The 463 will be closely watching the policy issues around the deployment of Radio Frequency Identification (RFID) technology. Here, we'll recap the technnology and touch upon some of the controversies that it's meeting on it's way to a wholesale roll-out....
Last week two groups of Washington policymakers both essentially said that, for now, the promise of RFID far exceeds any need for government regulation of the technology's applications.
Neither pronouncement made much news. It's likely because most even in the tech industry are still trying to get their arms around what RFID really is now and what it could potentially be. Plus, neither had inferences of wireless panties or kindergartners with chips in their head.
More on that later.... First a quick step back....
RFID would be one of those next big things -- except for the fact that it's a thing that's been around for long while.
Essentially, RFID is a technology that uses electronic tags comprised of a computer chip and antenna for storing data -- much like bar codes. However, RFID tags can store much more information than a bar code and can be read via close-range wireless technology (depending on the tag, the range is from 15 to 1500 feet).
The technology has been in use for decades, but has been increasing in presence in the last ten or so years. You might already use RFID if you have an electronic toll pass for bridges or toll roads. Wikipedia lists other uses, including: "beer keg tracking, automobile key-and-lock, anti-theft systems and animal identification" -- Pets are often embedded with small chips so that they may be returned to their owners if lost.
US Department of Defense and Wal-Mart have been major proponents of RFID for the last few years and are driving a substantial portion of current RFID adoption. The DoD wants to use the tags to increase the efficiency of military logistics. Wal-Mart wants all its suppliers to use RFID chips on pallets so they can better manage their inventory. In fact, Wal-Mart set a January 2005 deadline for its top 100 suppliers to begin shipping pallets and cases of goods with RFID tags. Retailers like Wal-Mart are do doubt incentivized to reap the following savings estimated by A.T. Kearney:
-Reduced inventory through a one-time cash savings estimated at 5 percent of total inventory.
-An annual benefit from a reduction in store and warehouse labor expenses of 7.5 percent.
-A reduction in out-of-stock items resulting in a recurring annual benefit of $700,000 per $1 billion in annual sales
Now, with the price of tags dropping and various communications mediums converging, much focus in being put on what RFID will bring beyond tracking pallets and helping logistics. For example, if each product in a supermarket carried a tag, than consumers could have their complete shopping carts scanned instantly. VeriSign also has been testing a Nokia phone with an RFID reader on it that can scan product tags and bring up deep information and marketing offers on the consumer items while you shop.
But, the interesting technology application chatter is no match for the outright noise coming on the privacy front. Playing the steel drums and trombones is an organization called CASPIAN (Consumers Against Supermarket Privacy Invasion and Numbering).
CASPIAN really hates RFID. They claim that RFID will bring massive privacy invasions by allowing businesses to secretly identify people and the things they are carrying or wearing. They conjure images of "Minority Report" and warn that personal belongings, including clothes, could constantly broadcast messages about their whereabouts and their owners. They suggest a covert cabal of corporate spies scanning neighborhood trash cans to research product usage patterns.
CASPIAN is supported by some legislators who share their fears. One notable entry in the public discourse submitted by California State Senator Debra Bowen:
"How would you like it if, for instance, one day you realized your underwear was reporting on your whereabouts?"
And, more than half (55%) of the Western European consumers recently polled said they were either concerned or very concerned that RFID tags would allow businesses to track consumers via product purchases. At the same time, there's still very little understanding or awareness of the technology in the general population.
The proponents of RFID note that tags could be designed to be turned off as they get scanned at registers and, regardless, the likely range of the consumer item tags will be so short that post-shopping voyeuristic scanning would be extremely difficult (and rather in-your-face or in-your-pantry. as it were). There's no doubt that those who will benefit most from RFID need to now take considerable active steps to counter the FUD against the technology and promote the many positive aspects of its use.
And, regardless of any education effort, much of the mainstream news about RFID in the coming year or so will likely cover a single application of RFID that doesn't do much to help mitigate Orwellian images among our most paranoid (or vigilant). This is the use of RFID tags to track humans.
Already, says Wikipedia:
"Applied Digital Solutions proposes their chip's "unique under-the-skin format" as a solution to identity fraud, secure building access, computer access, storage of medical records, anti-kidnapping initiatives and a variety of law-enforcement applications. Combined with sensors to monitor body functions, the Digital Angel device could provide monitoring for patients. The Baja Beach Club in Barcelona, Spain uses an implantable Verichip to identify their VIP customers, who in turn use it to pay for drinks. The Mexico City police department has implanted approximately 170 of their police officers with the Verichip, to allow access to police databases and possibly track them in case of kidnapping."
Not that there isn't anything wrong with any of this. In fact, there's a lot of right. The potential to save lives, stop crime and get a pitcher of sangria pronto is priceless.
Still, human RFID use will inevitably bring errors in judgement that create a downward spiral of negative media coverage at a time when the average consumer/voter is first learning what RFID is for the first time.
One very recent example...
Greg Lucas of the San Francisco Chronicle broke a story in February about a small northern California school district that mandated the use RFID tags on students made by a local company called InCom to track their on-campus presence....
"Angry parents, saying their children's privacy rights are being violated, have asked the board of the tiny Brittan School District to rescind a requirement that all students wear badges that monitor their whereabouts on campus using radio signals...
'"This is the only public school monitoring where children go, with kids walking around with little homing beacons,'' said Nicole Ozer, an American Civil Liberties Union lawyer...."
On the other hand....
'"It's baffling why so many people are bothered by the district being able to tell them where their kids are at,' said Tim Crabtree, a high school teacher who said he hoped the technology would come to his classroom.
Photo of badge here.
One week after the first Chronicle piece, the RFID test at in the Brittan School District was put on hold at a public forum....
"Despite InCom announcing an end to its testing, parents' emotions stayed high. Board President Don Hagland frequently had to interject to keep order among the nearly 150 parents and students in attendance."
The LA Times recaps what else happened in the month after the story first hit:
"Outraged parents claimed the school was trampling their children's privacy and civil liberties, maybe even threatening their health. School board meetings overflowed. Folks talked of George Orwell, Big Brother and the Bible. The American Civil Liberties Union joined the fray. Parents picketed. TV news crews from as far away as Germany descended on the 600-student school."
$10 gazillion in productivity savings doesn't photograph as well as a kid in braces wearing a transponder around her neck.
Still, as mentioned at the top, RFID advocates can be heartened by two governmental pronouncements this week (both covered by RFID Journal). The Senate Republican High Tech Task Force highlighted protecting RFID from regulation as one of the group's priorities for the year, saying "RFID holds tremendous promise for our economy, including military logistics and commercial inventory efficiencies, and should not be saddled prematurely with regulation."
These words came a day after the Federal Trade Commission (and the regulatory body most concerned with consumer privacy issues) said it will, for now, leave it to retailers and the RFID industry to educate consumers about use of radio frequency identification and data collected using the technology. The FTC also issued a report on RFID usage and how companies should address privacy issues. You can download it here. The FTC's decision won't have any impact on states wishing to create their own RFID related legislation.
The next few years will be interesting to watch. You get the feeling that if the consumer privacy issues are handled well, RFID adoption could be twice as fast as if they are not.