of all retailers today even have a formal plan for dealing with consumer data security breaches as well as whether technology deployments today are often hurting retail sales.

Our late summer panel this week featured IHL President Greg Buzek, the Retail Systems Alert Group’s Steve Rowen and ABI Research’s Michael J. Liard. Special industry guest was Dave Samuel, co-president of Grouper Networks, which is now part of Sony Pictures Entertainment. StorefrontBacktalk Editor Evan Schuman moderated.…

Please click to listen in on this week’s audio discussion, as the panel rips into Google’s substantial new challenges, with both Google Checkout and marketshare, the question of whether the major E-Commerce sites are ready for the holiday rush or the holiday crash, and a European look at RFID pricing and ROI struggles.

Our inquisitive panel this week included returning panelists Paula Rosenblum from the Retail Systems Alert Group and former federal prosecutor and security expert Mark Rasch plus Safa Raschtchy, senior research analyst with Wall Street’s Piper Jaffray (who authored the initial report that questioned Google Checkout’s retailer acceptance) and Ben Rushlo, from Keynote Systems Evan Schuman, Editor at StorefrontBacktalk, moderated.…

In RFID these days, evidence is mounting that pricing consistency has yet to happen. In a report released Wednesday, European RFID analyst firm IDTechEx concluded that pricing logic has failed to visit many RFID facilities.

"Lately, some RFID tags have been sold at high profit and others literally given away. Yet more have been sold at a considerable loss by operations of doubtful viability and all this conspires to make it seem that there is no obvious price-volume sensitivity curve for RFID tags," the report said. Read more...

This week’s audiocast looked at a key payment system issue: the feds cracking down on giftcards. We also explored some of the hotter topics this week in RFID, including the enviable positioning of Impinj. In Online, we explored the implications of Amazon’s patent to suggest gifts based on—among other things—religion and sexual orientation.

This week’s panel featured return visits from IDC‘s Pete Abell, former federal prosecutor Mark Rasch and the Retail Systems Alert Group‘s Paula Rosenblum. The newcomer to StorefrontBacktalk’s Week In Review this week was Bruce Cundiff, a former payments analyst for Jupiter Research and today a senior analyst with Javelin Strategy. …

The Spychips people—some privacy advocates who are not fond of RFID efforts—have unearthed another several-year-old RFID demo video, this one apparently designed for the U.S. Transportation Security Administration (TSA). These videos are amusing for two reasons. First, they show how quickly technology evolves and how state-of-the-art from just a few years ago can look positively ho-hum today. And secondly, it shows how far the political climate—in terms of how much security controls Americans will tolerate—has changed.

My favorite part of this video, however, are the many Cold War era Soviet-sounding typos, just to add to the Natasha-Boris theme of the demo itself. “Now we know where he want to fly,” “The ID number is now readed,” “passagers profil” and “would you like to print you boarding pass?”…

Symbol Technologies on Tuesday cut a marketing partnership with Vue Technology with the stated goal of advancing their item-level RFID sales efforts. Some industry analysts greeted the news that the pair, which have been working with BestBuy on item-level efforts, will be working together on various projects as good news.

IDTechEx’s Peter Harrop said that although the agreement may indeed be little more than a marketing news release, “they will be working on state-of-the-art efforts and the industry badly needs this to be done” by somebody. IDC’s Pete Abell offered a similar take, that it’s a good move because it reduces one area of potential fingerpointing and provides the always-popular “one-throat-to-choke for the infrastructure” for item-level RFID.…

Although RFID hurdles are certainly plentiful in the U.S. these days, China is running into an entirely different set of deployment roadblocks. Given the strategic importance of the growing Chinese market, this is an area that needs to be watched closely. ABI Research issued a report Tuesday that silence from the national government and aggressive marketing by EPCGlobal are combining to create a climate of uncertainty around the issue of RFID standards in China.

ABI Research analyst Junmei He pointed to the three most daunting issues: “Chinese manufacturers’ partners in the supply chain will require them to use RFID tags complying with international standard, EPCglobal UHF G2. At the same time, foreign clients of Chinese manufacturers, who are planning to adopt RFID, will request that shipments carry tags complying with the EPC UHF G2 standard. EPCglobal’s aggressive move in the heartland of Chinese manufacturing is now turning the EPCglobal UHF G2 standard into a de facto standard on the mainland.”

“The reality is that for the Chinese government, it is no long important when the national standard will be released. It is late already,” He said.…

The field of RFID blocking devices is growing almost as rapidly as RFID deployments. A far cry from the homemade crudely-designed aluminum-foiled-lined wallets that were cropping up just nine months ago, companies now want to block unwanted radio frequencies with some style. In Japan, an outfit is selling RFID-blockers adorned with Hello Kitty designs. This would never work in the U.S., as our cats are more independent (read anti-human). “Why should I block this signal? It’s not my credit card. What’s in it for me?”…

When Impinj on Monday rolled out two new RFID chips—the Monza/ID chips with factory-programmed product identification numbers and Monaco/64, the first in a line of chips with user-programmable memory—the industry took notice.

The Seattle Times talked about how long Impinj has been sitting on top of the supply-chain RFID world and RFIDUpdate puts Impinj near the top of a list of likely RFID pureplay IPOs, now that Alien Technology has given up its IPO efforts. Inpinj has one thing going for it: it’s already reported a profitable quarter. For an RFID firm these days, that’s nothing to sneeze in your spreadsheet about.…

This week’s audiocast looked at issues ranging from payment systems—practical problems with retail PCI deployment as well as a new POS/Loyalty card program from Subway–to a new search feature unveiled on Thursday by Amazon.com and a look at the RFID industry after Alien Technology’s failed IPO. This week’s panelists featured return visits from IDC’s Pete Abell, Solutionary senior VP and former federal prosecutor Mark Rasch and Jupiter Research’s Patti Freeman Evans. Newcomers to StorefrontBacktalk’s Week In Review this week were Cathy Hotka, senior VP for the Retail Industry Leaders Association and Jupiter‘s Edward Kountz. StorefrontBacktalk Editor Evan Schuman moderated.

