The Future Is Now

How we are becoming a micro-chipped population


Imagine no more grocery lines. Imagine no more lost children. Imagine your television, cell phone or laptop warning you the milk in your fridge is old. Now imagine most of these things are happening right now.

Radio Frequency Identification (RFID) technology collects information by using tiny microchip "tags" which are embedded "tagged" into products, animals and people. The chips are then tracked by "readers" at a distance, possibly through clothing, purses or wallets.

Some large retailers plan to replace barcodes with RFID for supply and payment purposes, but it can also identify who bought an individual item, when and where, and how it was paid for. Most importantly, RFID can track products after they have left the store, meaning it can track you. Privacy advocates are concerned.

Welcome to the future. It began yesterday.

In June 2003, Wal-Mart announced its Electronic Product Code (EPC) initiative, ordering its top 100 suppliers to start using RFID tags on cases and pallets headed for the Dallas, Texas, area. The suppliers were given a deadline of January 2005.

"It will become a requirement," said Linda Dillman, Wal-Mart's CIO.

One year later, Dillman echoed the same deadline, but to Wal-Mart's top 300 suppliers.

"Over the next 16 months, we also plan to significantly increase the number of Wal-Mart stores and Sam's Club locations where customers can benefit from this revolutionary technology," she said.

Although Dillman has repeatedly declined to say how much the new technology is costing the company, she has admitted it is a "top line" item.

RFID is such a priority for Wal-Mart, that testing has begun at their Dallas-metro warehouses. Cases and pallets of dozens of products use microchips when delivered to a distribution center, where readers installed at dock doors automatically notify staff and suppliers that a specific shipment has arrived. 

Although the testing began at the case and pallet level, some products use their casing for its package, and are therefore already "tagged." Wal-Mart states three products-two Hewlett-Packard Photosmart photo printers and an HP ScanJet scanner-may feature tags on the outer packaging.

"The industry plan is to put an RFID tag on every product on Earth to identify and locate them at any time, anywhere," said Katherine Albrecht, founder and director of CASPIAN (Consumers Against Supermarket Privacy Invasion and Numbering). "Wal-Mart is taking the first steps to creating a society where everything could be surveilled at all times."

Wal-Mart and HP aren't alone. Several companies, including Target, Cola-Cola, Proctor & Gamble (P&G) and Gillette, have publicly stated they want RFID to revolutionize retail sales by helping them better supply their products to customers.

Headquartered in Boise, Albertsons, Inc. announced in March it expects its top 100 suppliers to use RFID at the case and pallet level by April 2005. Albertsons operates about 2,300 stores under half a dozen names in 31 states.

"RFID is a cutting-edge tool that will give us a win-win advantage with both customers and suppliers," said Gabe Gabriel, an executive vice president. 

According to "RFID and Consumers: Understanding Their Mindset," a Cap Gemini Ernst & Young study, "RFID allows companies to gain a competitive advantage. ... Reaching this future state, however, will require gaining the trust of consumers before they find RFID tags in their shopping carts."

But consumers have already started trusting retailers with their privacy. Dozens of retailers already use Smart Cards/Preferred Cards to assess what individuals are buying. According to a recent AC Nielson Frequent Shopping Survey, more than 70 percent of shoppers participate in two or more preferred-card programs. 

But microchipped products could allow these companies to know what their customers are doing after they leave their store, in real time, in almost every aspect of life. The surveillance scenario is possible when the tags are not "killed" or deactivated after products are purchased.

The retail tags are passive, but can be scanned an average of 15 to 20 feet by readers that various companies want to embed in doorways and floors at banks, shops, airports, libraries and homes. Active tags can transmit signals as far as you'd like.

Last November The Chicago-Sun Times revealed that Wal-Mart conducted a secret RFID trial in Oklahoma. The article reported customers bought P&G's Lipfinity brand lipstick with RFID tracking devices embedded in the packaging. Although Wal-Mart previously denied any consumer-level RFID testing in the United States, representatives declined to comment on the incident.

Business Week Online wrote about a protest at the German Metro "Future-store" last winter, after RFID tags were discovered in loyalty cards, shopping carts, packages of Kraft's Philadelphia cream cheese, P&G's Pantene shampoo and Gillette razors.

The protestors complained they were never told about the chips in the loyalty cards.

Metro spokesman Albrecht von Truchsess said the chips were only put in the cards to prevent youths from renting adult films.

"We're not the CIA," he said.

CASPIAN's Web site ( reported an incident where Gillette used "spy shelves" at a store in England. Whenever a shopper picked up a packet of razor blades from a shelf, a hidden camera secretly took a photo of the shopper's face.

The Web site links to Gillette Vice President Richard Cantrell discussing the technology, called Auto-Id, created by EPCglobal, whose major clients include Bechtel (widely criticized for its contract-bidding procedures in Afghanistan and Iraq).

Several retailers, led by P&G, oppose RFID legislation that would require them to deactivate tags after checkout. Some concerned citizens believe only using cash will protect their privacy, but paper currency may not be the last bastion for long.

