Last month, Alien Technologies reduced the price of its tag by 44 per cent to 12.9 US cents (7p) and Avery Dennison is offering the antenna inlays - the main part of the tag - at 7.9 cents (4p) each.

Erik Michielsen, RFID research director at ABI Research, told SM: "At low volumes these prices may not be profitable."

However, he said the aim was to...