ECR Europe Board EPCglobal Update EPCglobal - A GS1 Company Chris Adcock President EPCglobal Inc. 18 th March 2005

INSERT GRAPHIC SQUARE HERE 2 ©2005 EPCglobal Inc Agenda EPCglobal Purpose and Organization EPCglobal 2004 Review Standards and Technology Public Policy EPCglobal – 2005 Imperatives EPCglobal and ECR Europe Summary

INSERT GRAPHIC SQUARE HERE 3 ©2005 EPCglobal Inc EPCglobal Purpose  Take a global leadership role in developing and promoting multi-industry, user driven standards for collaborative commerce and supply chain management utilising EPC  User driven organisation delivering added value to our customers and stakeholders through our activities  Drive the global, multi-industry adoption of EPC

INSERT GRAPHIC SQUARE HERE 4 ©2005 EPCglobal Inc EPCglobal Inc. Organisation Chart Virtual organization > 1500 people

INSERT GRAPHIC SQUARE HERE 5 ©2005 EPCglobal Inc EPCglobal Board of Governors EPCglobal Board of Governors UCC Board of Governors EAN Management Board EAN.UCC End Users (4) Trans/Logistics (1) DHL Healthcare (2) J&J Novartis Public Sector (1) DoD Technology (2) HP Cisco Member Organizations (3) President, EPCglobal (1) MIT (1) Gillette (Board Chairman) Metro Procter & Gamble Wal*Mart Latin America Europe Far East

INSERT GRAPHIC SQUARE HERE 6 ©2005 EPCglobal Inc GS1 Member Organisations – the Local EPCglobal Representatives... in Germany in Brazilin Australia

INSERT GRAPHIC SQUARE HERE 7 ©2005 EPCglobal Inc GS1 Europe GS1 Europe represents European Member Organsations The objective of GS1 Europe is the harmonised implementation of GS1 standards and solutions across Europe.

INSERT GRAPHIC SQUARE HERE 8 ©2005 EPCglobal Inc Projects GS1 Europe 2005 oEuropean EPCglobal Project (EEP) oTraceability oEuropean Healthcare Initiative oPromotion (+ ECR Europe Conference) oLobby EU oGSMP co-ordination oRemove divergencies (EDI messages, Pallet label, Produce) oToolkit introduction Euro

INSERT GRAPHIC SQUARE HERE 9 ©2005 EPCglobal Inc EPCglobal – European Structure Europe EPCglobal European Coordinator

INSERT GRAPHIC SQUARE HERE 10 ©2005 EPCglobal Inc EPCglobal – European Structure EAP European Adoption Programme BAG Business Action Group Europe EPCglobal European Coordinator

INSERT GRAPHIC SQUARE HERE 11 ©2005 EPCglobal Inc EPCglobal – European Structure EEP European EPC Programme Europe EPCglobal European Coordinator

INSERT GRAPHIC SQUARE HERE 12 ©2005 EPCglobal Inc EPCglobal – European Structure EEP European EPC Programme Coordination GS1 UK EAP European Adoption Programme BAG Business Action Group Europe EPCglobal European Coordinator

INSERT GRAPHIC SQUARE HERE 13 ©2005 EPCglobal Inc EEP Objectives (GS1 Europe) Common product and service portfolio Harmonised pricing model User orientated – coordination with EAP Input to EPCglobal technical and application development Coordinated marketing campaign Joint development of information material

INSERT GRAPHIC SQUARE HERE 14 ©2005 EPCglobal Inc What is the EAP? Working group of the EPCglobal FMCG BAG –European focus to EPCglobal Co Chairs –Gerd Wolfram - Metro Group –Juup Willemse - Unilever Co Chairs Group –Retailers and manufacturers only –Ahold, Carrefour, Metro, Tesco, Nestle, Unilever, Kraft, P&G, Gillette 3 Full time support staff committed by GS1/EPCglobal EPCglobal European Regional Manager –Tony Taylor, seconded for 12 month from ASDA

