RFID fits within a wide range of wireless technologies that allow for the “Internet of Things”, but in itself it also harbours different solutions that differ with regard to reading range and frequency used. Specific applications determine what kind of data will be needed, at what range the tags should be scanned, how the data will be protected and whether there are any concerns like privacy, interoperability and spectrum interference.

RFID is not limited to one specific application, nor is it defined by one specific technology. Although this may seem obvious, the failure to understand that there are different uses will blur any discussion concerning the deployment of RFID. RFID technology is a tool, an enabler of functionalities; it is not a goal in itself. In discussing RFID, there should be a distinction in functionality, field or sector of deployment, and the main user of the technology (business, consumer, government). For some sectors, low-tech solutions would possibly suffice (e.g., 2-dimensional (2D) barcodes on pharmaceutical goods).

Each application of RFID can be analysed regarding their level of “sensitivity” (sensitivity is determined by: (1) how big would the damage be in case of mistakes or abuse in the use of RFID data for the specific application; and (2) how easy is it for things to go wrong through abuse or system failures for the specific application). This is a starting point for an analysis of the need for specific policy action, based on a number of distinguishing factors. The European Commission may engage in an analysis of vulnerabilities of different applications, functionalities and fields. From a policy point of view, the main distinguishing factors that would determine the level of “sensitivity” are:

• Closed versus open (networked) systems: is RFID used within a confined environment or closed user group; does it stop at a locally un-networked PC? Or is it linked to a public network? Can and will an RFID tag be switched off after a certain step in the value chain?
  
• Identifying a person versus identifying a good or service: does the RFID signal the presence of an identifiable person? This can imply a tag fitted to a person or a person’s belongings (carried outside the confinement of the person’s home), but may also include the traceability of cars and other vehicles.

Thus a matrix emerges, in which one corner represents the less sensitive uses of closed-network identifiable goods, versus open-network identifiable people. Generally speaking, a closed system that does not use RFID tags linkable to a single person may raise concerns. On the other hand, a system in which item-level tagging reaches the consumer, may require more attention. There is strong evidence that RFID-enabled processes can lead to time saving, efficiency, and support personalisation: advantages that can pass on to consumers. Following the logic of the workshop, a brief overview of advantages and issues for different application areas is given below:

• For supply-chain management, RFID has the potential to link the physical world closer to the digital world, which could greatly improve transparency, enhance control of supplies, reduce inefficient ordering, and avoid out-of-stocks situations and phantom inventory. Furthermore, it can be used in preventing losses through theft and counterfeiting luxury goods or pharmaceuticals. RFID’s benefits can be reaped to their fullest when all organisations in the supply chain can use the same technology end-to-end, but also implementation along (closed) parts of the supply chain have shown to be successful. At the same time, the more open systems are the more issues of interoperability and non-harmonised frequency bands come into play. From an economic point of view, a fully digital supply chain could become feasible in the next decade if the cost of tagging would drop even further. Yet, one speaker made the statement that it may be difficult to show the added value of implementing RFID as many operations are already optimised and investments may outweigh benefits. However, other presenters made the observation that continued emphasis by large market players could provide a more compelling reason to support the technology and trigger mass adoption. Also, the question whether box- or item-level tagging would lead to privacy issues (identification) at the consumer side should be resolved; however, any solution should be balanced with the fact that consumers can also derive value from using RFID.
  
