RFIDWatch Weekly
September 20, 2006
Is California Governor Arnold Schwarzenegger about to deliver a knockout blow to the RFID sector in his home state? On Aug. 31, the California Senate passed legislation that would impose the most sweeping security restrictions to date on the use of RFID in certain public areas. All the bill needs now is the signature of Schwarzenegger, who has until the end of the month to approve or veto the measure.
The bill, which seeks to curb the use of RFID in public entities like libraries, government agencies and transportation systems like the Bay Area Rapid Transit District, would likely significantly reduce RFID adoption in the state. Public agencies already using the technology would be grandfathered under the new law. But even if Schwarzenegger rejects the measure, the RFID industry still faces the prospect of regulatory restrictions. Legislation is pending in at least 20 other states that would limit how and where RFID is used.
The current California bill is a scaled-back version of an earlier proposal, which sought to bar RFID technology from use in public areas for three years. But unlike the original bill, which drew fire from the American Electronics Association and a handful of technology suppliers (including Hewlett-Packard, Cisco and Philips), the revised bill has met with little opposition. Doug Farry, who is the chair of law firm McKenna Long & Aldridge's RFID Practice, says he hasn't seen any technology suppliers raise objections to the California bill, which among other things would create new avenues for lawsuits against RFID vendors (and the public entities using RFID) if in fact somebody's personal data were collected without his or her consent.
Although the pending legislation is troubling to some, others within the RFID sector don't have a huge problem with the re-worked bill. "The California bill looks reasonably sensible to me," says Kevin Ashton, vice president of marketing at ThingMagic, a Cambridge, Mass.-based vendor specializing in RFID readers, sensors, and other embedded and low-cost computing technologies. Ashton testified in front of the California legislature in 2003, when the state was under extreme pressure from activists to ban RFID entirely. "If you look where this bill has landed, it's really about ID cards in the public sector. I'm not convinced that this is terribly bad news."
Farry says the lack of resistance may reflect the fact that many pure-play RFID vendors—like Impinj and Alien Technologies—are small companies and often don't have the resources or time to pursue lobbying efforts. He believes it's time for the industry to join together, especially when it comes to privacy and security concerns that are often the result of ignorance.
"If the technology providers and the customers in the RFID space are content with the direction that things are going, they probably don't need to form [a lobbying group]," says Farry. "If they are alarmed or concerned about the direction that the state and federal government might go, it's always useful to have a unified voice."
One group is trying to provide that voice. Early this month AIM Global hosted its third annual RFID Executive Summit and Legislative Fly-In. Sixty industry executives from around the world attended the event in Washington, D.C., which included over 40 meetings with Senate and House staffers.
"Early feedback on the visits has been extremely positive," says Dan Mullen, AIM Global president. "We are greatly encouraged that this effort is filling a vital need for our industry to speak out in an organized fashion."