INSERT GRAPHIC SQUARE HERE 15 ©2005 EPCglobal Inc EAP Objective To help European business to extract maximum business benefit from the use of EPCglobal technology as quickly as possible and with minimum problems and without duplicating the work of other EPCglobal or GS1 work groups

INSERT GRAPHIC SQUARE HERE 16 ©2005 EPCglobal Inc Europe and US – EAP view Some similarities –Consumer first: OOS improvement as ultimate measure –Global standard commitment (UHF Gen 2) Some differences –No one dominant retailer across Europe –No retailer mandates on RFID adoption –Careful approach, less hype (interoperability need) –Emphasis on environment (returnables item) –Emphasis on migrating from current EDI –Revised European Radio Regulations Agreed September 2004 EU Member States plus others (e xceptions Italy, Turkey, Sweden) 90% of the US read the range, lower data rate –Different national regulations and customs Mixed pallets, DSD, returnables

EPCglobal Membership

INSERT GRAPHIC SQUARE HERE 18 ©2005 EPCglobal Inc Global Membership Report December 2004 End Users Solution Providers TotalGlobal % EuropeAsia Austria033Australia101 Denmark112Japan71421 Belgium022China011 France4610Singapore224 Finland022Taiwan099 Germany111223India167 Ireland011Hong Kong017 Italy022New Zealand101 Netherlands224Sth Korea11112 Russia % Spain033 Sweden202 Middle East Africa Switzerland202Israel011 UK11920South Africa %0330.7% Latin America Brazil112 Nth America Colombia101Canada % US % End UsersSoln.Prov.Total Total: End Users Solution Providers TotalGlobal %

INSERT GRAPHIC SQUARE HERE 19 ©2005 EPCglobal Inc Membership Jun-Dec 2004

INSERT GRAPHIC SQUARE HERE 20 ©2005 EPCglobal Inc Membership – Jun ‘04 vs Mar ‘05 End UsersSoln.Prov.Total Total: March 2005

INSERT GRAPHIC SQUARE HERE 21 ©2005 EPCglobal Inc Membership – Jun ‘04 vs Mar ‘05 June 2004 March 2005 June 2004 March % Rapid growth and momentum continues 267% growth in membership European membership growth +127% since June ’04 Asia now has more members than Europe and is showing fastest growth 70% of growth during last 6 months from End Users End Users now represent over 42% of membership Rapid growth and momentum continues 267% growth in membership European membership growth +127% since June ’04 Asia now has more members than Europe and is showing fastest growth 70% of growth during last 6 months from End Users End Users now represent over 42% of membership

INSERT GRAPHIC SQUARE HERE 22 ©2005 EPCglobal Inc 82 Members in Europe and growing fast! Company becomes a member at head office location only Most companies operate with European and Global Supply Chains Aida Center

INSERT GRAPHIC SQUARE HERE 23 ©2005 EPCglobal Inc Agenda EPCglobal Purpose and Organization EPCglobal 2004 Review Standards and Technology Public Policy EPCglobal – 2005 Imperatives EPCglobal and ECR Europe Summary

INSERT GRAPHIC SQUARE HERE 24 ©2005 EPCglobal Inc EPCglobal 2004 Review Key achievements –Multiple launch meetings and industry momentum –User driven action group objectives established –Key “position papers” published –Rapid progress in developing global regulatory infrastructure –Greater control of public policy –Redefined relationship with Auto ID Labs –Certification partner identified –More balanced regional focus –Improved planning process – 2005 and beyond –And…….

