Gillette-P&G Deal Could Speed Adoption of RFID

BOSTON -- Procter & Gamble Co.'s $57 billion deal to buy Gillette Co. and create the world's largest consumer products supplier teams two of the pioneers in a new technology that could supplement and eventually replace bar codes and, ultimately, make shopping easier.

The joining of the two companies could ease high costs and operational barriers that thus far have left the retail industry hesitant to embrace the adoption of radio-frequency identification tags, which promise to more easily and precisely track merchandise from factory to store.

The companies were founding co-sponsors in 1999 of the Massachusetts Institute of Technology's now-defunct Auto-ID Center, which laid the groundwork for standardizing product information used in RFID technology. Today, P&G and Gillette are leaders in a pilot project with Wal-Mart in Texas along with firms including Kraft Foods, Johnson & Johnson and Unilever.

The P&G-Gillette deal will enable the companies to pool their research programs aimed at reorganizing warehouse operations around RFID technology.