V. Freight Identification Technologies

Sections III and IV discussed certain freight identification technologies in reference to long term trends, freight identification strategies, and user contexts. Section V presents information in terms of the technologies themselves. Most attention is devoted to technologies with the fastest change, such as RFID and transponders, including mobile location reporting capabilities.

Freight identification technologies perform source data automation for individual transactions. They are often paired with data communication technologies, such as Electronic Data Interchange or Internet-based data exchange, to feed relational data bases and decision support tools.

A. Contact Methods of Freight Identification

Contact technologies are useful means of carrying automated source data from, for example, a shipper's computer to a consignee's receipt and inventory system. Contact media generally require manual intervention to remove them from a shipment to be read.

Floppy Diskettes and Memory Cards. These are classic examples of this kind of application, sort of 'freight-mounted' sneaker nets. They illustrate the point that contact technologies are best used as tools to pass detail data in special circumstances, not as a classic freight identification tool.

Optical Memory Cards. These are write once/read many media, akin to a CD-ROM in credit card form. DOD's Automated Manifest System (AMS) is a prominent example, using 4 megabyte-capacity cards. AMS is an effective tool given some of the limitations in DOD's logistics data systems, but it is not suited for intransit visibility since the AMS card can only be read if it is removed from the freight and taken to a reader-equipped computer.

Smart Cards. Combining data storage and processing power, smart cards are potent tools in the correct applications. Smart cards include PC cards, stand-alone battery-powered units, and usually simple passive or inductively powered cards. Most require direct contact or near contact to receive and transmit data. Although there are probably exceptions, freight identification is not the best use of these cards.

B. Non-Contact Methods of Freight Identification

Non-contact technologies range from very simple to very sophisticated.

1. Barcodes

The classic passive freight identification media is the printed linear barcode. Barcodes have been updated in data richness and data redundancy in so-called two-dimensional form, best represented by the PDF 417 standard. Linear barcodes serve as simple identifiers (hence are "license-plate-like"), while 2D tags can carry some detailed shipment data. These inexpensive technologies should continue in use for a long time to come. However, there are more dynamic non-contact methods.

2. Image Recognition

Image recognition is a high tech adaptation of an old technique. At its best, digital cameras record freight-related data, such as a painted container number, chassis number, or actual license plate. An excellent example is in place at Maher container terminal in New Jersey. Maher, working as its own systems integrator, adapted Northrop Grumman's Perceptics digital toll booth and parking lot license plate cameras, and uses them to collect data and manage its terminal operation. In addition to identification numbers, the cameras capture and the system stores visual images of drivers and of container and freight condition. Based on about ten months of experience, processing about 4000 container per day, Maher's system has had a reliability rate of about 93% for containers and 87% for chassis. As one indication of Maher's satisfaction, they are now turning the system into a product to sell to others.[20]

3. RFID

Radio frequency identification technologies cover a wide range of capabilities. There are short, intermediate, and long range systems, although only the first two are generally considered as RFID tools. (Long range capabilities will be discussed together with location determination systems.) Knowledgeable forecasters anticipate more than a six-fold increase in total RFID revenues from $188 million in 1996 to $1.2 billion in 2002, much of it from smaller, cheaper products.[21] The market may be constrained in some niches by safety concerns about electromagnetic energy from some designs that might imperil certain shipments of explosives.

Dedicated Short Range Communications. DSRC technologies are often used for vehicle-to-wayside applications, although simpler tags can be used to identify items of freight. Typical uses include Automatic Equipment Identification (AEI), the transmission of ITS/CVO regulatory and clearance information, and payment of tolls.

The Amtech-based standards for the U.S. railroads and the intermodal container operators cover DSRC applications. The tags cost about $25 apiece each in small volumes and as little as $20 each in large volumes. Recently Unova acquired Intermec, Amtech's Transportation Division, and some related IBM technologies. Using the IBM technology, Unova expects to be able to drop comparable tag costs to about $5, which could expand the market for such tags, perhaps extending it to individual pallets.[22]

DSRC tags support ITS/CVO applications—including state and Customs electronic clearances, safety data, and toll collection. There are roughly 350 CVO tag readers in place in the U.S. and 40,000 trucks carry transponder tags. While some tag systems are compatible and fewer are interoperable, the ITS/CVO and electronic toll communities are progressing towards a coherent set of DSRC standards. Those standards will accommodate both passive read-only and active read/write tags. However, the developing DSRC standards will not accommodate the existing ISO AEI tags for intermodal containers. Nor, without future modification, will the DSRC standards be consistent with the higher frequency standard under development in Europe and Japan.[23]

Small, inexpensive RFID tags could fill a number of freight-related functions. When prices drop much below a dollar, RFID tags should begin to displace barcodes in niche applications.[24]

Intermediate Range RFID. Intermediate range RFID may cover up to 300-foot ranges. The largest freight-related user of such tags today is the DOD, building on Army initiatives. Savi Technology manufactures the DOD tags and, as described above, they are read/write tags that hold up to 128 KB of data. The latest version of these tags cost $159 each and have omni-directional antennas, which makes them well suited for area coverage, as in marshalling areas or warehouses. They are used to carry complete shipment details on three kinds of shipments: surface container loads, airfreight pallets, and major items of unit equipment such as trucks and howitzers. The Army has put roughly 47,000 full capability tags in use, plus about 75,000 lesser capability tags, 1,500 fixed interrogators, and 500 handheld interrogators.[25]

Readiness and sustainability concerns drive DOD's use of data rich RFID tags, and the application would not be cost-effective for industry. However, it makes sense for industry leaders to follow DOD's experience closely: it is the most extensive high-end use of RFID and, as tag prices and performance improve, there may be important lessons for commercial innovators.