INSERT GRAPHIC SQUARE HERE 25 ©2005 EPCglobal Inc EPCglobal 2004 review “Gen2…. A ratified standard!” …..From preparation to implementation

INSERT GRAPHIC SQUARE HERE 26 ©2005 EPCglobal Inc Agenda EPCglobal Purpose and Organization EPCglobal 2004 Review Standards and Technology Public Policy EPCglobal – 2005 Imperatives EPCglobal and ECR Europe Summary

INSERT GRAPHIC SQUARE HERE 27 ©2005 EPCglobal Inc Gen 2 Features

The Network

INSERT GRAPHIC SQUARE HERE 29 ©2005 EPCglobal Inc Network standards (Overseen by ARC) Search and Discovery Event Registries GEN 2 AIP ALE F&C Tag Data Standards Tag Data Translation Reader Management Reader Protocols Tag Data Translation Reader Management Reader Protocols Event Registry Application Program Interface (API) Application Program Interface (API) Security Specifications EPCIS protocols

Regulatory Infrastructure

INSERT GRAPHIC SQUARE HERE 31 ©2005 EPCglobal Inc Regulatory infrastructure Spectrum allocation to allow use of Gen2 UHF spectrum ( MHz) and power regulations (2w erp/4w eirp) Significant progress made: Europe – ETSI working group

INSERT GRAPHIC SQUARE HERE 32 ©2005 EPCglobal Inc Agenda EPCglobal Purpose and Organization EPCglobal 2004 Review Standards and Technology Public Policy EPCglobal – 2005 Imperatives EPCglobal and ECR Europe Summary

INSERT GRAPHIC SQUARE HERE 33 ©2005 EPCglobal Inc Privacy Guidelines Privacy –Guidelines update completed Q –“Responsible basis for the use of EPC tags on consumer items” Consumer notice Consumer choice Consumer education Record use, retention and security –Guidelines Q & A - published February 2005 – “Technical Solutions to Privacy” PPSC group established to focus on potential tech solutions to consumers’ concerns

INSERT GRAPHIC SQUARE HERE 34 ©2005 EPCglobal Inc Public Policy – 2005 Outlook Issues are broadening beyond privacy alone –Environment –Health and Safety –Employment –Anti trust Public Policy Steering Committees –USA– established and effective –Europe – established Q4 ‘04, issues identified, starting work –Asia – potential establishment during ‘05

INSERT GRAPHIC SQUARE HERE 35 ©2005 EPCglobal Inc European PPSC Co chairs –Paul NewmanGillette –Antonia VoersteMetro Expert group including: –Carrefour –Ahold –Tesco –Procter and Gamble –Metro –Gillette –ERRT –….. Members include (e.g.):

INSERT GRAPHIC SQUARE HERE 36 ©2005 EPCglobal Inc Article 29 Data Protection paper Key points in paper: –Must make a link to personal data before EU Privacy Directive applies –Digital traces as personal identification (PI) –Do not say more legislation is needed –Interest in making RFID activity visible to consumer –Recognizes EPCglobal EPCglobal response written by Europe Working Group (EWG) team –Led by Dirk Heyman, Gillette, with support from Deutsche Post, ERRT, P&G, Phillips, EPCglobal, St. Gallen and The Centre

INSERT GRAPHIC SQUARE HERE 37 ©2005 EPCglobal Inc Article 29 Data Protection paper Key points in response: –Current law adequate –EPC tag contains no personal identification information –Focus on capability today, not speculation –Positive aspects of real business applications –Ongoing effort of EPCglobal to address privacy concerns –Companies focused on positive relationship with customer –EPCglobal interest in participating more as a consultation partner going forward

INSERT GRAPHIC SQUARE HERE 38 ©2005 EPCglobal Inc Article 29 Data Protection paper Timeframe –PPSC review draft March –Draft finalized March 17, send to EU MO’s for review –Final due March 31

INSERT GRAPHIC SQUARE HERE 39 ©2005 EPCglobal Inc Public Policy Outlook:Privacy EUROPE Next steps for Article 29 Working Party not clear Potential Information Society DG green paper on RFID, may be less formal communication Critical for GS1 MO’s to be aware of issues and respond to national developments

