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NANOCHIP TAKES PRODUCT TRACKING TO NEW
LEVEL
By NAOMI SNYDER
Staff Writer For
The Tennessean
When Wal-Mart acts, the world of commerce
listens. That's why Wal-Mart's decision last
fall to require its vendors to implement a
new technology called radio frequency
identification, or RFID, turned a lot of
heads.
RFID tags are expected to replace bar
coding, and they are more expensive and
contain more information, all within a speck
not much larger than a piece of dust. The
industry hopes the tags will improve
inventory control in the short-term. In the
long-term, the tags could end up on every
product we buy and might end up implanted on
ourselves.
''By Wal-Mart saying we're going to do this
in a year, they're forcing the industry to
come to some standard that now becomes
universal,'' said Paul Reed, owner of BRS,
which sells bar coding equipment in
Brentwood.
Big costs
Local Wal-Mart vendors are facing steep
costs to comply with the industry giant's
demands. Wal-Mart has said the top 100
vendors must comply by January 2005 and
everyone else by the end of 2006.
But some non-Wal-Mart vendors already have
begun to use RFID to improve on old
technologies.
Some privacy advocates fear the tags will
lead to a Big Brother universe, where
retailers, the government and even some
criminals clandestinely scan and retrieve
information about everyone they see.
The technology seems simple. A nanochip,
similar to a microchip, is imbedded in tags
or labels to identify individual products.
Antennas using radio frequencies can scan
those products, either in a hand-held device
or inside a wall or gate.
Some day, customers may be able to walk
through gates in grocery stores that
automatically scan their shopping carts and
deduct the charge from their credit cards.
For now most of the uses are on a smaller
scale.
Everyday uses
Used car sales company CarMax is using RFID
to keep track of cars that may leave its
lot. A company spokeswoman said the tags are
taken off when someone buys a car, so the
company doesn't keep tabs on customers when
they leave. The tags are for inventory
control and to deter theft.
FedEx Corp. uses the chips inside wristbands
of many delivery truck drivers, so they can
quickly unlock and lock the truck door
without fiddling with keys. The company is
testing wristbands that will start the
truck's ignition automatically. RFID also is
used at FedEx long-haul truck centers to
keep track of which trucks are on the lot.
ExxonMobil gasoline stations let customers
swipe a Speedpass through a reader.
Speedpass is a membership card that
automatically deducts the purchase from the
customer's checking account.
VF Imagewear is a Nashville-based subsidiary
of clothing giant VF Corp., which owns
Wrangler, Lee and a host of other brands.
VF Imagewear makes uniforms for everyone
from airline workers to state park
employees. They sell the uniforms, in some
cases, to laundries that in turn rent and
wash uniforms for places such as mechanic
shops, where the uniforms tend to get dirty
every day.
The Nashville-based manufacturer has been
embedding the chips in some uniforms, on the
request of the laundries. The laundries use
them to figure out which employee gets which
uniform back from the wash.
''The biggest advantage I see with RFID
chips is you don't have to see them with
your eyes,'' said VF Imagewear supply chain
business systems manager Janice Denton.
''You can wave a scanner near the chip and
without touching it you can identify it.''
Some tags can be read from about 3 feet
away. Others, equipped with batteries, can
be read from as much as 30 feet away,
according to Reed.
The practical benefits are apparent for
warehousing and shipping, Reed said.
''If you've got a tote going down a conveyor
belt, it could read all that as it goes
through a gateway,'' he said. ''It could
read several packages simultaneously.''
Making the switch
Murray Inc., whose
U.S.
headquarters is in Brentwood, makes lawn
mowers and other garden products sold in
Wal-Mart, Home Depot and other retailers.
It is preparing for a massive switch to
RFID, which could cost $1 million per year
in tags, according to director of logistics
Dwight Smith.
''Overall, from the technology and labor
standpoint, it's good,'' he said.
The company will be able to know what
inventory is in the warehouse and what is
leaving for trucks, without having to scan
each box.
Smith is hoping the price tag for the tags
will drop from about 75 cents or more, to
about 5 cents by the time
Murray
must implement the change. (Murray won't
confirm that the customer demanding the
change is Wal-Mart).
Reed said that, privately, company
executives are grumbling about Wal-Mart's
directive.
The low-end cost for a simple system is
about $100,000, he said.
And there is doubt the technology will be
ready for widespread use by the time
Wal-Mart wants it.
''The people I respect are saying it's
impossible,'' Reed said. ''They say
'Wal-Mart really is forcing standards in the
industry. The reality is that's not going to
happen.' ''
Technology run amok?
Vendors are not the only ones grumbling
about the technology.
Katherine Albrecht is the founder and
director of CASPIAN, or Consumers Against
Supermarket Privacy Invasion and Numbering.
''It's actually totally misleading to call
this an improved bar code,'' she said.
''This is a plan to uniquely number every
item on the face of the earth.''
Bar codes only identify what type of
product, such as Coca-Cola cans, is being
scanned. RFID tags will individually
identify each product.
Albrecht was a leader in the campaign to
boycott Benetton Group when the retailer
announced plans to imbed the radio chips in
a line of ''trendsetting'' clothing called
Sisley. The company has said no chips are
implanted in its clothing, but it is
studying the possibility.
She also has been fighting Gillette's
testing RFID chips in razor packages to keep
them in stock and track thieves. She thinks
Gillette has been using cameras to keep
track of who picks a razor package off the
shelf.
She fears that the technology will be used
to track people, for example when retailers
eventually know who has entered a store at
any given time and what products they likely
will buy. It will be possible to scan
people's homes and see what products they
have inside, she said.
And based on what people are wearing, the
government will be able to use hidden
scanners to track people.
Even Reed, who sells RFID technology, is a
little wary of it.
''I'm scared of this stuff, and I know about
it,'' he said.
The technology has not arrived to track
everyone with RFID chips, he said. And some
of the uses seem quite beneficial. The
government wants to use the technology to
track cattle from birth to death, to avoid
the spread of diseases such as mad cow.
Wristbands on the elderly in assisted-living
homes could alert caregivers if someone had
fallen or had a heart attack.
Others are researching RFID use in the blood
stream to track health indicators such as
blood cell count.
''It's all kind of futuristic right now,''
Reed said. |
