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Radio Frequency IDentification (RFID) is an automatic identification method, relying on storing and remotely retrieving data using devices called RFID tags or transponders. An RFID tag is an object that can be attached to or incorporated into a product, animal, or person for the purpose of identification using radio waves. Chip-based RFID tags contain silicon chips and antennas. Passive tags require no internal power source, whereas active tags require a power source.
An RFID system may consist of several components: tags, tag readers, edge servers, middleware, and application software.
The purpose of an RFID system is to enable data to be transmitted by a mobile device, called a tag, which is read by an RFID reader and processed according to the needs of a particular application. The data transmitted by the tag may provide identification or location information, or specifics about the product tagged, such as price, color, date of purchase, etc. The use of RFID in tracking and access applications first appeared in 1932, to identify aircraft as friendly or unfriendly ("identify friend or foe" (IFF)). RFID quickly gained attention because of its ability to track moving objects. As the technology is refined, more pervasive and possibly invasive uses for RFID tags are in the works.
In a typical RFID system, individual objects are equipped with a small, inexpensive tag. The tag contains a transponder with a digital memory chip that is given a unique electronic product code. The interrogator, an antenna packaged with a transceiver and decoder, emits a signal activating the RFID tag so it can read and write data to it. When an RFID tag passes through the electromagnetic zone, it detects the reader's activation signal. The reader decodes the data encoded in the tag's integrated circuit (silicon chip) and the data is passed to the host computer. The application software on the host processes the data, and may perform various filtering operations to reduce the numerous often redundant reads of the same tag to a smaller and more useful data set.
Take the example of books in a library. Security gates can detect whether or not a book has been properly checked out of the library. When users return items, the security bit is re-set and the item record in the Integrated library system is automatically updated. In some RFID solutions, a return receipt can be generated. At this point, materials can be roughly sorted into bins by the return equipment. Inventory wands provide a finer detail of sorting. This tool can be used to put books into shelf-ready order.

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