Operations Research Management Science - Cyberspace

<BODY bgcolor="#ffffff" link="cc0000" vlink="cc0000" text="#000000"> <img src="../cleardot.gif" width=1 height=1 vspace=4 border=0><br>   <table border=0 cellspacing=0 cellpadding=0 width=480><tr valign=top> <td width=10><img src="../cleardot.gif" width=1 height=1 hspace=4 border=0></td> <td width=470> <FONT face="verdana, arial, helvetica" SIZE=2><B><I><A HREF="../../ORMS.shtml" TARGET="_top">OR/MS Today</A> - February 2004</I></B></font><BR> <hr size="1"> <img src="cleardot.gif" width=1 height=1 vspace=4 border=0><br> <font face="times new roman, times"> <img src="../cleardot.gif" width=1 height=1 vspace=4 border=0><br> <FONT face="verdana, arial, helvetica" SIZE=2><B>Cyberspace</B></FONT><br> <IMG SRC="../barbluehook.gif" WIDTH="468" HEIGHT="4"><br> <img src="../cleardot.gif" width=1 height=1 vspace=8 border=0><br> <FONT SIZE="+2"><B>The Internet of Small Things:<BR> RFID and EPC</B></FONT><BR> <img src="../cleardot.gif" width=1 height=1 vspace=6 border=0><br> <FONT face="verdana, arial, helvetica" SIZE=2><B>By ManMohan S. Sodhi</B></FONT><br> <hr size="1"> <img src="../cleardot.gif" width=1 height=1 vspace=12 border=0><br>    <BLOCKQUOTE><I>Ammu had an elaborate Calcutta wedding. Later, looking back on the day, Ammu realized that the slightest feverish glitter in her bridegroom's eyes had not been love, or even excitement at the prospect of carnal bliss, but approximately eight large pegs of whiskey. Straight. Neat.</I></BLOCKQUOTE> <P><B> From "The God of Small Things," the Man Booker Award-winning novel by Arundhati Roy.</B> <P>A year or so ago there were concerns regarding retailers' and governments' use of data from radio frequency identification or RFID. Since then, industry efforts have turned to supply chain efficiency, pilferage and getting the goods to the shelves. But first, what is RFID and what were those concerns? <P>A basic RFID system comprises a handheld or a fixed-mount device reader, itself comprising an antenna and a transceiver, and a tag with unique information about the item to which it is tagged [1]. The reader emits radio signals to activate the tag and to read and write data to it. These signals range from one inch to 100 feet or more. When within range, a tag detects the reader's activation signal and provides its own information that the reader decodes and passes on to the host computer. <P>Anything (or anybody) can be tagged: your dog, a pack of shaving blades, leather jacket, trucks, intermodal containers. A tag may be active, powered by an internal battery for read/write purposes. Such tags use high-frequencies from 850-950 MHz or 2.4-2.5 GHz, and offer long read ranges (> 90 feet) and high reading speeds for such applications as railroad car tracking and automated toll collection. Or, a tag may be passive, obtaining operating power from the reader. Such a tag is lighter and cheaper and therefore useful for retail. These are usually read-only and use low frequencies from 30-500 KHz. <P>Compared to bar codes, read-only tags can "read" faster (< 100 milliseconds) and in a variety of visually challenging conditions such as dust, snow, inside packing, etc. Read/write tags can be quite useful in manufacturing for tracking work-in-progress.<BR> <img src="../cleardot.gif" width=1 height=1 vspace=12 border=0><br> <FONT face="verdana, arial, helvetica" SIZE=3><B>The Internet of Things</B></FONT><BR> <IMG SRC="../barbluehook.gif" WIDTH="468" HEIGHT="4"><br> <img src="../cleardot.gif" width=1 height=1 vspace=2 border=0><br> EPC stands for "Electronic Product Code" just as UPC stands for "Universal Product Code." It comprises an approach to data content, technical standards, coding standards, mark-up language and software systems. It was conceived as "an Internet of things" [2] with every item in the supply chain all the way to an individual point-of-sale item to be tagged to constantly report its location, condition and status to on-site information systems or to remote databases via the Internet. This can be expensive given the current cost of a tag at 25-30 cents and the cost of collecting information. To contain costs, retailers and manufacturers are currently interested in tracking containers or bins rather than individual items. While EPC is still under development, some companies have started using other formats (EAN.UCC) in field trials within their four walls to track inventory. <P>About a year ago, McCullagh [3] from CNET.com