  
• In transport, RFID will enable dynamic monitoring and self-organised micro-devices. RFID allows automated scans at different points, allowing for continuous data collection, which leads to: 1) better information on the origins, location, and destination of goods, as well as 2) speed in handling. Also, RFID tags can be re-written and allow for decentralised storage of the most pertinent data on the item tagged. The technology can be introduced for purposes such as quality monitoring (sensing the temperature of perishable goods), asset management, fleet management, and tracking and tracing of containers (e.g., sealing containers with an RFID seal and in the future ‘smart containers’ that can co-ordinate their own transport). On roads, RFID can help identify cars (an electronic number plate), reduce car theft, enhance road safety and automate the collection of road tax. Public transport is another area where RFID-enabled smart cards could allow for easy intermodal transfer and cashless payment. However, speakers mentioned that a precondition for a pervasive deployment of RFID is that chips become cheaper, which may be achieved by research in materials and printing techniques. Also in this field of application, standards and interoperability can be problematic, as multiple (public) transport providers need to cooperate and adhere to the same standards – it becomes even more difficult when international parties are involved. When looking for solutions in this field, it is crucial to involve all relevant stakeholders; e.g., in international trade, Customs Departments are an important player, as many of the delays at the border occur when the right information on the shipments is not available. The interception of counterfeit goods also often takes place at Customs.
  
  
• For government use, RFID would offer applications to the benefit of both government and citizens, including combating forgery of official documents (passports, declarations and banknotes) and enhanced services for citizens. One of the promising prospects of deploying RFID in the public sector (in a “closed” setting) is workflow optimisation (easier retrieval of official documents) and the collection of statistical information to increase the processes’ transparency. Deploying RFID in more open settings could make some jobs, such as the tracking of stolen goods by the police and customs control, easier and more reliable. In addition, RFID can be instrumental in monitoring and controlling administrative processes. Clearly an active role by governments is required in this field: the European Commission could stimulate national governments to act as a launching customer, also involving small- and medium-sized enterprises (SMEs) in their procurement efforts. Privacy-enhancing technologies (PETs) are mentioned as an important element in this application area to ensure privacy that is inherently connected to official (personal) documents.
  
  
• In healthcare, the use of RFID technology to enhance patient safety and assisted living should be further explored. One speaker made the remark that three times more patients die due to avoidable mistakes than in car accidents every year in Europe. So far, only rudimentary applications have been tested, since testing integrated applications is difficult. Performing pilots to assess the effectiveness and feasibility of RFID in hospitals could be perceived as an important option to reduce the number of avoidable mistakes. Potential areas of success are: tracking and tracing of patients; patient prescription compliance and reducing medication errors; reducing medical errors by linking electronic patient dossiers to tags; retrieving chirurgical equipment; and blood (quality) tracking. Although the complexities of introducing RFID in the hospital setting itself are already large, involving extramural health carers increases complexity. It should be noted that RFID is not always perceived as the best solution: in the supply chain for pharmaceuticals, the 2-dimensional (2D) data matrix[1] seemed to be considered at the moment a more cost effective solution with less deployment barriers and a similar level of enhanced safety. Yet, as speakers highlighted, this solution also requires prior harmonisation of labelling standards throughout Europe. The ERP (enterprise resource planning) systems that are put in place to handle 2D matrix information could at a later stage be adapted to handle RFID as well.
  
  
• The use of RFID in modern mobile life (e.g., coupling a payment function to mobile phones and other personal assistive devices) is already common practice in Japan. Tracking mobile assets and people (e.g., automatically transferring your phone to the office or meeting room you are in, monitoring visitors, monitoring the location of documents, etc.) applications are no longer science fiction. RFID may be used to retrieve product details of tagged goods or street posters. Combining RFID, mobile and location technologies make many more innovative services feasible, such as tourist information on demand, location based promotional offers, and guidance of poor-sighted citizens. Connecting tags to people should be used only for those applications where the persons affected agree that the perceived advantages of using RFID tags outweigh the perceived disadvantages.

Policy challenges raised at the workshop

In the workshop, developers and early adopters of RFID warned against regulation that may hamper further uptake, as many of these applications are still in the early stages of development. Many speakers argued that at this stage of RFID development, self-regulatory programmes and guidance should be encouraged. It was suggested that the European Commission should monitor the deployment and range of uses of RFID. The positions expressed can be summarised as follows:

Regarding consumers

One thing seems clear: when RFID reaches consumers, consumers want the right to choose. They want to know how RFID may affect their convenience and security but also privacy. For instance, consumers want to know whether RFID tags on certain goods will still be readable after they are handed over (e.g., at cash register). When a consumer leaves a store, tags could be either deactivated or in privacy mode; it was suggested that more solutions should be developed that leave the consumer in control (e.g., reducing the range of tags by breaking the antenna, or portals that allow the customer to switch off the RFID functions). Apart from this area of research and development, also other system parameters (reading distances, encryption, shielding) need to be investigated.

