SAW tags were invented more than 30 years ago, but only today are the conditions united for mass application of this technology. The devices in the 2.4-GHz ISM band can be routinely produced with optical lithography, high-resolution radar systems can be built up using highly sophisticated, but low-cost RF-chips, and the Internet is available for global access to the tag databases. The "Internet of Things," or I-o-T, will demand trillions of cheap tags and sensors. The SAW tags can overcome semiconductor-based analogs in many aspects: they can be read at a distance of a few meters with readers radiating power levels 2 to 3 orders lower, they are cheap, and they can operate in robust environments. Passive SAW tags are easily combined with sensors. Even the "anti-collision" problem (i.e., the simultaneous reading of many nearby tags) has adequate solutions for many practical applications. In this paper, we discuss the state-of-the-art in the development of SAW tags. The design approaches will be reviewed and optimal tag designs, as well as encoding methods, will be demonstrated. We discuss ways to reduce the size and cost of these devices. A few practical examples of tags using a time-position coding with 10(6) different codes will be demonstrated. Phase-coded devices can additionally increase the number of codes at the expense of a reduction of reading distance. We also discuss new and exciting perspectives of using ultra wide band (UWB) technology for SAW-tag systems. The wide frequency band available for this standard provides a great opportunity for SAW tags to be radically reduced in size to about 1 x 1 mm(2) while keeping a practically infinite number of possible different codes. Finally, the reader technology will be discussed, as well as detailed comparison made between SAW tags and IC-based semiconductor device.