Hibiki Project and Secure RFID Project

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1 Hibiki Project and Secure RFID Project October 22, 2007 Hitachi, Ltd. Yo Nakajima Hitachi, Ltd All rights reserved About Hitachi 2. Hibiki Project / Secure RFID Project 3. Cases in Japan 4. Conclusion Hitachi, Ltd All rights reserved. 1

1. About Hitachi Hitachi, Ltd. 2007. All rights reserved. 2 1-1 Hitachi overview Net Sales: Total Assets: Total Employees: 10,248 Billion Yen (US $86.8 Billion) 10,644 Billion Yen (US $90.

2 1. About Hitachi Hitachi, Ltd All rights reserved Hitachi overview Net Sales: Total Assets: Total Employees: 10,248 Billion Yen (US $86.8 Billion) 10,644 Billion Yen (US $90.2 Billion) 384,444 (As of March 30, 2007) Fortune Global rd (2004 Sales in Global Electronics, Electrical Equipment and Computer Industries) Original Repair Shop Ibaraki 1910 Hitachi, Ltd All rights reserved. 3

1-2 Hitachi overview Europe, Middle East & Africa 84

6 Billion Sales Hitachi Europe Ltd. Maidenhead, U.K.

Tokyo, Japan Japan 540 Companies 243,000 Employees $53.

Employees $8.4 Billion Sales Hitachi America Ltd.

Employees $2.4 Billion Sales Hitachi, Ltd. 2007.

4 1-3 Revenues breakdown by segment (2006) Power &

Functional Materials & Components 15% Digital Media &

3 1-2 Hitachi overview Europe, Middle East & Africa 84 Companies 5,000 Employees $6.6 Billion Sales Hitachi Europe Ltd. Maidenhead, U.K. Asia & Oceania 240 Companies 78,000 Employees $13.1 Billion Sales Hitachi(China), Ltd. Beijing, China Hitachi Asia Ltd. Singapore Hitachi, Ltd. Tokyo, Japan Japan 540 Companies 243,000 Employees $53.7 Billion Sales North America 76 Companies 15,000 Employees $8.4 Billion Sales Hitachi America Ltd. Brisbane, California Other Areas 46 Companies 6,000 Employees $2.4 Billion Sales Hitachi, Ltd All rights reserved Revenues breakdown by segment (2006) Power & Industrial Systems 26% Services & Others 14% High Functional Materials & Components 15% Digital Media & Consumer Products 13% Electronic Devices 11% Information & Telecommunication Systems 21% Network Storage Server Software SI Outsourcing Consulting Hitachi, Ltd All rights reserved. 5

4 1-4 Hitachi s RFID product μ-chip series µ-chip 2.45GHz Hitachi proprietary air interface protocol Unique ID (128bits) in each μ-chip Non re-writable physical ID data No application data in μ-chip High preventively for ID counterfeiting -Smallest chip size 0.4x0.4mm µ-chip Hibiki MHz (UHF) Traceability RFID Movie(4 min) Hitachi proprietary air interface protocol ISO TypeC (EPCglobal Gen2 ) Unique ID (128bits) in each μ-chip Secure RFID functions Non Privacy re-writable protection physical ID data Industrial memory area protection Based on Hibiki Project / Secure RFID Project 2 Hitachi, Ltd All rights reserved Hibiki Project / Secure RFID Project Hitachi, Ltd All rights reserved. 7

2-1 Schedule Hibiki Project : 2 years Secure RFID Project : 8 month Design Prototype evaluation Hitachi, Ltd. 2007. All rights reserved.

<5cent,100Munit/month) (METI: Ministry of Economy, Trade and Industry) Hibiki Project (08/04 ~ 07/06) Apply to global business (Global Standard) Stable

5 2-1 Schedule Hibiki Project : 2 years Secure RFID Project : 8 month Design Prototype evaluation Hitachi, Ltd All rights reserved Objective National Project Conducted by METI to Boost Efficiency and Create Business Opportunity Inexpensive RFID (5-yen (5-yen inlay inlay : : <5cent,100Munit/month) (METI: Ministry of Economy, Trade and Industry) Hibiki Project (08/04 ~ 07/06) Apply to global business (Global Standard) Stable Supply (Volume of of Production, High High Reliability) Privacy Protection Secure RFID Project (08/06 ~ 03/07) Keep Trade data in in Secrecy Hitachi, Ltd All rights reserved. 9

