How Spy Chips Are Quietly Reshaping PrivacyBy Martin H. Bosworth
ConsumerAffairs.Com
You may not realize it, but that pack of disposable razors you just bought can enable you to be tracked wherever you go. Same with that discount card you used to buy the razors in the first place.
Somewhere, a computer is collating and tabulating all of your information from the moment you step into the store, and using it to generate a "profile" of you for unknown purposes.
Not only that, but one day in the near future, you could have a little microchip implanted in your body. Like something out of "Blade Runner" or "The Matrix," you could be electronically "tagged" and identified in order to build a record of your medical information, accessible anywhere in the world -- and for other purposes you may not know about.
Sound like cyberpunk at its most cliché? Far from it. Radio frequency identifiers (RFID) -- more commonly known as "spy chips" -- are a reality in everything from retail business to medical records.
And that's just the beginning. In the words of Alex Eckelberry, president of Florida-based Sunbelt Software, "The problem with RFIDÂ…[is that] we are headed toward a state where privacy will be a thing of the past."
Brave New World
RFID works on a deceptively simple principle. An object is implanted or "tagged" with a small computer chip. The chip is monitored wirelessly by a "reader" that identifies its unique signature, and whatever information is on the chip is automatically stored in a linked database.
What makes this different from classic "bar codes" is that the data storage capacity for RFID enables each and every tagged item to have its own unique identifier, whereas the bar code system has one code for an entire class of item.
Business was quick to jump on the concept of millions of products that could be individually identified and tracked. Wal-Mart has led the way in using RFID tagging, investing $250 million in RFID technology and requiring their distributors to mark high-end items such as consumer electronics with RFID tags.
Walgreens recently partnered with marketer Goliath Solutions to track promotional displays in its 5,000 stores nationwide using RFID tags. The tags will be used to track how long displays are made available in stores, group displays by regional interest, and so on.
"With the GOLIATH system, we'll have unprecedented insight into marketing data collected daily from every store," said Robert Kral, Walgreens vice president of purchasing in a press statement.
RFID tags are used in the EZ Pass toll-charge system popular throughout the Northeast. EZ Pass users prepay a certain amount and install a transponder in their car.
When passing through tolls that use the EZ Pass system, a reader in the toll booth identifies the transponder and automatically deducts the amount of the toll from the driver's account.
The government is also getting in on the RFID action. The Department of Homeland Security (DHS) is testing the use of RFID-tagged cards for visitors to and from the United States. Border guards would "read" the cards each time a visitor to the U.S. crossed the divide.
The Defense Department has issued several big-ticket contracts to RFID suppliers in order to tag their shipments of food, clothes, and weapons around the world.
Investment in RFID is booming. A study by the Gartner research group found that worldwide spending on the technology was $504 million in 2005, with total spending expected to increase to $3 billion by 2010.
"Businesses are beginning to discover business value in places where they cannot use bar coding, which will be the force that moves RFID forward," Gartner's vice-president of research, Jeff Woods, said.
The Body Electric
The most controversial aspect of RFID technology usage is the concept of installing RFID tags in living beings, humans and animals alike. A rabies scare in the Bordeaux region of France in September 2004 motivated the Digital Angel Corporation to distribute 50,000 of its RFID tags to implant in pets in the region.
A year later, Digital Angel supplied 2,000 chips and 28 readers to identify pets displaced by Hurricane Katrina, both to read chips that had already been implanted in pets, and to create a database of information about the animals in order to identify them.
Digital Angel is a subsidiary of Applied Digital, Inc., a company that specializes in "information and security solutions." Another Applied Digital subsidiary, VeriChip, has championed the usage of implanting RFID tags in humans for medical database tracking.
VeriChip's "VeriMed" tracking solution would enable doctors to identify medical patients who may be unable to provide proof of who they are or who can't communicate effectively. The patient would have an RFID chip implanted on their body, which the physician could then track with a handheld reader.
The patient's medical information would be stored, according to VeriChip, "[in] a designated secure healthcare information database, allowing [the physician] to immediately take the safest course of action."
VeriChip has currently deployed the VeriMed system in 68 medical facilities, including 65 hospitals.
Applied Digital is taking advantage of recent publicity about RFID to file an initial public offering for VeriChip, scheduled to close in late 2006.
According to the press release announcing the IPO, "Offering proceeds will also be used for enhancing the growing sales of the infant protection systems, wander prevention systems and asset tracking systems both in the United States and internationally."
VeriChip got a huge publicity boost from the support of former Department of Health and Human Services (HHS) chairman Tommy Thompson. Thompson serves on the board of directors of VeriChip, and publicly exhorted the virtues of using RFID for medical information tracking.
In an interview with CBS MarketWatch, Thompson compared the technology's growing usage to that of the iPod.
"Today everybody knows what an iPod is," said Thompson, "and the same thing as with a chip in your arm that is placed there instantaneously, and is going to be able to help you secure your medical records which will be able to allow you toÂ…be able to get immediate care."
Thompson also said that he himself would be willing to get "chipped" in order to demonstrate how quick and easy the procedure is. However, when asked about it on December 5th, VeriChip spokesman John Procter said that Thompson had yet to undergo the procedure.
According to Procter, The procedure is "very quick and painless," but Thompson has to fit it into his schedule. In an interview with ConsumerAffairs.Com, Procter said that "it will be handled in an appropriate fashion."
Procter emphasized that all uses of the chip are "completely voluntary." "We will not have [the chip] imposed on people who don't want it." The best uses for the chip would be for patients who may be mentally ill or have prior conditions that require constant care, he said.
Legal guardians of patients who may be unable to communicate their desires may have the authority to "chip" someone without their permission. The data would be stored in a "secured, password-protected, firewalled database" maintained by Applied Digital, except in cases where hospitals maintained their own databases.
Although Procter stressed that the database would meet conditions required by the Privacy Act and the Health Insurance Portability and Accountability Act (HIPAA), which governs the collection and protection of medical records, he could not verify if the administrators would themselves be HIPAA-certified.