Radio ID tags stir privacy concerns

David Ho/Cox News Service | August 15 2005

Secretary Tommy Thompson may not have a chip on his shoulder, but he plans on getting one under his skin.

Thompson, who recently joined the board of the company that owns VeriChip, is having one of its radio-frequency ID tags implanted to promote the technology, which he called a "secure means of accessing medical records and other information."

While the chips are primarily intended in the United States to provide doctors with potentially lifesaving patient information, Thompson’s announcement this summer grabbed the attention of privacy advocates already worried about an Orwellian future where people can be tracked by ubiquitous radio-frequency ID tags in everything from cars to clothes. "For the first time, I had a moment of real trepidation," said Katherine Albrecht, founder and director of CASPIAN (Consumers Against Supermarket Privacy Invasion and Numbering). "People really don’t like the idea of remote tracking devices being slipped into their clothes, their shoes and their passports," she said.

Scott Silverman, chairman and chief executive of Applied Digital, the Delray Beach, Fla.-based firm that owns VeriChip, argues that getting a chip is voluntary and the chip can only be read by the company’s scanners. "The fact that this is tamperproof, in your body and with you all the time in essence enhances your privacy," Silverman said. He said personal informa- tion in wallets and on the Internet is far more vulnerable.

The privacy debate has escalated recently as radio-frequency ID, or RFID, use has spread among businesses. In 2003, clothing giant Benetton backed off introducing radio tags into individual garments after the plans prompted protests.

As RFID users weigh the possibility of a consumer backlash, they’re also dealing with technical challenges that have slowed the implementation of a technology widely seen as a more efficient successor to the familiar product bar code.

RFID tags contain electronics that broadcast small bits of information — often a long number — when exposed to radio signals sent by a "reader" device. The number is linked to information in a computer system.

Another form of the technology, found in systems such as the EZPass highway toll payment device, uses a battery to broadcast a signal.

The technical challenges include finding ways for the tags to work consistently in different environments where interference can block the signals, said Dennis Gaughan, research director with AMR Research in Boston. He said the most common tags are also still too expensive at about 40 cents each, and need to fall to 5 cents or less.

Big retailers like Wal-Mart Stores Inc. and Target Corp. are leading the push to adopt RFID by requiring suppliers to attach the tags to case and pallet shipments. The primary goals are to improve inventory tracking, reduce theft and prevent items from being out of stock in stores.

Other retailers use the technology in plastic anti-theft tags or for wireless payments, such as ExxonMobil’s Speedpass system.

But the rush to adoption has been hard on suppliers, Gaughan said. "Right now the economic impact for consumer goods companies that are forced to comply is terrible, because the cost of the tags and the infrastructure is still very high," he said. "You’re talking about tagging products whose value is very, very low in many cases."

Privacy concerns have not slowed the technology’s growth so far because companies are mainly using RFID for behindthe-scenes inventory tracking, Gaughan said.

However, he said, retailers are "planning on being very upfront in what they’re going to do, because they don’t want the kind of bad publicity that can go with subversively putting RFID tags on products without telling their customers."

Wal-Mart addressed these issues when it announced its radiofrequency ID plans last year. "We can certainly understand and appreciate consumer concern about privacy," chief information officer Linda Dillman said. "RFID tags will not contain nor collect any additional data about consumers. In fact, in the foreseeable future, there won’t even be any RFID readers on our stores’ main sales floors."

However, she said there could be more potential uses for the technology "down the road."

Privacy groups fear that RFID codes eventually will be linked to consumer personal information, allowing people to be identified and tracked by products on their person.

Albrecht said companies should be required to label products containing RFID tags. "It’s very easy to slip the RFID into items," she said. For example, she said there could be a situation where the only item authorized to transmit a certain number is her left shoe, allowing her to be pinpointed.

The scenario is not technically far-fetched. For a few years, registered runners in the Boston Marathon have had radio-frequency ID chips added to their shoes. A computer system identifies runners as they pass over special mats containing tag readers to track their progress.

A next-generation RFID chip, available as early as next year, will be capable of being permanently disabled when an item is purchased and could help address privacy concerns, Gaughan said.

The use of chips inside people also is growing.

The Palm Beach Orthopedic Institute in Palm Beach Gardens, Fla., has been using Surgichip, an RFID system that identifies patients and confirms their procedures before surgery to prevent mistakes.

About 2,000 VeriChips have been implanted in people worldwide, with about 50 in the United States since the Food and Drug Administration approved them in October, said Silverman, the Applied Digital executive.

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