• by Seana Mulcahy , August 16, 2004

So I've got another acronym for you as I write on this rainy Monday. It's RFID. It stands for radio frequency identification. I believe it will be the next generation of wireless technology.

Imagine this: Your refrigerator tells you when you are about to run out of orange juice. Or how about knowing which gas pump is available so you don't have to wait in line.

Ironically, RFID is not a new technology at all. It was developed in the 70s. It uses the same waves used in radios to read information stored on small transponders called tags. Many think it will replace bar code technology as it eliminates line-of-sight reading. Information can be transmitted through boxes, books, etc. RFID tags can be used just about anywhere from pet tags to airplanes.

Last year retail giant Wal-Mart announced that it would be mandating supplies to switch over to this technology by 2005. Retailers from sporting stadiums have been exploring ways RFID can help traffic flow at concession stands. As a result, RFID has become a much talked about topic.

According to Computerworld, an RFID tag is a small radio frequency chip coupled to a microprocessor, which can communicate with an RFID reader. The tag has an ID that it broadcasts upon receiving a request wirelessly from a reader operating with the same frequency and protocol of the tag. If the tag has no battery -- called a passive tag -- it harnesses the RF power from the reader.

A tag may contain memory whose contents can be transmitted to the reader, and tags may be read/write or read-only. Tags can become sophisticated to the point that they can start to appear like Bluetooth or Wi-Fi chips, in which case they are powered and are typically specialized for some applications.

The automobile industry has already jumped on the bandwagon. I'm sure you must have seen someone open up their car while their car key is in their pocket. No they didn't click a button; it was RFID technology in action. Car manufacturers are starting to tag keys to prevent theft. When tagged, the proper code is searched. If it is not the right key used to start the car, the car will not start and the fuel gauge will be shut off.

The medical industry has begun to use the technology as well. Hospitals typically spend millions of dollars on tracking patients and medical devices such as defibrillators. I saw this in action a few weeks ago. A friend of mine had a baby. I went to the hospital to see the child the next day. On his umbilical cord he had this round plastic tag. It was to track his identity. Appropriately placed, it did not hurt the baby and would fall off naturally by the time he went home.

While the technology is amazing, you can see where people would be up in arms regarding privacy issues. RFID uses a numbering approach called electronic product code (EPC). EPC allows for a unique number to be assigned to just about every product or human. Therefore, anything from toothpaste to babies to pallets of soda can be tracked.

Activists are afraid this information will be misused and track behavior of individuals. This would enable manufacturers or stores to produce a "file" on an individual. If a product is tagged, we need to ask when it shuts off. Or is there a way to shut off the tag once the consumer leaves the store.

As Internet advertisers, researchers, and technologists, we need to think ahead. If just about anything physical can be tracked, how do we link this to our online efforts? This may be the link between online and offline that we have been looking for. If we could find a way to say link an online advertising campaign for say a new low carb soda to actual sales, we'd be doing the happy dance. Sure some of us are doing this now. However, let's face it, we use fuzzy math.

I'll leave you with a couple things to think about. Would you consider tagging your pet in case good old Rover ran away? How about your car? Or maybe your baby? I'd love to get your take on this as well as how we could use this in our business in the short term future. Post to me on the SPINboard.