Delivering the goods

Delivering the goods

On June 21, FedEx announced that its Kinko's Office and Print Services subsidiary had made a deal with T-Mobile for the wireless telecom provider's HotSpot broadband service. It gives customers wireless access to the Internet, allows them to send documents for production, connect with their corporate networks and check e-mail.

The next day, UPS began deploying a new generation of wireless technology, including Bluetooth scanners and Wi-Fi terminals, to package facilities and drivers in Europe and North America to improve data capture. When the global rollout of the $100 million project is completed by 2007, UPS will have 50,000 of these units, constituting the world's largest Wi-Fi network, according to spokesman Donna Barrett.

These initiatives and others, such as UPS's $120 million upgrade of its drivers' handheld computers to include global positioning and infrared capabilities, indicate the seriousness with which ex-press-delivery companies take developments in wireless and other technology.

Barrett said interest by UPS customers in wireless offerings is growing rapidly. Express firms are trying to make information available through multiple connections. They say this liberates users from their offices - it enables an engineer at a remote location to arrange a shipment of spares over his mobile phone or a salesman on the road to inform his customer about the status of a shipment.

Express firms have used wireless technology for more than a decade, but wireless links to customers are relatively new. "Over the years, it has migrated to allowing customers to use their wireless devices, for example, to track shipments from their cell phones," Barrett said.

It didn't take the integrators long to use wireless connections for EDI- or Web-based services ranging from cost and transit-time calculation to booking and pickup requests. Express companies are still finding new applications. Last November, TNT implemented a wireless LAN communication setup for airside operations at its European hub in Liege, Belgium. This allows personnel in the control tower to communicate with loading teams via handheld devices linked to printers, which has speeded loading and unloading.

Express companies, however, are still cautious about radio-frequency identification technology. Mark Thomas, FedEx's manager of scanning systems architecture, said high failure rates and vulnerability to interference remain problems. "It's not just the tags, it's the whole infrastructure. The hardware to read the tags is still in the developmental stage."

He said the main obstacle to RFID remains lack of a global standard. UPS's Barrett agreed. "For RFID to be ubiquitous, global standardization has to occur," she said. Costs are widely viewed as another major hurdle.

Barrett said businesses still must determine the implications of wider use of RFID, and what processes may have to be altered to accommodate it. "We're still figuring that out," she said.

Wal-Mart's aggressive push for RFID adoption suggests that benefits exist. Thomas sees significant improvements that go beyond the data captured on bar codes. He expects to see RFID tags used for value-added functions such as monitoring temperature and pressure - useful for sensitive cargo.

For now, the express carriers' use of RFID is confined to control of access to buildings and vehicles and tracking of larger assets. FedEx drivers have a wristband fitted with an RFID chip so they can unlock their delivery van and start the engine when they have their hands full of packages. UPS has been testing the use of RFID tags to track containers or larger objects, such as package vehicles in Atlanta and New York and containers in its Louisville, Ky., hub.

"When you look at closed-loop solutions, there it's quite easy to adopt RFID. There you don't have to interface with other people's standards," said Steve Quigley, senior systems architect at TNT Express. Cargo containers, however, have a habit of going beyond individual companies' loops.

"There you really want an industry standard, because you interline pallets and containers," FedEx's Thomas said.

Barrett said the lack of a universal RFID standard will hamper the technology's implementation for years. "I think it's going to be a while. You look at five to 10 years before we have a global standard," she said.

Uwe Doerken, chief executive of DHL Express and executive chairman of DHL USA, isn't so sure a global standard is necessary. He said the computer industry has thrived without a common standard, and that companies have used different EDI systems for years and managed to make them communicate by building interfaces.

"RFID is a bit like talking about computers 20 years ago," he said. "It is a great technology, and it will revolutionize the business, but it will come in different forms and flavors."