6 2-3 Formation Conducted by RENESAS Core companies YAGI Cooperating companies DNP TOPPAN NEC FUJITSU IBM * From Aug 06 Hitachi, Ltd All rights reserved Specifications 1. Technological Achievement for material, design and manufacturing process to realize inexpensive Tag. (5-yen inlay : <5cent,100Munit/month) 2. Air Protocol - Frequency: UHF(860~960MHz) - ISO TypeC (EPC Global Gen2 ) 3. Specifications - memory size: 2,128bits - Re-writable - Read range: 3m +, Write range: 1m + - Privacy Protection - Industrial Memory Area Protection Hitachi, Ltd All rights reserved. 11

2-5 Prototypes IC chip for tag Wafer IC chip Inlay for IC tag

3 [mm] Reader/Writer (for evaluation) Reader/Writer Antenna

Multi Tag Reading (Transmission rate 160kbps) 200 175(88%) 180

50(100%) Number of Tags 200 100 50 118(59%) 86(86%) 47(94%) 20 0

7 2-5 Prototypes IC chip for tag Wafer IC chip Inlay for IC tag Dipole inlay 4 inch inlay 154x 13 x 0.3 [mm] 100 x 10~25 x 0.3 [mm] Reader/Writer (for evaluation) Reader/Writer Antenna Reader/Writer IC chip for Reader/Writer Hitachi, Ltd All rights reserved Reading Ability (Passing Speed) Number of reading tag Multi Tag Reading (Transmission rate 160kbps) (88%) (79%) (100%) 50(100%) 97(97%) 50(100%) Number of Tags (59%) 86(86%) 47(94%) m/min 100m/min 200m/min Passing speed Multi Tag Reading 50 Boxes 100 Boxes 200 Boxes Hitachi, Ltd All rights reserved. 13

2-7 Field trials - Retail (Future store) - Food

8 2-7 Field trials - Retail (Future store) - Food Traceability - Robotics - Defense - Multi National Supply Chain - Publication and music - Pharmaceutical - Electronics - ASEAN Wide Logistics etc. Hitachi, Ltd All rights reserved Publishing industry Embedded Hibiki Multi Reading Hitachi, Ltd All rights reserved. 15

9 2-9 Issues (1) Privacy Protection (2) Corporate Information Protection (3) Improvement of Environmental Performance (4) Sticking Support (5) Improvement of IC Tag Reading Rate Hitachi, Ltd All rights reserved Secure RFID Project (1) Privacy Protection (2) Industrial Memory Area Protection Secure RFID Project (Aug Mar. 2007) Secure RFID Movie(4 min) Hitachi, Ltd All rights reserved. 17

10 2-11 Secure RFID Function(1) Privacy Protection Shop Consumer Recycle& Maintenance Sales Consumption Deactivation Reactivation ISO TypeC Secure RFID If tag is killed, it can not be used Recycle & maintenance stage. Limitation of read distance Read lock of privacy sensitive data Hitachi, Ltd All rights reserved Secure RFID Function(2) Industrial Memory Area Protection ISO TypeC Secure RFID Project Tag memory Reserved UII TID User Appliance Manufacturer Retailer Repair Shop Tag memory Reserved UII TID Model name,id Shop ID,Shipping ID Arrival ID,record Hitachi, Ltd All rights reserved. 19

2-13 Roadmap 2001 2006 2007 2008 able to use licensed partner s reader as of Sep.,2007 μ-chip Unique ID Anti-collision 2.

11 2-13 Roadmap able to use licensed partner s reader as of Sep.,2007 μ-chip Unique ID Anti-collision 2.45GHz ROM Hitachi proprietary protocol μ-chip Hibiki UHF( MHz) EPCglobal Gen2 06/11 Evaluation kit for Japan 07/11 -Global -Security ISO TypeC Hibiki project [METI] Secure RFID project [METI] Hitachi, Ltd All rights reserved Roadmap μ-chip Hibiki able to use licensed partner s reader as of Sep.,2007 μ-chip Unique ID Anti-collision 2.45GHz Seal Label ROM High Power Reader/Writer Antenna for Reader/Writer Hitachi proprietary protocol Features of μ-chip Hibiki 06/11 μ-chip Hibiki - Frequency: UHF(860~960MHz) - ISO Type C (EPC Global Gen2) - memory UHF( MHz) size: 2,128bits - Privacy Protection - Industrial EPCglobal Memory Area C1G2 Protection Price and Shipping Start Time (in Japan) Seal Label Hibiki project [METI] Evaluation kit for Japan μ-chip Hibiki Shipping Date Sample 2007/11/30 production(500piece/roll) 2008/2/29 High Power Reader/Writer(1unit) Secure 2007/11/30 RFID project [METI] Antenna for Reader/Writer(1unit) 2007/11/30 07/11 -Global -Security Hitachi, Ltd All rights reserved. 21

