Saturday, June 25, 2005

Tiny tags on goods could track shoppers

Concerns about potential abuse of personal information have led Canada's privacy watchdog to launch a study of tiny tracking tags turning up in everything from clothing to key chains.

Privacy Commissioner Jennifer Stoddart is looking at the use of radio frequency identification tags, or RFIDs, by stores and other enterprises.

Each tag contains a miniature antenna that beams a unique ID code to an electronic reader. The data can be transferred by the reader into a computerized database.

Small enough to be embedded in the lining of a sweater or the back of a book, the devices help companies efficiently track inventory.

But privacy advocates fear RFIDs could also be used to monitor consumers' buying habits or even their movements.

"We've been tracking the deployment of RFIDs for a couple of months now," Stoddart said. "We're trying to get a portrait of how fast RFIDs are being used in Canada in retail sectors and by whom."

Just 14 per cent of businesses surveyed last year by consulting firm Deloitte said they were using RFID technology. Almost half indicated a strong likelihood of doing so.

Deloitte said the most common planned use was in stockpiling and unloading of goods at distribution centres.

Stoddart wants to ensure "appropriate safeguards" are in place if Canadian companies begin using the devices to build customer profiles.

Ontario Privacy Commissioner Ann Cavoukian also flagged the issue in her annual report this week.

"When RFID technology finds its way into consumer goods, privacy concerns can quickly escalate," she wrote.

For instance, she said, an RFID tag on a product could be linked to the purchaser at the time of sale if the person used a credit or loyalty card.

Such data linkage could help develop a consumer profile of a shopper who bought a tag-bearing sweater using a loyalty card and later used the same card at a hardware store.


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