Next generation Barcode-2D
and its business implications
It has been 50 years since 1D (one
dimensional) barcode was introduced into
the industry, primarily for encoding product
details. However, over the years, there has
been a growing demand for encoding more
data into a small space, which 1D fails to
deliver. Now the evolution of Next
Generation barcode—2D (two dimensional)
—opens
up
various
application
opportunities. This white paper briefly
describes 2D, its various types, its usage
(product tagging, ticketing, coupons, smart
poster) and the business challenges in
taking it forward.
Next generation barcode-2D and its business implications
About the Authors
Jyotirmayee Mohanty
Jyotirmayee has five years of experience in the IT industry and has worked in
various application development projects in Life Sciences and Healthcare,
Transportation and Retail domains. Currently, Jyotirmayee has been involved with
the RFID and Sensor group, focusing on 2D initiatives. She can be reached at
Jyotirmayee.m@tcs.com.
Debi Prasad Pati
Debi has twelve years of experience in the IT industry and has been involved
mainly with various technology (Smartcard, RFID & sensor, mobile computing)
initiatives in the areas of Life Science and Healthcare, Transportation, Retail,
Manufacturing, and Finance. He is currently part of TCS’s Niche Technology
Delivery Group (NTDG), and is working on multiple strategic solution-led initiatives
across industry units in TCS. He can be reached at debi.pati@tcs.com.
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Next generation barcode-2D and its business implications
Contents
INTRODUCTION ............................................................................................................................... 4
WHAT ARE “2D BARCODES”?.......................................................................................................... 4
TYPES OF 2D BARCODES .................................................................................................................. 4
APPLICATION AREAS OF 2D BARCODES ........................................................................................... 5
ISSUES AND CHALLENGES ................................................................................................................ 7
SOLUTION ....................................................................................................................................... 7
CONCLUSION ................................................................................................................................... 8
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Next generation barcode-2D and its business implications
Introduction
Retail businesses are looking for innovative ways to enter into relationships with customers by providing
additional information about the product and sales. This has led to encoding more data in the existing carrier
technologies, like 1D, for extended packaging data, content purchase and delivery, coupons, etc. As barcodes are
popular and their convenience is universally recognized, the market began to call for codes capable of storing
more information and more character types, and that could be printed in a smaller space. As a result, various
efforts were made to increase the amount of information stored by barcodes. These efforts included increasing
the number of barcode digits or laying out multiple barcodes. However, these improvements also caused
problems such as enlarging the barcode area, complicating reading operations, and increasing printing cost. 2D
barcodes emerged in response to these needs and problems in the mid-1980s.
What are “2D Barcodes”?
2D barcodes are a way to encode substantial amount of information and are improvements over linear barcodes.
2D barcode contains information in both the vertical and horizontal directions, whereas a 1D barcode contains
data in one direction only.
2D barcodes are durable, more versatile and cannot be corrupted easily. If 30 percent of the data areas become
dirty or damaged, the data can be restored and identified.
Types of 2D Barcodes
There are two types of 2D barcodes:
2D stack-type code
Traditional barcodes are stacked one after another. These are made up a series of one dimensional barcodes.
The data is encoded in a series of bars and spaces of varying width.
2D matrix code
This code’s data is based on the position of black spots within a matrix. QR and Datamatrix are the most
commonly used 2D barcode symbologies.
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Next generation barcode-2D and its business implications
Application Areas of 2D Barcodes
2D barcode can be used by applications in various types of industries like logistics, retail, healthcare and
manufacturing.
The areas where 2D barcode can be used are discussed here:
1. Product tagging and extended packaging
2. Mobile ticketing
3. Mobile coupons
4. Smart posters
Product Tagging and Extended Packaging
In stores products are tagged with 2D barcodes encoding additional information. A customer can scan the 2D
barcode on a product to know when and where the product originated, or the customer can read a 2D barcode
and connect to a specified URL, which displays information such as a page for a specific product with its
specifications.
