"The idea is that you would have tagged objects traveling through a facility, and readers that sense information from them," says Rainer Kerth, RFID lead architect at IBM. "Back-end systems make business decisions based on that data, and then feed information down into the network to smart devices that can execute those decisions -- a conveyor belt may be instructed to deviate a certain case or pallet, for instance."

IBM isn't alone in targeting this nascent market. According to ABI research, HP, IBM, Oracle, and SAP "see RFID as a critical first step to developing adaptive sensor-driven networks that provide real-time intelligence across the enterprise."

IBM's pervasive computing group is developing software that extends enterprise applications into RFID, sensor, and actuator environments. The sensor solutions will be built around IBM's software, research, and business consulting services groups, including edge network Websphere-embedded applications, premises-based Websphere Application Server (WAS) J2EE platforms, MQ Messaging solutions, and RFID software.

IBM will have a Websphere-based RFID middleware solution available sometime in the fourth quarter. German retailer Metro is already live with IBM's Websphere-based infrastructure for its RFID rollout.

Metro began receiving RFID-tagged pallets from 20 suppliers on Nov. 2. Early next year, the suppliers will tag transport packaging, allowing Metro to automate sorting and other processes. Suppliers involved in the current phase of the project include Colgate-Palmolive, Gillette, GlaxoSmithKline, Henkel, Kraft Foods, Nestle, Procter & Gamble, SCA Hygiene Products, Triumph International and Unilever Bestfoods, among others.

While RFID is getting the most attention right now, Kerth thinks the technology will drive investment into other forms of industrial automation, such as temperature, motion and pressure sensors.

"Right now the factory floor is isolated, and plays by different rules than the rest of the IT infrastructure," Kerth said. "Companies want to evolve themselves into more integrated operations."

The technology could also be used in other applications. Sensors in an airplane engine or a commercial air conditioning unit could alert service technicians to problems before equipment fails.

There are also opportunities to integrate RFID with other sensors. In Europe, for instance, RFID readers can't emit signals continuously, so users are looking at motion sensors to turn the readers off and on. RFID could also be integrated with temperature sensors for perishable food tracking.

IBM has set up three test centers in Tokyo, LaGaude, France, and Gaithersburg, Md., for its sensor and actuators division. Kerth says they are currently focused primarily on RFID, but will expand into other sensor technologies.

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