RFID Proponents Respond to Consumer Privacy Concerns

Proponents of radio frequency identification used to have a quick and easy response to consumer advocates charging that the technology


BALTIMORE -- Proponents of radio frequency identification used to have a quick and easy response to consumer advocates charging that the technology posed an alarming threat to privacy.

Wal-Mart Stores, Procter & Gamble and other big companies pushing the electronic tracking tags said they'd use them only in warehouses to more easily locate and account for stock arriving in cases and palettes. By the time the merchandise hit store shelves, they'd have removed the tags. The placement of tags on items consumers actually take home was projected to be at least 10 years away, last year's argument went. Some said it may never happen if costs remained prohibitive.

But widespread "item-level" tagging may actually happen much sooner--more a question of when, not if--discussions here at a radio frequency identification (RFID) conference indicate. Pharmaceutical companies are gearing up to slap tags on individual packages of certain prescription drugs within the next three years, under a mandate from the Food and Drug Administration, according to executives in that industry speaking at this week's conference.

Retailers don't have such a mandate but are tip-toeing that direction anyway. A Wal-Mart store in Dallas is already selling Hewlett-Packard printers and scanners with RFID tags on their boxes, said Elizabeth Board, executive director of the public policy steering committee for EPCglobal, organizer of the EPCglobal U.S. Conference 2004 trade show. EPC stands for electronic product code, a new product numbering system linked to RFID that could someday replace the less-precise bar code systems.

Though relatively rare today, RFID tags are marching toward stores and shopping baskets across the country--raising questions about the implications for consumers. Also experimenting with RFID are Albertsons, Best Buy, Target, as well as European chains Metro and Tesco.

"There is a concern that EPC (tags) can be tracked everywhere and that retailers want to track you at all times of the day," Board, who joined ECPglobal in April to lead the group's lobbying efforts, said during a panel discussion. "It's not realistic, but it has caused a lot of confusion."

She expects that fears about privacy invasion will continue to be a public relations problem for the technology. RFID supporters must do more to dispel the myths and misconceptions surrounding it, she said. Broad has been meeting with state and federal legislators taking an interest in the privacy debate. Legislators at the state and national level have held hearings on RFID and privacy, and some states have introduced bills that would impose restrictions on the technology. States are keeping Board especially busy--as many as 15 are "seriously looking at the issue," she said.

RFID systems work by placing special microchips--RFID tags--on merchandise. The tags signal their location across a network of readers placed on shipping docks, in warehouses and stores, allowing retailers and manufacturers to monitor products as they travel from factory to store shelves. Through an EPC code, a one-of-a-kind serial number, RFID tags can also store a wealth of information about the item with which it's associated, including where it's been, who bought it and when.

Privacy activists worry that consumers could leave stores broadcasting all kinds of information about their belongings. They fear that, with the right tools, anyone--including thieves--could detect what's in your purse or pockets. Another concern is that people?s things would leave an electronic trail of their whereabouts and shopping habits for law enforcement officials, investigators, lawyers or marketers to collect.

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