LOS ANGELES — Nearly unknown a decade ago, a device the size of a pencil tip is beginning to infiltrate every corner and pocket of American life, according to a report in the Christian Science Monitor on December 20. This recent technology — called RFID for "radio frequency identification" — is making everything from warehouse inventory to vehicle location easier, faster, and more informed. Some examples of RFID uses that have proliferated in just the past several years: At the same time, the rush to harness the technology is raising a host of regulatory and other concerns, including the invasion of privacy, personal freedom, and civil rights. Those issues in turn are generating concern by lawmakers for how access to data collected by such methods should be limited and protected. "Five years ago, no one was talking about RFIDs and the issues they raise for public policy, consumer, and citizen protection," says Lisa Sotto, who analyzes the industry for Hunton and Williams. "Now the national discussion is just starting as both the states and federal government realize that the current lack of overall framework for regulating the collection of [this] data is untenable." Opponents of RFIDs worry that widespread use of the tags could lead to all kinds of misuse. Besides the gathering – and perhaps selling – of biographical and logistical data, unknown by unsuspecting consumers, companies could track consumers who buy their products to find how often the products are used and where. "We have not even gotten close to the big picture on what will be the good side and the bad side of this burgeoning technology," says Jeff Wacker, a futurist at Electronics Data Systems who consults with businesses and consumers about the prospects of RFIDs. "For now the only thing that is clear is that this is a genie that is out of the bottle, a juggernaut whose use is only going to get bigger." Public furor has already erupted several times, generating organized opposition against two companies in 2003 (Benetton and Gillette), which led to cancellation of limited-use plans. And the use of EZpass toll data has been subpoenaed for divorce courts, hoping to establish the true whereabouts of errant husbands and wives. "Almost no one is talking about it publicly, but every day all over the country toll pass information is being used by lawyers in divorce cases," says Fred Cate, director for Applied Cybersecurity Research Indiana University. "What is scaring a lot of people is they feel that as soon as each new idea for the technology exists, it's only seconds before the government will have it." While much concern is being raised about regulating the growing use of RFIDs, there are many who see the technology as a greater benefit than infringement on daily life. "The great side of all this is there will be plenty of ways in which RFIDs will be a win/win for both companies and consumers as companies continue to figure out more ways to enrich lives," says Alan Chapell, who runs a New York-based consulting firm on consumer privacy and marketing. California is considering the use of RFIDs to help eliminate gas taxes by instead tracking and taxing commuters on the number of miles they drive. "The people who created the highways of America have always wanted to pay for them by charging a mileage tax but taxed gasoline instead because there was no way to track mileage economically," says Martin Wachs, a transportation specialist at UC Berkeley. "Now the advancing ability of RFIDs and their dropping cost has changed all that. There are trade-offs with privacy issues but it is an idea worth taking very seriously." For now, however, experts in privacy law and marketing analysts say more education and debate is needed. And crucial to that debate, they say, are whether users know they are being tagged, whether they have a choice, and who benefits.

Originally posted on Fleet Financials