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Firms Want to Help Military Keep Track Of Its Gear

The U.S. military moves around a lot of stuff.

Bullets, dinners and spare parts go ’round the world by the container-full. Drive to the waterfront south of the San Diego-Coronado Bridge and take a look at the ships going together at the National Steel and Shipbuilding Co., and you can get a vague idea of the volume of stuff the military moves in its supply chain.

Hoping to keep better track of all the items in its supply chain, the military is adopting radio-frequency identification, or RFID, tag systems.

Recently, two local information technology companies, Wireless Facilities, Inc. of San Diego and RSI ID Technologies of Chula Vista, got in line to help the Department of Defense set up its RFID system. Specifically, they received blanket purchase agreements for RFID tag readers in early May.

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The deals authorize different agencies from the Department of Defense to purchase directly from the local vendors. Specific dollar amounts for the deals were not immediately available.

The local companies will compete with four others, but before I go into that, an explanation of RFID may be in order.

That explanation might be as close as your own medicine cabinet.

I’ve found RFID tags already on a few items I’ve taken home from the supermarket. At first glance, the ones I’ve found look like stickers with the old, reliable zebra-stripe bar codes printed on top. But these are unusually thick for paper labels. Examine one a little more closely and you might find the outline of a square, maybe an inch across, stamped out of very thin metal. It’s actually about a half-dozen squares, nesting one inside the other. That’s an antenna for communicating with a tag reader.

RFID tags are a lot like the zebra-stripe bar codes that a checker scans at the supermarket. Yet they don’t need line-of-sight access to a tag reader. Scanners can detect RFID tags by coming within a short distance of them. One of the scanners supplied by Wireless Facilities has a range of 25 feet (that’s the AR400 manufactured by Symbol Technologies Inc., of Holtsville, N.Y. In all, Wireless Facilities has the Pentagon’s blessing to sell RFID scanners made by three vendors and do systems integration work on them.).

Another advantage of using RFID tags is that each tag has an individual code and can help an owner identify products down to the individual unit. It’s as if every box of cereal on the store shelf had its own, unique serial number.

Information picked up by the RFID scanner goes into a server and into an organization’s large, enterprise computer system. From there it can inform enterprise resource management, supply chain management and customer resource management programs.

A Pentagon agency called ITEC4 , also known as the Army Contracting Agency Information Technology, E-Commerce and Commercial Contracting Center , awarded the blanket purchase agreements for tag readers. The four other companies that received them were CDO Technologies, Inc. of Dayton, Ohio; Cheval Rouge L.L.C. of Alexandria, Va.; Intecs International of Reston, Va.; and Sys-Tec Corp. of Petersburg, Mich.

Wireless Facilities also builds and operates cell phone networks and Wi-Fi hot spots, and it does work on corporate networks. The company trades on the Nasdaq as WFII. Its stock closed May 18 at $5.34. In 2004, net income was $5 million on revenue of $397 million. That was certainly a better year than 2002, when the company had a net loss of $63.9 million on revenue of $187 million.

RSI ID is much smaller. Its 2003 revenue was $7.3 million. The Chula Vista company is privately held.


Contact Brad Graves via e-mail at bradg@sdbj.com, or call him at (858) 277-6359, Ext. 3115.

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