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11/23/2004
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Policy Gaps Impeding Government RFID Adoption

While government IT execs see RFID's potential, insufficient funding and lack of guidelines on privacy and security are delaying implementation.

The lack of guidance on policies concerning IT standards, security, and privacy is causing delays in the adoption and deployment of leading-edge IT, including radio-frequency identification technology, according to a survey of government IT executives. The survey, conducted by consulting firm BearingPoint, also found that insufficient funding for governmentwide adoption of IT and coordination between departments for IT projects are adding to the delays.

Government technology executives see IT innovation, including RFID, as key to achieving their goals. Asset visibility, business-process and productivity improvements, and homeland security are viewed as key applications for RFID technologies. But while most survey respondents say RFID would help improve organizational processes, few government agencies have deployed the technology because they lack guidance from the government leaders and the IT industry.

The 172 government IT executives participating in the online survey revealed that 31% of their annual IT budgets are directed toward IT innovation, including new initiatives such as RFID adoption, with the rest spent on purchasing commodity IT products and managing and maintaining existing systems. The survey was conducted between September and October to discover the drivers and barriers for government adoption of RFID and identify the applications that offer the greatest potential benefits and return on investment.

Survey findings indicate that 73% of respondents view IT innovation as key to achieving government agency goals. Not surprisingly, 48% report that RFID technology is important or very important to their work, with only 15% describing RFID as unimportant or very unimportant. But only 18% claimed a high level of understanding about RFID, whereas 32% claimed a low level.

Still, 57% are gathering information about RFID, compared with 25% that plan to start investigating the technology in 12 months and 18% expect to do so in two years. Twenty-three percent already have RFID pilot projects under way, with 36% planning pilot projects in 12 months and 41% in two years.

When survey participants were asked to rate the technology risks that are slowing or impeding RFID adoption, the top three were immature standards, incomplete government RFID policy, and the costs of tags and readers.

Securing data is a major concern among survey participants, with 54% of the IT executives saying that adequate levels of security is very important to the adoption of RFID in their organizations, compared with 30% indicating that it's important, 3% somewhat important, and 13% unimportant.

The findings give insight into why spending estimates for RFID projects in government are so low. Most respondents say their departments will spend less than $250,000 on RFID projects in fiscal 2005, and less than $1 million each year from 2006 through 2008. This is even though 56% of the respondents describe RFID as an emerging technology that could improve government processes.

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