Consumer representatives stated that much unease stems from the fact that RFID tags are small and that the process of accessing the tags cannot be physically checked. In order to increase transparency, the technology should be explained, and made understandable to consumers. Workshop participants suggested to make use of pictograms, and not to focus on details. Information would have to be easy, understandable, and targeted to the needs of consumers.

Self-regulation and guidelines may be needed to implement and clarify the existing framework for privacy and security. Whether further legislative steps (i.e. beyond currently existing legislation) are necessary, would be a matter of further experience with RFID use and debate with stakeholders on their needs and concerns. The role of the European Commission should be explored. For instance, the European Commission could be instrumental in proposing guidelines for informing consumers.

Regarding governments

If RFID is to develop beyond its current use, a more active approach to building interoperable systems could be useful. The European Commission and the European Union (EU) Member States could support such an approach. As an example, the Australian government’s recent announcement of a 1.1bn A$ smart card plan to replace 17 applications is mentioned. Such examples would show that Government can act as a stimulator and support the emergence of new applications, while not discriminating in favour of specific technology solutions.

Participants indicated that the European Commission could usefully support further development in specific fields through the instruments available to the European Commission. Taking into consideration the focal points of the i2010 initiative (single European information space, innovation and investment in ICT, inclusive European Information Society), the first two could be addressed broadly, but specific solutions may be found in the area of inclusion (e.g., support for visually impaired) and in the area of quality of life/healthcare (e.g., medical error reduction, assisted living).

According to some, when connected to identity management, RFID technology should be closely linked to and may work as a catalyst of a European electronic identity policy, which is considered one of the enablers of the recent eGovernment Action Plan.

Regarding SMEs and businesses

According to participants, one of the instruments governments can deploy is the stimulation of awareness on opportunities and challenges related to RFID deployment, and knowledge transfer. Without a focal point for exchanging plans and experiences, chances are that the wheel will be reinvented in several Member States and that the different solutions developed would not be interoperable. Knowledge sharing could take place in a multi-stakeholder platform or partnership. The Dutch RFID Platform and the German Informationsforum RFID, as well as the German Chambers of Commerce, are possible examples of such arrangements: emergence of such platforms on trans-national level could be useful.

This would not diminish the joint responsibility of retailer and manufacturer to correctly inform audience about the presence of tags. It would be important that the public is well informed: just putting a label (that nobody recognises) on a product would not do. There would be a need for a uniform label indicating RFID presence.

In summary

RFID can lead to efficiency savings and other added value services in a range of application areas. There are also concerns, such as privacy, health, interoperability and standards. However, these cannot be generally addressed for RFID technology as a whole; they should be focused specifically at the application in which RFID technologies are used. A matrix in which open/networked systems versus closed systems are set out against personal identification versus goods identification may be a way of distinguishing ‘sensitive’ RFID uses from less sensitive ones.

Many of the participants in the workshop suggest that, as it is still early days of the wider deployment of RFID, the European Commission should take a regulatory light approach in which self-regulation, together with guidance where appropriate, could be a possible way forward. Monitoring the development of RFID technology is important to recognise both challenges and opportunities in this early phase, and to act with specific policy measures when necessary. One thing seems clear from the workshop: consumers demand the right to know, and the right to choose. Clear and comprehensive information on products is important in this regard, as well as development of solutions that allow the consumer to be in control of the RFID.

[1] Essentially, a 2D matrix is like a barcode, but made out of dots on a grid – thus more information can be stored.