2006: A year of risk and opportunity for RFID (Radio Frequency Identification)
Although RFID and related technologies have been around for decades, new innovations, lower costs, and decisions by key federal government agencies have made RFID an emerging growth technology for both the private and public sectors. The rapid growth and increasing visibility of RFID has also attracted the attention of state and federal policy makers - not unlike the increased focus on Internet governance in the mid-1990's.
At least 12 state legislatures have bills pending restricting and/or regulating the use of RFID technology. The legislative has often been triggered by well-meaning government RFID programs, launched without considering the politics of privacy and data security.
The federal government is considering RFID as a tool for a wide range of applications. A 2005 report by the General Accounting Office notes that dozens of federal agencies have begun to use, or are making plans to use, RFID technology - including the Departments of Agriculture, Energy, Labor, State, Treasury, HHS and Homeland Security. Nearly 60,000 private companies are already covered by the DOD mandate, and more may be required to use RFID as more federal departments and agencies roll out RFID-based programs.
Careless deployment of federal government RFID programs, however, could lead to more high-profile PR disasters for the technology an explosion of uninformed legislative and regulatory restrictions on RFID. This could negatively impact both private and public sector use of RFID - for companies providing the technology and those who have invested millions to us it. Moreover, an uncoordinated effort could force companies who do business with more than one federal agency to comply with inconsistent or incompatible RFID requirements. Entire industries may be forced to adopt inconsistent or ill-conceived RFID mandates that create expense, liability risk, and public relations risks - or cease doing business with the federal government. Bad government decisions will impact private sector use, as well as public use.
An RFID Intra-Government Council has been created by the Department of Commerce and Department of Defense, to exchange information within the federal government about pending RFID programs and develop more consistent policies and procedures for how RFID products are procured used. This Council has had regular discussions, but specific policies have not yet been proposed or adopted.
Congress, too, is getting involved. Conversations with key legislative leaders and Congressional committees indicate that RFID- inspired legislation is being contemplated in areas as diverse as agriculture, homeland security, transportation, public health, and federal procurement. Most of it is well-intentioned, if not always well-informed.
This year is an opportunity to create massive new demand for RFID systems by working effectively with federal government policy makers increasingly interested in the technology. Chasing state legislators who are simply responding to an uninformed public won't be sufficient. A comprehensive, strategic effort is needed to proactively help federal policy makers develop RFID policies and procedures that showcase the promise of this technology for consumers and taxpayers. RFID providers want a consistent, predictable, and growing market for RFID, and RFID users want to avoid inconsistent mandates with greater cost, risk, and uncertainty.
McKenna Long & Aldridge has been working with both RFID providers and users for several years. Our technology leadership and strong reputation within the Department of Commerce and DOD, where many RFID policies are being developed, have made us a trusted advisor to an increasing number of federal and state policy makers interested in RFID.
MLA is working with its clients to launch the comprehensive, proactive federal strategy needed to make 2006 a year of more opportunity than risk. We will be sponsoring a forum this spring for both RFID providers and users, to define and implement that strategy. If you are interested in learning more about MLA's involvement with RFID and RFID-related policies, please contact Doug Farry at 619-595-8017
Good Luck with the blog
The RfID industry seems to have been one step behind the politicians every step of the way -- reacting to their overreacting. I look forward to this resource to keep on top of what our government is up to. Maybe we can even get them to do something to help make RFID work better!
Well, we all knew politicians were knee-jerk sycophants. Did I mention greedy (taxing IP phones and internet purchasing)? But I thought they were smart enough to do a modicum of research before trying to legislate something that was only just ratified into fruition. It seems that at least 12 states have control issues. I recommend group therapy for their legislators. However, outside of spirtual enlightenment, I'm not sure familiar with the cure for megalomania.