That same ability raises the specter of nightmarish Orwellian scenarios in which consumer purchasing behavior is captured in databases that are manipulated by corporations and government as a tool for spying.
RFID utilizes a tag containing a computer chip that stores data relating to the tagged item, such as color, size, brand, warranty information, etc. Tags can also be affixed to pallets and cartons to identify contents of shipments during the distribution process. An antenna in the tag transmits and receives data through radio waves, which are picked up by a reader (Carlson 2006). In one type of RFID system known as passive, a signal is sent out by the reader creating a magnetic field, which is broadcast by its antenna to create a sensitive detection zone. When a RFID tag enters this zone it picks up the reader's signals, which turn on the microchip's transmitter, thus informing the reader of its presence. Passive RFID is a short range system in which the reader must range from one inch to a few feet from the tag in order to engage a signal (Kasavana 2006).
Another type of RFID technology is known as active. This is a longer range system because both the tag and reader have power supply units and are capable of sending and receiving signals. The transmission range may be up to one hundred feet due to this mutual transmission. The data on active RFID microchips can also be rewritten (Kasavana 2006). Active tags are far more expensive than passive tags (up to $40 as compared to 15 cents for passive tags) and are therefore less attractive and appropriate in a commercial retail environment (Carlson 2006). Nevertheless, given their long range scanning potential, active RFID has a broader range of potential applications. It also drives greater concerns regarding potential abuse.
RFID is considered to be more effective at inventory tracking than traditional bar codes for several reasons. First, it is capable of scanning a large volume of items nearly simultaneously, whereas bar codes are only capable of scanning items individually. Second, items being tracked with RFID do not need to be within the scanner's line of sight, while those being tracked by bar code must be visually perceptible. Finally, bar codes must be clean and intact in order to be read, making it difficult to register products that may be soiled or mutilated. This is not an issue for RFID so long as the tag has not been removed or destroyed (Pethokoukis 2005). Further, the accuracy of RFID readers has improved dramatically over time. Boeing recently noted a 99.8% accuracy rate on its application of RFID, with a failure to ready 21 of over 18,000 tags (Mallozzi 2005). Given these advantages over traditional tracking approaches, it is clear to see why the technology is so attractive.
That being said, there certainly are some difficult challenges faced by companies seeking to take advantage of RFID. "To realize benefits from RFID, companies must change their processes. If technology goes without changing processes or integrating the data into [the] existing system then the company won't reap the benefits from RFID" (Affirming RFID Realities 2006). Additional challenges exist in designing systems to manage false read rates, and finding "ways to manage and use the mounds of data that will come from RFID tags." Moreover, there are practical difficulties for manufacturers seeking to embed RFID in products