The Savi tags operate on 433 MHz, compatible with neither the AEI standards nor the developing DSRC and European/Japanese standards. However, DOD plays a leading role in the relevant ANSI standards committee, which has been working from a 2.45 GHz base. That committee is considering a multiple-frequency standard and hopes to complete work by the end of 1998.[26]

4. Long Range Communications and Location Determination

This is the area of most rapid development and change. The central attraction is the availability of inexpensive real-time location data from the Global Positioning System (GPS) satellites, although there are also non-satellite-based approaches to location determination. A new book reports counting over 400 positioning systems on the market for ITS and navigation: about 250 long range systems, such as GPS; about 120 inertial dead reckoning map-based systems that are totally self-contained in a vehicle; and about 30 short-range signpost-based systems.[27]

GPS is a one-way system, strictly a source of location data. As a result, mobile systems need another channel to communicate with dispatchers or control centers. Options include relatively expensive direct satellite communication links from geosynchronous satellites, with Inmarsat available worldwide and other service footprints in limited but commercially important parts of the earth. Several consortia are putting up Low Earth Orbit Satellites (LEOS) that promise less expensive communications. And many vendors are fielding or experimenting with still less expensive terrestrial communication including cellular, AM radio, and proprietary networks such as ARDIS.

The high-end application for these technologies is fleet management as provided by vendors such as Qualcomm and HighwayMaster for long-haul truckers. A Qualcomm installation was estimated to cost $3,500 per tractor in some volume. Qualcomm has installed 230,000 OmniTracs units worldwide and HighwayMaster has installed about 35,000 of its comparable units. A newly released market forecast by Ovum, an international telecommunications research firm, estimates the demand for tracking services in small trucks, transit vehicles, and long-haul trucks. Ovum believes 15% of the U.S. long haul truck market will be using tracking systems this year and that penetration will grow to 40% in 2005.[28]

By focusing on integrated (high-end) tracking systems, Ovum may be underestimating the market growth for freight-related mobile telecommunications. Significantly lower costs would open the door to new applications, such as tracking untethered (disconnected) trailers and containers. Acquisition and operating costs are falling for simpler location tracking applications and a wave of untethered tracking services are emerging from beta tests and approaching the market. A partial list includes Orbital's GemTrac system, Raytheon's Remote Asset Visibility, and Noram Telematics GlobalTrax Series 2000 Trailer Package. Market leader Qualcomm and HighwayMaster plan to release their entries in late 1998 or early 1999. Initial hardware prices range between $600 and $1000, plus monthly costs between $20 and $30. These prices seem high enough to limit market penetration, but they are only the starting points—prices will drop.

C. EDI and Internet Data Links

Many forms of freight identification technology use telecommunications as an integral part of their process—from DSRC through GPS. Those can be thought of as retail or tactical uses of telecommunications. Electronic Data Interchange and its telecommunication cousins such as Internet data transmission serve a different role, enabling separated parts of a network to share and coordinate transaction and backup detail data. Applying the same metaphors, EDI and its relatives are wholesale or strategic uses of telecommunication, and they are important complements to freight identification technologies. Two issues merit mention in this paper.

EDI vs. edi. There are many forms of electronic data interchange between computers, including unique and proprietary schemes. A subset of such generic "edi" is exchanges that use industry-established definitions and protocols—that follow Electronic Data Interchange standards. The potential power of EDI for streamlining transaction processing is in the widespread adoption of standards, not in a series of idiosyncratic interfaces.

EDI and the Internet. EDI traditionally has been passed through Value Added Networks (VANs), which charge for their services. One of the great attractions of the Internet is its inexpensive, if not free communication. Web-based data transmissions via the Internet are an attractive alternative, and new services advertise significant user savings over VAN alternatives. Some observers believe that the Internet will eclipse EDI, with much of the credit given to the higher costs of VAN-based EDI.[29] Even if VAN-based EDI shrinks, a critical feature of EDI is likely to persist over the Internet: the use of industry standard data definitions and formats—they will persist because they are the real advantage of EDI.

D. Decision Support Tools

Freight identification technologies gather source data and telecommunications technologies can move the source data around the world. However, tools to analyze and display information are necessary to transform high quality data into critical information for the design, adaptation, and control of exceptional logistics operations. While this paper is not the place to discuss those tools, it is worth noting that advances in computer processing power continue to expand the range and sophistication of analytic tools and display capabilities available to logistics practitioners. Warehouse location and truck route optimization equations that consumed hours of computer time a few years ago can now be run in minutes. Trucks equipped with HighwayMaster's on-board Rolling ETA can measure schedule adherence and contact dispatchers on their own. Modeling and simulation capabilities are more robust. Data visualization and display capabilities are much improved. All of these developments will continue and will become better integrated.

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