The PCI discussion was a fascinating realworld look at how PCI is great on paper but much more challenging in live retail environments. No panelist kept out of that free-for-all. You really should listen to it, if for no other reason than to get better excuses for PCI hiccups.…

In a dressing room in the huge Japanese department chain Mitsukoshi, half-dressed customers scan RFID-tagged jeans and then use an IP telephone to check inventory and call for more clothes to be brought in. Workers at the $8.5 billion retail Tokyo-based chain traditionally waited outside dressing rooms, listening for instructions to bring more clothes. In the new experimental system, the workers can stock shelves while waiting for their Voice-over-IP phone to ring and for the customer to ask for something.

But those requests will most likely be quite specific. With most of Mitsukoshi's clothing already RFID-tagged, customers can scan the clothing in to quickly check inventory displayed on the RFID-reader-equipped Cisco phone's 3.38 x 4.5 in. touchscreen display. Read more...

In what one executive of the $9 billion 26,000-restaurant Subway chain dubbed "the single largest integrated cash card program in the world," the new card handles payment, instant loyalty rewards and highly-targeted promotions that can be tracked by customer.

The program takes a very basic mag-striped giftcard and, through a unique 16-digit identification number, takes the card through Point Of Sale (POS) through to CRM. "It's a very sophisticated CRM program," said Marina O'Rourke, Subway's director of retail technology. "It has the ability to target consumer behavior and reward and entice that behavior. It can look at cardholders in a geographic area. We can drill down to the store level. We want to understand if we can change behavior by offering, let's say, a free cookie." Read more...

American Eagle Outfitters is learning a PR lesson, even though it appears they never did anything wrong. Apparently, about four years ago, the retailer was given an RFID presentation by a systems integrator called CompEx Inc. Included in the demo was an animated presentation on how effectively and secretly RFID could gather consumer data.

That presentation found its way to the privacy web site of Katherine Albrecht, a noted RFID opponent and author. To read the full story,
please click here.…

A new mobile payment system–called PayCash Mobile, from Cyphermint–will make its appearance at Regal Cinema and Barnes and Noble.com soon, according to Cyphermint CEO Joe Barboza. The new system will charge retailers about 2 percent of a transaction and will use a cellphone number and a PIN to authenticate transactions that are then paid for with a traditional credit card.

The benefit of this system compared with others from rivals such as MobilLime, Barboza said, is that it processes payments in a matter of seconds compared with hours for MobileLime.…

Eight days after it said it was preparing for an IPO on a day-to-day basis, Alien Technology--which had been granted the RFID trading symbol--has given up the attempt, according to a statement the company issued on Friday.

"Alien Technology Corporation today announced that the company has withdrawn its Registration Statement on Form S-1 with the Securities and Exchange Commission and has determined not to proceed with the registration and sale of its common stock at this time" the statement said. Read more...

This week’s audiocast panel discussion of the StorefrontBacktalk retail technology week that was …. was decidedly global in topics. This week’s group of retail technology analysts that sat down late Thursday was Patti Freeman Evans from Jupiter Research, Sucharita Mulpuru from Forrester Research and Paula Rosenblum from the Retail Systems Alert Group. StorefrontBacktalk’s Editor Evan Schuman moderated.

The group opened with a hard look at the German Metro Group’s Item-Level RFID plans and whether Wal-Mart can survive as a retailer outside (and, as one panelist argued, inside) the U.S.

The group also discussed retail attempts at mobile marketing, focusing on the Subway chain’s experimentations with cellphones, which raised issues of how far ahead of the U.S. much of Asia and Europe are and how that should impact retailer’s global IT strategy.

The panel also jumped into a report expected next week from Jupiter Research that looked at how e-tailers—including Netflix–are making some surprising decisions about incorporating user-generated product reviews.…

China is prepping its own RFID standard for next year, with a stated goal of being cheaper than EPCGlobal’s approach. The Electronic Engineering Times story reports that the air interface will use the ISO frequency of 13.56MHz for near-field communications applications, and China will probably clean up some part of the 860MHz to 960MHz band for logistics applications.

China is still pursuing its own numbering system, called the National Product Code, which will compete against EPCglobal’s Electronic Product Code (EPC), the newspaper story said.…

Phones that can ring with coupons, beam payments and deliver true multimedia interactive experiences are already in the pockets of most consumers. How far will—and should--retailers go?

A free product coupon is a free product coupon, right? If it's for the same product at the same merchant and the pricing and timing are roughly the same, it shouldn't matter how that coupon is given to the merchant. Andrew Kamps, the VP of operations at a New York restaurant chain, recently learned otherwise.Read more...

With a year of charges under its moneybelt, JP Morgan Chase on Monday released first-year statistics for its contactless Blink cards, trying to bolster the argument that the cards deliver better than traditional magstripe cards and cash.

The stats gathered from the seven million contactless Chase cards issued do indeed show strong improvements over older options, but there is some question about how much of those improved numbers are because consumers liked the contactless cards better than the alternatives or because of the cards' novelty. If those statistics hold or improve in the next year or two, as the contactless payment's gee-whiz factor fades, that may be much more meaningful. Read more...