Tagging Toothpaste and Toddlers

Information Management Journal, Sep/Oct 2004 by Swartz, Nikki

Radio frequency identification (RFID) technology has been used for about a decade, most commonly in the E-ZPass system that enables drivers to speed through East Coast tollbooths. But now the technology is cheap and robust enough to expand to other uses.

For example, the U.S. Department of Homeland security soon will begin using RFID technology at U.S. border checkpoints. According to The Washington Post, officials in Great Britain are discussing proposals to embed tags in vehicle license plates. IBM wants banks to issue its best customers cards containing the tags, allowing them to be given special treatment. The U.S. Food and Drug Administration is pushing the pharmaceutical industry to tag medicines by 2007. Delta Airlines recently announced that it will invest $25 million to deploy disposable radio tags to track and locate lost luggage, which costs the airline $100 million annually. Las Vegas' McCarran International Airport said it will begin attaching radio tags this fall to all luggage checked there. Retail giant WalMart is rolling out radio-tagging on product shipments from 300 of its suppliers by early 2006.

For retail use, radio-tagging is meant to help reduce theft, better locate items, better match supplies to demand for products, and speed distribution. Unlike barcodes, which must be passed in front of a scanner, RFID tags can be read remotely by a device up to 20 yards away, reducing the time and labor needed to take inventory and replenishing stocks more quickly when they are low. They also carry much more data than a barcode.

But the technology has privacy watchdogs, as well as some government officials, worried about the possibility of abuse in the tracking of goods and people. Radio signals can be detected through cardboard, clothes, and, in some cases, walls. For example, tags sewn into clothing or embedded into shoes would make it possible to track consumers as they enter or leave stores, possibly allowing retailers to track products or consumers after they leave the store.

"RFID has tremendous potential for improving productivity and security, but it also will become one of the touchstone privacy issues of our times," Sen. Patrick J. Leahy (D-Vt.) told the Post For example, a California company has developed a soap dispenser capable of reading employee tags to let restaurant managers know whether their workers wash their hands while in the bathroom. A Buffalo, N.Y. charter school tags its students as a way of taking morning attendance. Denmark's Legoland amusement park launched a child-tracking system that combines RFID tags and Wi-Fi technology to allow parents to keep track of their children, who must wear rented wireless-enabled wristbands that can track them within 5 feet of their location. School officials in Osaka, Japan, are chipping children in one primary school to track their movements. The chips will be put into kids' schoolbags, name tags, or clothing and scanned by readers installed in school gates and other locations.

The Post reported that a consortium of more than 40 public-interest groups has called for strict public-notification rules, the right to demand deactivation of the tag when people leave stores, and overall limits on the technology's use until privacy concerns have been better addressed. Legislation has been proposed in California that would require any business selling consumer goods to remove or destroy all item-level RFID tags before the item leaves the store. In at least three states, legislators have introduced bills to limit RFID use, such as requiring companies to remove RFID tags from products once they are purchased. Privacy advocates want to know who will control the data collected from RFID tags and how it will be used. The technology is not perfect or even always accurate. It is plagued by inaccuracies in reading the data, and certain metals and moisture on the tags can interfere with the signals.

According to CSO magazine, tags cost between 25 cents and $1, although experts believe they will cost a penny or less by the end of the decade. This means RFID tags will be used in force by 2005, and many companies even expect it to be important to their organization's business strategy.

In a recent study, "RFID Adoption: Current and Future Plans," conducted by BearingPoint Inc., the Software & Information Industry Association (SIIA), and CIO magazine, 58 percent of 350 IT professionals surveyed reported that their organization will be in the trial or test phase of their RFID evaluations within one year. Fifty-one percent said they will deploy the technology within two years. Almost half (45 percent) of IT professionals said RFID is a revolutionary technology that will have widespread impact. Almost 60 percent said the technology was either important or very important to their business strategy. In 2004, 20 percent of organizations surveyed will invest between $250,000 and $1 million. Thirteen percent will invest more than $1 million, according to the survey.