RFID: Are We Ready For It?

Whenever a new technology is developed, two things invariably happen over a
period of time. The cost of the technology, which is high to start with, falls
to a sustainable level. Second, as people understand the technology better,
innovative applications get developed. Few are hailed as the greatest
innovations and others attract criticism, while some gather protests from
activists!

Much has been written about the RFID technology and much more remains to be
written. One can write a 500-page book on the subject, and by the time it is
published; there will be so much more information available that a second volume
can be written about it!

Even though RFID is a self-explanatory term, let's take a quick look at it
again. RFID stands for radio frequency identification. But that's the end of
it!

The new devices are no longer just plain RFID devices. They are miniature
data storage devices, which can be either 'Read Only' or 'Read/Write'.
When you interrogate them, they give out all the data that is stored inside.
Some advanced devices can even respond to your interrogating signal
intelligently.

Looking at the Indian scene, the general opinion is that we are not ready for
the RFID wave yet. Take a look at it from a

different perspective. Ready or not, some of us will be forced to go for RFID
compliance.

When Wal-Mart comes to you with an order for 10 million HDDs, you don't
send them away because you are not yet ready for RFID! We must make a
differentiation here. We have to be ready for RFID if we want to be a global
player.

We have to be ready for RFID labels and Smart Packaging. As far as utilizing
the technology in the operations is concerned, we will not be ready for it till
the prices of RFID labels compare with the Bar Code labels.

DERIVING BENEFITS FROM RFID

Companies that will go for the RFID technology only for the sake of
compliance with the customer's tagging requirements and make no other use of
it, will not derive the benefits of the technology. They can actually use it to
improve inventory, warehousing, distribution, logistics and security. The same
tags and systems used to satisfy customer requirements could also be used to
improve their own internal operations.

Some manufacturers were even reluctant to use bar code labeling when it was
first introduced. Today, however, these manufacturers wouldn't think of
operating without bar codes because of the efficiency they provide.

PLAYING THE TAG GAME

A changeover to RFID tagging will replace the existing UPC codes with the
new Electronic Product Code (ePC). The ePC number can be embedded within the
RFID tag or label that can be applied to each item produced by a manufacture.

The ePC code allows retailers to track products at the SKU (stock keeping
unit) level by providing every product with a unique identifier. It is made up
of two key components: a number, which identifies the manufacturer of the
product; and a number, which identifies the product belonging to that
manufacturer.

The ePC is a new product numbering standard that goes way beyond identifying
products. It assigns a unique number to every single item that is produced by a
manufacture. With this system, every single bottle of ketchup would have its own
unique ePC number. The ePC will allow products to be tracked at the item level.

Because of the near infinite quantity of unique numbers required to track at
the item level, the ePC utilizes a '96-bit' numbering scheme.

GET SMART

The RFID technology does not stop only at applying electronically readable
code numbers to items. Smart tags and packaging are already being used in
healthcare, medicine, food and other areas to save lives by preventing errors,
keeping track of expiry dates, tracking changes in storage temperatures and
other conditions of medicines and food in transit and in storage.

Smart labels on food, vaccines, blood etc. can detect overheating, presence
of specific bacteria and viruses and other defects. Smart RFID technology
combined with sensor technology is capable of tracking over 20 different
parameters. It can prevent fatal counterfeiting and product diversion.

RFID tags can automatically prevent a wrong dose being delivered. An
electronic handshake can be used to ensure that single use items cannot be used
twice.

WAITING FOR THE PRICE FALL

All these technologies are still costly, but the prices will come down as
the deployment see an increase. Where the cost of using RFID is effective,
businesses in India are already using such tags even though they are very
primitive.

Retailers are using RFID tags on a large scale to prevent shop-lifting. These
tags are nothing but devices that are capable of giving 'One bit' of
information, when they are interrogated! As in the computer systems everything
works with a series of ´bits' that can take on the value of 1 or 0.

The RFID interrogators at the exit gate of a retail store detect the presence
(1) or absence (0) of the tag on the product that you are taking out and decide
if you are a shop-lifter or you have paid for the products.

Going to the other extreme, we can make a bold statement that millions of
Indians are already carrying quite expensive RFID devices with them! Your mobile
phone is an RFID device in disguise. It has a unique identification number which
points to your profile in the service provider's database. It responds with a
ring when called (Interrogated) and it can disclose your rough whereabouts when
it responds to a call. The interrogation in this case need not always be in form
of a call, it can be silently interrogated without ringing.

PRIVACY, ENTER WITH CARE

This brings us to the hot issue of consumer privacy. Activists are already
protesting about the possibility of RFID misuse. They consider the RFID chips to
be spy chips.

Solution providers, who are thinking about RFID solutions, must also be aware
of ethical implications of the RFID technology. Fire can be used for cooking a
delicious meal, as well as for burning someone's house, RFID can be used for
the benefit of society and industry as well as for tracking your whereabouts,
buying habits, spending patterns etc.

An RFID chip in the dog collar is a good tool to keep track of your dog, but
the same RFID chip used in a national ID card by a government to track its
citizens will raise a storm. With such technologies, the advantages are always
very high compared to the possibilities of misuse. But it is very important to
be aware of and alert about such issues.

Ashok Dongre is an independent
consultant