SAMSys Technologies acquires Hamel Davidson, expands HR and marketing

SAMSys Technologies Inc has finalized a pivotal technology licensing and OEM agreement with UK-based BiStar Technology Ltd that it says proves the viability of its multi-protocol radio frequency identification (RFID) technology strategy. The announcement could provide impatient investors with much-welcome news on commercial deployment of the promising technology, and executives hope the agreement will help SAMSys maintain a fragile lead in the nascent industry. Under terms of the BiStar deal, SAMSys will incorporate BiStar’s over-the-air UHF tag protocols into its RFID readers which will then be manufactured on an OEM basis for BiStar. The agreement also outlines plans for collaborative technology development and joint ownership of intellectual property created out of the partnership. Horwitz says this is a clear sign that the RFID industry is beginning to mature and the movement towards interoperability between various RFID standards, systems and technologies is starting to take hold. "This is not only sensible, but it also achieves the best opportunity to leverage the resources and expertise to the fullest extent," he says. As it stands, the industry is a hodge-podge of competing, non-interoperable proprietary standards and protocols – a situation that has been blamed for the lack of growth to date in the sector. The company has been on an aggressive acquisition streak of late with the purchase of long-time partner Hamel Davidson Corp and Hamel Davidson International Corp (HDIC), Durham NC. SAMSys also recently secured a $1-million private placement that should help the company commercialize its product. "We have indeed forged a very important relationship with a very large company (BiStar) and have been selected as their official reader manufacturer," says SAMSys CEO Cliff Horwitz. "This has enormous implications and is fundamentally the reason behind the Hamel Davidson acquisition." With the acquisition of Hamel Davidson and its U.S. subsidiary, the company has assured itself of adequate staffing requirements needed to bring its RFID readers from the development table to the commercial stage. In an interview with Report on Wireless, Horwitz says that the acquisition of Hamel Davidson and its U.S. subsidiary HDIC provides the company with much needed management expertise. "Clearly, if our aspirations are to grow to the size and the scope that we see as being possible, we need to broaden the base of management," he told RoW. "So I think that it’s now time to take the step whereby we can rationalize what we have and what (Bill Davidson) has in terms of resources and optimize them." Horwitz says the RFID industry is starting to show some early signs of maturity and that requires an acceleration of the commercialization of the company’s reader technology. "We believe that given the limited time we have in order to really establish our dominant leadership, we need Bill Davidson and his team focused 100 per cent on what it is that SAMSys is all about," he explains. The company’s reader technology addresses a key issue affecting the auto ID industry. Its multi-protocol, multi-frequency strategy eliminates the sometimes-difficult choice companies face in choosing an RFID system. By positioning the reader as a "universal reader" that operates in multiple frequencies and protocols, companies only need to implement a single technology that spans various supply chain systems, explains Horwitz. The premature obsolescence of technology, which is one of the primary reasons RFID has been slow to catch on, is essentially eliminated with multi-platform technology. At Frontline Solutions in Chicago, the primary trade show for the North American auto ID industry, there were clear indications that the RFID industry is beginning to shed its "futuristic" image and provide real solutions to the supply chain industry. There is clear positioning taking place in regards to tag converters, reader manufacturers and systems integrators. According to a recently released Frost & Sullivan report, the RFID market sector is expected to rise to US$10 billion by 2004. Horwitz says it’s now clear that one company cannot be a single supplier of all the elements of a functional RFID system and that it will take an effort from all three types of companies to make RFID a reality. More companies are becoming receptive to trials and pilot projects to test and evaluate systems "in order to get the wheels in motion," he adds. Company won’t go head-to-head with bar code SAMSys is primarily involved in everything that falls under the materials handling banner, which is different from toll road applications and large container tracking. Key to the company’s strategy is to not compete directly against other technologies or markets that have significant infrastructure. "We’re not going to convince anybody to go ahead and scrap $50 million or $100 million investment in existing infrastructure in order to install the next best mouse trap," says Horwitz. Attacking green field applications is fundamental to the success of the company, he adds. The success of RFID will also depend on targeting areas where it represents the only possible and viable solution. "We’re not looking to displace or replace bar code," he told RoW. "I think we’ll lose the fight every time. We need to market RFID where its inherent functionality is what sells it." The retail environment represents some interesting opportunities as well, by enabling retailers to track goods more effectively. SAMSys is looking to "expand the continuum of the tracking process, not just through the dock door to the warehouse, but from the warehouse right onto the shelf," says Horwitz. It is still unclear what kind of competition SAMSys will have when its products hit the market. Due to the relative infancy of the RFID industry, Horwitz doesn’t yet see any major competition in the industry. There are other reader manufacturers in the world that have capable technology, but he says none are developing a multi-protocol, multi-frequency product, which is the primary attraction of their product.

SAMSys Technologies acquires Hamel Davidson, expands HR and marketing

News | 11/27/2000 5:00 am EST

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