12 3. Cases in Japan Hitachi, Ltd All rights reserved Outline Consumer- electronics industry - Trial for RFID Introduction by main Manufacturer, Distributor, Retailer in Japan - Application for Pre-Logistics,Repair/Maintenance etc. on Product Supply Chain - Reading RFID Tag to check Arrival, Shipment, Sale etc. Information Management /Reference Manufacturer Data Center PLM DB Retailer Product Supply Chain Arrival & Shipment inspection information etc. Manufacturer Distributor Retailer Consumer Hitachi, Ltd All rights reserved. 23

3-2 Consumer- electronics industry Pre-Logistics Outline Distribution Center Retailer Product Information Data

defective product Improvement for Operation Efficiency and Accuracy information Product Supply Chain Arrival &

24 3-3 Consumer- electronics industry Repair/Maintenance Outline Repair Reception desk at Retailer

Confirm Repair progress in real time information rapidly Arrival & shipment inspection Improvement for

13 3-2 Consumer- electronics industry Pre-Logistics Outline Distribution Center Retailer Product Information Data Center Automatically check arrival and shipment by reading RFID Tags Confirm Product Stock,and Discovery defective product Improvement for Operation Efficiency and Accuracy information Product Supply Chain Arrival & shipment inspection Manufacturer Distributor Retailer Consumer Hitachi, Ltd All rights reserved Consumer- electronics industry Repair/Maintenance Outline Repair Reception desk at Retailer Manufacturer Guarantee Card tag Retailer attached Product Information Data Center Confirm Product and Sales Confirm Repair progress in real time information rapidly Arrival & shipment inspection Improvement for Customer Satisfaction information Product Supply Chain Manufacturer Distributor Retailer Customer Hitachi, Ltd All rights reserved. 25

流物立日 3-4 Returnable cage management Retailer Superstore Many returnable cages are lost Huge cost of filling up the cages

4 million $ Supplier Distribution center Retail shop returnable cage Delivery Return the cages Gate Delivery Return the cages Reader

information to email (PC or Mobile phone) automatically Hitachi, Ltd. 2007. All rights reserved.

14 流物立日 3-4 Returnable cage management Retailer Superstore Many returnable cages are lost Huge cost of filling up the cages 1,000cages/year lost! over 1.4 million $ Supplier Distribution center Retail shop returnable cage Delivery Return the cages Gate Delivery Return the cages Reader antenna Load on truck Tag of μ-chip Hibiki embedded μ-chip Hibiki Manage the each cage location point automatically Send delivery information to (PC or Mobile phone) automatically Hitachi, Ltd All rights reserved Returnable cage management Returnable cage Tag embedded μ-chip Hibiki Shipping Gate Reader Antenna passage Attach the tag embedded μ-chip Hibiki on returnable cage This tag is not influenced from metal environment Tag data on the each cage is read automatically Hitachi, Ltd All rights reserved. 27

3-6 Hitachi, Ltd receiving Manufacturing PCB(Print Circuit Board) production factory check stock (part) production Inspection stock SOW SOW label label printer Cell RFID on label Procurement

15 3-6 Hitachi, Ltd receiving Manufacturing PCB(Print Circuit Board) production factory check stock (part) production Inspection stock SOW SOW label label printer Cell RFID on label Procurement Reader/Writer on the truck Inventory RFID on SOW *SOW: Statement of Work Dynamic Production Appropriate work space layout Find out the bottleneck process Improvement the work efficiency lead time 20% reduction Hitachi, Ltd All rights reserved Conclusion Hitachi, Ltd All rights reserved. 29

16 4 Conclusion Chip/Device Customers & Partners Consulting Use Case Hardware Software Solution/Service Customers & Partners Hitachi Inspire the Next Contributing to the world Hitachi, Ltd All rights reserved. 30 Thank you!

Hitachi s History of Transformation

Management Strategy Hitachi s History of Transformation (Fiscal 2004 Fiscal 2013) Recovery from management crisis and on to a new growth stage. In fiscal 2013, Hitachi achieved new record highs in operating