INSERT GRAPHIC SQUARE HERE 40 ©2005 EPCglobal Inc Public Policy Outlook: Health and Safety Electro Magnetic Frequency (EMF) exposure concerns resurfacing due to increased use of wireless devices Questions in France, Switzerland Parliaments EU Commission asked Scientific Committee for EMF update Issue raised in EU Directorate General for Information Society WHO raised issue Recent media reports on mobile phones

INSERT GRAPHIC SQUARE HERE 41 ©2005 EPCglobal Inc Health and Safety: PPSC Action EWG forming subgroup to address EMF Review research to date, mobile phone industry experience Define issue for EPCglobal Prepare position statement (for media use if needed) Health and Safety

INSERT GRAPHIC SQUARE HERE 42 ©2005 EPCglobal Inc Public Policy Outlook: Environment Question on WEEE- EU Waste Directive for Electrical Appliances –EPC tag on packaging –Packaging Waste Directive applies –EPC embedded or attached to product, does WEEE apply? PPSC Action: Too early to request a formal position –Requesting meetings to distinguish passive from active tags

INSERT GRAPHIC SQUARE HERE 43 ©2005 EPCglobal Inc Quote of the Week “Protect exciting new technologies from premature regulation or legislation in search of a problem. RFID holds tremendous promise for our economy, including military logistics and commercial inventory efficiencies, and should not be saddled prematurely with regulation.” US Senate Republican High Tech Task Force 2005 Platform

INSERT GRAPHIC SQUARE HERE 44 ©2005 EPCglobal Inc Agenda EPCglobal Purpose and Organization EPCglobal 2004 Review Standards and Technology Public Policy EPCglobal – 2005 Imperatives EPCglobal and ECR Europe Summary

INSERT GRAPHIC SQUARE HERE 45 ©2005 EPCglobal Inc It all starts with the purpose…

INSERT GRAPHIC SQUARE HERE 46 ©2005 EPCglobal Inc Work Plan 2005 – 7 Imperatives 1) Standards and Technology “The Year of the Network” Facilitate technology adoption Enable EPC usage across target industries

INSERT GRAPHIC SQUARE HERE 47 ©2005 EPCglobal Inc Critical Initiatives Strategic Imperatives Measures & Goals Standards & Technology Develop global standards and facilitate technology adoption to enable EPC across target industries Agreed standards to support user requirements for 2005 Hardware Standards HF LCWD standard published Updated tag data standards published UHF Tag enhancements published Numbering systems agreed ISO ratification of Gen 2 Synchronized use of bar codes and EPC’s defined and published HLS Standards Development HLS Pedigree and and other use case requirements published Certification program operative Performance guidelines published UHF frequencies agreed globally EPC Network designed and implemented Security recommendation made Search / Discovery defined EPCIS global standard ratified AREA#INITIATIVEDATERESPSTATUS HARDWARE STANDARDS ST 1.1 High Frequency Tag Standard – Publish LCWD1-Sep-05HAG ST 1.2Updated Tag Data Standard 1-Jul-05TDS BAG ST 1.3Identify / deliver enhancements to UHF (class 1 gen 2) tag standards 1-Jul-05HAG ST 1.4Number system agreement and communication 27-Feb-05BAG – TDS ST 1.5Submit Class 1 Gen 2 standard to ISO 15-Jan-05EPCglobal ST 1.6Updates to Software Specifications from ratified Class 1 Gen 2 Standard (including Reader protocol, Reader management, ALE – Filtering and Collection, and ONS) 30-May-05 Read Prot, ALE SAGs ST 1.7Evaluate and subsequently recommend usage of (existing) bar codes and EPC tags together 1-Oct-05EPCglobal, UCC ST 1.8Tag Data Translation capability defined TDT SAG ST 1.9Item level tagging requirements defined 1-Jul-05 CPG / HLS Joint WG HLS STANDARDS DEVELOPMENT ST 2.1Pedigree Use case for HLS - requirements published 10-May-05 HLS BAG ST 2.2Item level tagging in hospitals - requirements published HLS BAG ST 2.3Medical device supply chain - requirements published HLS BAG ST 2.4Cold chain (i.e low temperature scenarios) - requirements and guidelines published HLS BAG ST 2.5Sterilization of tags in hospitals - requirements and guidelines published HLS BAG CERTIFICATION ST 3.1Deliver Hardware Conformance testing 30-Mar-05 EPCglobal /Met Labs ST 3.2Deliver Hardware Interoperability testing 25-May-05 EPCglobal /MetLabs ST 3.3Publish Hardware Performance Guidelines and accredit labs 31-Jul-05EPCglobal ST 3.4Deliver Software Conformance testing – Reader Protocol and ALE EPCIS 15-Jun Nov-05EPCglobal GLOBAL REG ALIGNMENT ST 4.1Monitor and lobby for harmonized UHF frequency usage globally 1-May-05EPCglobal NETWORK ST 5.1Finalize Network Framework and publish to community 28-Feb-05ARC ST 5.2Recommend solution for security within Network 15-Mar-05 Security SAG, ARC ST 5.3Recommendation of design of Search/Discovery capability 30-Jul-05ARC ST 5.4EPCIS global standard ratification 31-Aug-05EPCIS