There is a myth on the Internet that microwaving a $20 bill will make it burn due to an implanted RFID chip. The Boise Weekly conducted its own experiment and there was no such burning.

However, the U.S. Treasury Department has hinted that our currency will eventually have RFID chips implanted in it. Across the pond, the European Union appears to be planning to implant chips in Euros by 2005.

This means your "former" cash, and anything you bought with it, could be traced to you. Police investigators could use any crime-scene object to interrogate the last person involved with the object's last transaction.

Because of RFID's potential accuracy for identification, some organizations believe it can promote good security, by any means necessary.

Last month, Mexican Attorney General Rafael Macedo de la Concha announced he and 160 members of his staff were implanted with RFID chips, which allow them access to secure areas of his headquarters.

"It's only for access, for security," he said.

More Mexican government officials may soon get tagged, including key members of the military, police and staff members of President Vicente Fox.

"Promoting implanted RFID devices as a security measure is downright 'loco,'" responded Albrecht. "Advertising you've got a chip in your arm that opens important doors is an invitation to kidnapping and mutilation."

She described a Mexican kidnapping gang nicknamed "el chip," for reportedly demanding its victims point out the locations of their implanted chips.

But Americans may not have to travel to Mexico to get mutilated for their microchips. In fact, they may only need to step out of their house.

Introducing the ChipMobile, a tranquil blue and white recreational vehicle tirelessly traveling to a city near you to microchip your entire family. The RV is owned by VeriChip, which is owned by Applied Digital, who also owns Digital Angel. The three companies combine services to ensure all personal and corporate needs for microchips are covered.

The Digital Angel consists of a device similar to a wristwatch and a belt-worn module. It is marketed for concerned citizens to locate Alzheimer's patients, the mentally challenged or anybody else wearing the device. It can locate them anywhere from any P.C. This service costs $9.95 per month.

VeriChip's Web site states, "We are promoting VeriChip as a universal means of identification. We expect it to be used in a variety of applications including financial and transportation, security, residential and commercial."

VeriChip was just rewarded a $600,000 contract to start implanting 200,000 dogs in Portugal, under a government initiative to control rabies. Chief Executive Kevin McGrath estimated RFID helped return 72,000 animals in the United States last year.

Never mind lost dogs, RFID locates lost children. The Great America amusement park in Santa Clara, California, has the Star Watch program, where kids can wear wristbands that broadcast signals to antennas scattered throughout the park. A central computer tracks the children and sends their location to seven interactive kiosks placed around the park.

In Osaka, Japan, school authorities have decided to test RFID in one primary school. The tags will be put onto kids' schoolbags, nametags or clothing, in conjunction with readers at the school gates and other "key locations." Denmark started a similar scheme in June. 

There are endless creative uses for RFID. British-based Innovasion developed a reader that supports Near Field Communication (NFC), a new standard that will allow electronic devices to download music or theater tickets from "smart" posters. The reader, called Io, is smaller than a dime, making it the smallest yet created.

"NFC has all the right building blocks for many applications," said Innovasion's Marc Borrett.

He said the first products could be deployed in 12 to 18 months, when users could use NFC phones to swap music and more. A recent demonstration showed a businessperson using such a phone to check in at an airport, collect a digital key at their hotel and pay their bill electronically upon check out.

"This isn't a pie-in-the-sky scenario," Borrett said.

When home appliances and related products become chipped and connected to computers, anything is possible. Your fridge could alert your television the milk has passed its expiration date (would you like to order more?). Insurance companies could require "smart" medicine cabinets to help ensure you are properly taking the right drugs.

Steve David, chief information officer for P&G, has said prescription drug counterfeiting costs the pharmaceutical industry $500 billion worldwide, and backshop thefts costs companies another $50 billion per year.

The pharmaceutical industry estimates that between 2 and 7 percent of all drugs sold globally are counterfeit. The Food and Drug Administration has asked manufacturers to consider RFID technology to help combat counterfeit drugs.

The list of current RFID research and development grows: the San Francisco library wants to ease document inventory and checkout; hospitals use it to match babies, medications and allergies; airlines are matching luggage; police departments debate tagging officers so that only they may fire modified firearms.

But to be sure, RFID's greatest controversy surrounds its proliferation among retailers. Barry Steinhardt, an American Civil Liberties Union lawyer, warned a RFID conference last April that companies could profile their customers and share that information with the government, which would violate their privacy policies.

Last February, the Utah House of Representatives passed a bill mandating clear labeling of RFID-chipped products. At the same time, the California Senate considered stronger legislation, arguing retailers should need consumers' permission to use RFID.

In response, the Grocery Manufacturers of America (representing Coca-Cola, P&G, Gillette and others) is trying to draft its own legislation before more stringent laws are passed.

Albrecht intends to keep an eye on all the retailers, she is prepared to organize boycotts.

"When the world's largest retailer (Wal-Mart) adopts a technology with chilling societal implications, and does so irresponsibly, we should all be concerned," she said.

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