Mobile Ticketing
Mobile tickets help customers book tickets from any location at any time using their mobile phones. Nowadays
airports are replacing costly magnetic striped boarding passes and related equipment by a single 2D barcoded
boarding pass. After the customer purchases the ticket over the Internet, Airline reservation server sends on-fly a
mobile ticket as an SMS or MMS with a 2D barcode in it. All the flight information is stored at a secure on-line
location, and this barcode is the link to it. Anyone at the airport, who scans the code will immediately be able to
see the ticket information. Therefore, the customer can use it to get through security and board the plane. It cuts
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Next generation barcode-2D and its business implications
down on both queuing time and printing costs. Compared to paper based ticketing Mobile ticketing reduces the
production and distribution costs, consumption of time and the manpower required.
Mobile Coupons
Mobile coupons are electronic coupons which can be in the form of a 2D barcode. It generally contains
information like offers available for a product, discount on the price of the product, etc. It can be delivered to the
consumer’s mobile device. Consumers present the mobile coupon, which generally contains the 2D barcode) at
the POS terminal to get a discount. They can also forward the coupons as a gift to their friends.
Benefits of using mobile coupons:
1. The consumer does not need to remember to bring the coupon to the shop as the coupon will be in the
mobile as a SMS/MMS in the form of 2D barcodes.
2. The process is convenient and safe. The coupons are received in the mobile as a SMS/MMS in the form of
2D barcodes and consumers need to show the mobile phones to redeem.
3. Delivering the coupon information directly to the mobile device of the consumer is easy and reduces the
distribution cost as the use of paper based coupon is avoided.
4. The checkout process at the retailer becomes faster.
These opportunities create interest among the retailers and consumers in using mobile coupons.
Smart Posters
Smart posters keep data in the form of 2D barcodes and allow consumers passing by advertisement displays to
access advertising and promotional information about the product and locating and navigating to the stores.
These also help to make some reservations and subscribe to some services.
Case Studies
1. In France, inside restaurants and stores 2D barcodes are placed containing information like local landmarks,
restaurant reviews and maps. Users can scan the 2D barcode to get these detail information. The process makes
the city more navigable.
2. Magazines and advertisements in paper contain 2D barcode with links to sites with detail information about
advertisement of the product. This has been used extensively in Japan.
3. Nowadays, 2D barcodes are used throughout stores to provide more information like specification of the
product, the contents of the product etc.The customers can scan the 2D barcode at the store itself and can take
the buying decision there itself.
5. Customer data,Shipping data,product quantity and other information can be encoded in form of 2D barcode
in the shipping slips and receipts of automated industries.By this prosess large volume of information
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Next generation barcode-2D and its business implications
can be collected in a single scan operation.
6. The product code,manufacturing history,expired date of food products can be encoded in the form of 2D
barcode. This process gives better logistic management and improves tracebility of food products.
7. In sales industries, product information like product code, product name etc, can be encoded in 2D barcode.
This data is used for sales management purposes and gives a better analysis of sales situation.
8. In retail industries,matching the products received with shipping documents and purchase orders is a time
consuming process and prone to manual error. So , now a day, the vendors put 2D barcode on the pallet and
containers containing information like purchase order number,the vendor
number,the item number and
quantity of the items etc. At the receiving end, the 2D abrcode on the containers can be scanned and compared
against a purchase order. This prosess is faster and eliminates manual error.
Issues and Challenges
Around the world today, there are more than 200 different 2D barcode formats being used, and a few of them,
like QR Code, Data-matrix and Aztec have more widespread use than others. Similarly there is a fragmentation in
the worldwide market. Though industries understand the potential of 2D barcodes, its adoption and penetration
is very slow as compared to 1D today. This is primarily because of the following issues and challenges:
Standards
Various formatting standards (many of them are proprietary) are used, such that extracting information is
becoming a daunting task. It is advisable to limit the number of 2D barcode formats to 4 or 5 so that 2D barcode
ecosystem will permit the 2D barcode adoption faster.
