Texas Instruments this week announced that it has begun shipping radio-frequency-identification (RFID) chips--inlays and straps--based on Generation 2 (Gen 2) protocol, marking the company’s entrance into the retailer-centric RFID market.

Texas Instruments has developed RFID technologies for more than 15 years, but the company was not among those that developed proprietary Gen 1 products used by suppliers to satisfy mandates from large customers such as Wal-Mart and the Department of Defense, said Enu Waktola, EPC retail supply-chain marketing manager for Texas Instruments’ RFID systems.

“[Texas Instruments] did not participate in the Gen 1 market,” Waktola said. “We were looking for a global standard.”

Indeed, one of the promises of the recently approved Gen 2 standard is that any Gen 2-compliant tag can be read by any Gen 2-compliant reader--a characteristic Texas Instruments proved in a test with Philips announced last week.

In this environment, the benefits of RFID can be “transformational,” ultimately resulting hundreds of millions tags being placed on goods worldwide to provide supply-chain visibility, Waktola said.

“Companies are just starting to understand the quantifiable [return on investment] that can be achieved with RFID,” she said. “We hope to help companies get past the piloting mode to implementation.”

Waktola said Texas Instruments is prepared to manufacture large volumes of chips during the second half of this year, based on customer demand. Some suppliers have balked at the price of RFID tags, but Waktola noted that “tag pricing is going to be based on economies of scale.”