expressed privacy concerns. He questioned whether we could be constantly tracked through our clothes, shoes or even our cash in the future in such scenarios as: <P> The Gap linking your sweater's tag with the credit card you used to buy it, and then flashing ads on computer screens based on your spending patterns (as in <I>Minority Report),</I> <P> The police or the government gaining cradle-to-grave surveillance (biometric eye-scanning for "foreigners" has already begun at U.S. airports), and <P> Burglars canvassing alleys with RFID detectors, looking for tags on discarded packaging indicating expensive electronic gear. <P>McCullagh acknowledges the benefits: lower inventories, reduced theft and the convenience of automatically debiting items from your tagged credit card as you walk out from the store. But his worry is about tags staying active after they leave the store. He suggests that retailers notify consumers when tags are present in what they are buying and disable these tags by default at the checkout counter. <P>McCullagh's privacy concerns are misplaced, but for a reason other than the industry's current focus on the supply chain rather than on the end consumer. People are already providing much information to their credit card companies and to retailers for a few airline miles, some discounts, 1 percent cash back, etc. So most people would be happy to wear or otherwise carry around as many tags as they can. As such, companies can afford to hedge around this issue to keep things moving. Gillette Vice President Dick Cantwell asserts, "At this stage of the game, the tag is no good outside the store" [3]. But at some stage it will be. <P>There is much value in tracking cartons and containers. There is also value in individual item tracking when the tags are cheap enough (5 cents or less) as manufacturers would gain insight into consumer use to provide more value. As regards privacy, it can only be lost once  like Ammu's virginity on her wedding night. Another whiskey, please. <BR> <img src="../cleardot.gif" width=1 height=1 vspace=12 border=0><br> <FONT face="verdana, arial, helvetica" SIZE=3><B>References</B></FONT><BR> <IMG SRC="../barbluehook.gif" WIDTH="468" HEIGHT="4"><br> <img src="../cleardot.gif" width=1 height=1 vspace=2 border=0><br> <OL> <font size=1> <LI>"What is Radio Frequency Identification (RFID)," <A HREF="http://www.aimglobal.org/technologies/rfid/what_is_rfid.asp" TARGET="_new">http://www.aimglobal.org/technologies/rfid/what_is_rfid.asp</A> downloaded Jan 18, 2004. <LI>"EPC: The End of Bar Codes? (Part 1 of a series)," <A HREF="http://www.aimglobal.org/technologies/rfid/resources/articles/april03/epcpart1.htm" TARGET="_new">http://www.aimglobal.org/technologies/rfid/resources/articles/april03/epcpart1.htm</A>. <LI>McCullagh, D., Jan 13, 2003, "Big brother in small packages," <A HREF="http://news.com.com/2010-1069-980325.html" TARGET="_new">http://news.com.com/2010-1069-980325.html</A>, downloaded Jan. 18, 2004.</font> </OL> <img src="../cleardot.gif" width=1 height=1 vspace=4 border=0><br> <IMG SRC="../barbluehook.gif" WIDTH="468" HEIGHT="4"><br> <img src="../cleardot.gif" width=1 height=1 vspace=2 border=0><br> <FONT face="verdana, arial, helvetica" SIZE=2><I><B>Dr. ManMohan Sodhi</B> (<A HREF="mailto:M.Sodhi@city.ac.uk">M.Sodhi@city.ac.uk</A>) is a member of the operations management faculty at Cass Business School in London.</i></font><BR>  <img src="../cleardot.gif" width=1 height=1 vspace=5 border=0><br>  <img src="../barblue.gif" width=468 height=1 border=0 alt=" "><br> <img src="../cleardot.gif" width=1 height=1 vspace=8 border=0><br> <font face="verdana, arial, helvetica" size="1"> <CENTER><script type="text/javascript"></script> <script type="text/javascript" src="http://pagead2.googlesyndication.com/pagead/show_ads.js"> </script></CENTER><br> <img src="../cleardot.gif" width=1 height=1 vspace=8 border=0><br> <LI> <A HREF="tocfr.html" Target="_top"><I>Table of Contents</A><br> <img src="../cleardot.gif" width=1 height=1 vspace=4 border=0><br> <LI> <A HREF="../../ORMS.shtml" TARGET="_top"><I>OR/MS Today</I> Home Page</A><br>  <img src="../cleardot.gif" width=1 height=1 vspace=8 border=0><br> <img src="../barblue.gif" width=468 height=1 border=0 alt=" "><br> <b><i>OR/MS Today</i></b> copyright © 2004 by <A HREF="http://www.informs.org/" target="_new">the Institute for Operations Research and the Management Sciences</a>. 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