INSERT GRAPHIC SQUARE HERE 48 ©2005 EPCglobal Inc Work Plan 2005 – 7 Imperatives 1) Standards and Technology “The Year of the Network” Facilitate technology adoption Enable EPC usage across target industries 2) Public Policy Address issues effectively across the world Provide input to regulatory bodies 3) Auto ID Labs Enhanced organization Alignment of activity with user needs 4) User Adoption Drive increased adoption of EPC standards Contribute to subscriber base growth

INSERT GRAPHIC SQUARE HERE 49 ©2005 EPCglobal Inc Work Plan 2005 – 7 Imperatives 5) Regional Balance Balance of focus and activity across the world Enhanced support for GS1 member organisations Industry development globally 6) Long term planning Clear processes, measures and control Development of 3 year plan - July Development of 2006 plan - September 7) Community harmonization Alignment within GS1, particularly GDSN and GSMP Review of subscription model Outreach to trade associations and other standards bodies

INSERT GRAPHIC SQUARE HERE 50 ©2005 EPCglobal Inc Agenda EPCglobal Purpose and Organization EPCglobal 2004 Review Standards and Technology Public Policy EPCglobal – 2005 Imperatives EPCglobal and ECR Europe Summary

INSERT GRAPHIC SQUARE HERE 51 ©2005 EPCglobal Inc EPCglobal and ECR Europe – much common ground EPCglobal initiatives link directly to “Enablers” and “Integrators” Supply chain effectiveness and meeting consumer’s needs – impact “Demand Management” “Supply Chain”

INSERT GRAPHIC SQUARE HERE 52 ©2005 EPCglobal Inc What can ECR Europe do to support EPC global 1.Ensure EPCglobal is a central theme of conferences / events –Relate it to ECR initiatives (National and European) 2.Link the benefits of Global Standards and EPCglobal initiatives within publications 3.Encourage ECR members to communicate business case benefits and ROIs to EPCglobal –Vision and transformation sceanrios are well known –Generic business case studies have limited value –Specific and identifiable success data will drive adoption –Increased adoption drives down costs

INSERT GRAPHIC SQUARE HERE 53 ©2005 EPCglobal Inc Agenda EPCglobal Purpose and Organization EPCglobal 2004 Review Standards and Technology Public Policy EPCglobal – 2005 Imperatives EPCglobal and ECR Europe Summary

INSERT GRAPHIC SQUARE HERE 54 ©2005 EPCglobal Inc Summary Momentum continues to build rapidly –regionally and across industries From preparation to implementation 2005 – “The year of the network” Extending global scope of activities Clearly focused, prioritized planning Need to develop more “public” facts about benefits. Gen2 a great success…..but a long way to go!

ECR Europe Board EPCglobal Update EPCglobal - A GS1 Company Chris Adcock President EPCglobal Inc. 18 th March 2005