Universal Scanning
The scanners are not able to scan all formats; hence their usage is becoming limited. It is necessary that the
scanners should be capable of scanning different formats with limited number of formats getting standardized
across industries.
2D Barcode Service Provision and Delivery
The industries have seen that major 2D barcode usages are going to be carried out by mobiles. This has led to 2D
barcode in the form of mobile code, requiring consistent service provision across makes and models of handsets,
across operators, and across redirection platforms. There are similar other challenges, like who should publish
those codes, what should be trusted channel to deliver the codes to end user and how the content provider is
linked.
Solution
Now initiatives are being taken to address these issues and challenges across industries by standard governing
bodies. These initiatives are:
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Next generation barcode-2D and its business implications
The Open Mobile Alliance (OMA) has taken initiatives to provide guidelines on existing standards and create
specifications to address interoperability needs that have been discussed above. So in future, all the mobile code
(2D barcodes) readers, which follow these guidelines, will be deployed on the consumers’ handsets to extract
information through embedded camera.
The CTIA Code Scan Action Team (CCSAT) group is working on the existing problem (multiple 2D barcode formats)
to bring the use of common code symbologies and an ecosystem architecture that enables both standardization
and open competition across industries.
It is very important to standardize the business model, code life cycle model, communication model among
various stakeholders (advertisers, campaigners, etc.) to take it to the next steps.
The GS1 System, the world’s most accepted standards system that provides globally unique identification
numbers and barcode marking for trade items, has recommended the use of GS1 DataMatrix, a 2D barcode in
healthcare industries to use on trade items that have limited space for product marking to pass through retail
point-of-sale (POS) and need to be tracked in a manufacturing process.
The European Federation of Pharmaceutical Industries and Associations (EFPIA) supports the principle of mass
serialization, which means assigning unique product identification codes on the secondary packaging of all
pharmaceutical products, sold in the EU. A few member countries (France, Turkey, Belgium, etc.) have adopted
2D barcodes for mass serialization and are seriously working on it.
Conclusion
We understand that it is very important for all stakeholders in the supply chain or any value chain to collect data
easily and thus help in improving the process. In this regard, 2D barcodes with camera phone will improve the
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Next generation barcode-2D and its business implications
process of entering data into mobile devices and revolutionize the way the data is collected today. Now GSMA
and OMA have taken initiatives to standardize the 2D barcodes scanning process such that a widespread use can
be seen in future. It is also important for all industries to standardize the content and type of 2D barcodes used
such that adoption will be faster.
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Next generation barcode-2D and its business implications
About TCS RFID & Sensor Group
Tata Consultancy Services’ (TCS) Niche Technology Deliver Group (NTDG) leverages the company’s deep domain
and industry vertical experience with its respective ISUs to develop solutions across market segments. Successful
RFID and related solution-building is based on the Group’s comprehensive understanding of the appropriate
technology and how it fits into the overall business objectives of each customer. TCS’s differentiator in the RFID
domain is the NTDG’s complete, single-source menu: hardware, infrastructure, middleware and applications,
business process and integration, solution development and deployment, and more.
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About Tata Consultancy Services
Tata Consultancy Services is an IT services, business solutions and outsourcing
organization that delivers real results to global businesses, ensuring a level of certainty
no other firm can match. TCS offers a consulting-led, integrated portfolio of IT and ITenabled services delivered through its unique Global Network Delivery ModelTM
recognized as the benchmark of excellence in software development.
A part of the Tata Group, India’s largest industrial conglomerate, TCS has over 100,000 of
the world's best trained IT consultants in 50 countries. The company generated
consolidated revenues of US $5.7 billion for fiscal year ended 31 March 2008 and is listed
on the National Stock Exchange and Bombay Stock Exchange in India.
For more information, visit us at www.tcs.com.