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Why swipe a card when you can wave?: Two local companies among those hoping to cash in on potential of radio frequency ID systems. [The Morning Call, Allentown, Pa.]
[August 01, 2010]

Why swipe a card when you can wave?: Two local companies among those hoping to cash in on potential of radio frequency ID systems. [The Morning Call, Allentown, Pa.]

(Morning Call (Allentown, PA) Via Acquire Media NewsEdge) Aug. 01--When young guests at Great Wolf Lodge in the Poconos emerge from one of the resort's many water slides feeling a little hungry, they often wander over to the resort's snack bar.

No need to worry about fishing soggy dollar bills out of their swimsuits, though. They just hold up their water park wristbands and a radio frequency identification reader at the counter sends a signal to a tiny embedded tag, which sends a signal back to the reader, which charges the purchase to their room.

The technology has been around for nearly a decade, but Walmart's announcement in late July that it plans to start adding RFID tags to men's jeans and other clothing items in its vast network of retail stores served notice that its use is expanding far beyond pilots like Great Wolf Lodge.

It's a prospect that excites the leaders of two local companies that are hoping to cash in on that expansion with the backing of the nonprofit Ben Franklin Technology Partners of Northeastern Pa. in Bethlehem, but concerns privacy advocates who worry it could put personal information at risk..

"This stuff is going to be everywhere," said Ken Horton, CEO of RCD Technology in Quakertown, which makes RFID tags and their components. "There is stuff nobody has even thought of where this [technology] is going to be applied." What is RFID? Imagine a programmable bar code that doesn't have to be scanned, but broadcasts its product or personal information when activated by radio waves from a reader or "interrogator." Versions of the technology are used in EZPass toll transponders and the anti-theft tags that set off alarms when someone neglects to pay for an item of clothing.

It's also in point-to-pay credit cards, such as Visa payWave. Some hospitals are using the technology to track patients as they move from room to room, and corporations are using RFID tags to keep track of expensive equipment like laptops.

Horton's company, which has received $434,000 in support from Ben Franklin, produces an RFID tag that is embedded in new national Passport ID cards, which facilitate travel over the Canadian and Mexican borders.

Passport holders don't have to hand their passports to a border crossing guard. Travelers hold up their cards and a reader receives ID numbers that call up each passenger's personal information and photo from a secure passport database. It streamlines border crossings.

The technology differs from global positioning because RFID tags generally can only be read from short distances, a matter of feet. Install a reader in a doorway, for example, and it will record what tagged items -- or people -- have left or entered the room.

Shoppers eventually could roll a cart of items up to a checkout line and an RFID reader would instantly take inventory of the basket without requiring the items to be removed from the cart. A bar code has to be swiped over a reader, while an RFID tag simply has to be within a few feet.

In the United States, the technology primarily has been used in inventory control, with RFID chips attached to pallets or shipping containers to automatically track merchandise from the factory to the distribution center to the retail outlet.

Walmart's announcement suggests the technology is making its way into the consumer marketplace, but before it becomes as ubiquitous as the bar code, companies will have to decide it will benefit their bottom line, said Paul Prince, executive editor of RFID Journal.

"It is definitely a good thing for the industry," said Jack Romaine, CEO of Element ID Inc., a Bethlehem company that makes RFID readers. "Any time you get someone as important and large as Walmart to adopt a technology, it ripples through the whole industry." Privacy concerns For all its fans, the technology also has critics who say it could be abused to violate customers' privacy and put their personal information at risk.

Several states have passed legislation prohibiting RFID chips from being involuntarily implanted in people. The Pennsylvania House of Representatives passed a similar ban last year, but it is stalled in the Senate.

After the Food and Drug Administration gave preliminary approval to an implantable RFID chip in 2005, some conspiracy theorists even equated the technology to the biblical mark of the beast. The implantable chips, similar to those that can be surgically inserted into pets to help identify them if they are lost, had very limited use and are not currently being marketed.

The American Civil Liberties Union's concerns are more practical, said Andy Hoover, legislative director for the group's Pennsylvania chapter.

The group is particularly troubled by efforts to include RFID tags on government-issued driver's licenses, for example. If not adequately protected, a cardholder's personal information could be read by anyone with a reader who passes within a few feet.

"You are walking into potential pitfalls when it comes to privacy," Hoover said. "People are amazing with their skill and ability to hack into databases. Any time there is massive amounts of information gathered anywhere or your personal information gathered anywhere, we want to make sure there are barriers in place to protect it." Great Wolf Resorts rolled out RFID technology when it opened Great Wolf Lodge in the Poconos in 2005, company spokesman Steve Shattuck said. It has since expanded the technology to four other U.S. resorts. The goal is customer convenience.

The tags are imbedded in the wristbands that give guests access to Great Wolf's water park. They are used instead of card-keys to open guests' hotel room doors and to pay for purchases in the resort's restaurants and retail stores.

Parents can even load children's wristbands with a programmed allowance of spending money.

At one of its Texas resorts, the company has tried linking customers' wristbands to the cameras that take pictures of riders on several of its most popular water rides. At any time, guests can stop at a kiosk and flash their wristbands to see what pictures have been taken of them and if they like one of the images, order copies, or have it emblazoned on a T-shirt or mug, for a fee.

"It is very recent continues to evolve," Shattuck said.

Tracking technology RFID chips can be programmed with information about the person or item they are attached to, or simply an ID number linked to that information in a secure computer database.

Health care offers a growing market for RFID technology, said Romaine of Element ID Inc., whose company, which has received $350,000 in support from Ben Franklin, makes "plug-and-play" RFID reader systems.

The Department of Veterans Affairs is using one of Element ID's systems in a pilot project to keep track of patients at a VA nursing home, he said.

"We just did a demonstration for a hospital customer that wants to put our technology at portals," Romaine said. "They want to keep nursing home patients from walking outside." Lehigh Valley Hospital uses a RFID-like system that uses inaudible sound waves rather than radio waves to keep track of patients in its 22 operating suites. Badges attached to patients' wristbands transmit signals that are picked up by sensors in the pre-operating room, operating room and recovery room.

With a glance at a flat screen monitor, nurses and doctors in the unit can see which patient is where, down to the individual recovery room bay. In the operating room, patients' tag bring up their medical records on a computer screen, and nurses update surgery status.

Eventually, patients may be able to check on the progress of loved ones' surgeries, an option already offered by some other health systems, said Brian Leader, Lehigh Valley's vice president for peri-operative services.

"There are companies out there who offer a whole hospital solution, not only for patient tracking, but equipment tracking," Leader said. "So we would know where the wheelchairs are or infusion machines are." Despite Walmart's move to place the tags on clothing, it will probably be a while before every "can of beans" in the supermarket has an RFID tag on it, Horton said.

The problem: The tags still cost a few cents each, while bar codes add barely a fraction of a cent to the cost of items that already have printed labels. A seven-cent RFID tag makes little difference on a $2,000 flat-screen TV, but is more significant on an inexpensive food item.

"I don't see a can of beans getting there for a while," Horton said.

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