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The National Security Archive at George Washington University

CONSORTIUM NEWS - Edited by Robert Parry


November 14, 2003

Wal-Mart, Proctor & Gamble Collaborate in Spying on Consumers

P&G, Wal-Mart store did secret test of RFID (11/9/03 - Chicago Sun-Times)

From the Chicago Sun-Times:

Shoppers in a suburban Tulsa, Okla., Wal-Mart were unwitting guinea pigs earlier this year in a secret study that two of America's largest corporations never expected you'd know about.

In the study, uncovered by the Chicago Sun-Times, shelves in a Wal-Mart in Broken Arrow, Okla., were equipped with hidden electronics to track the Max Factor Lipfinity lipstick containers stacked on them. The shelves and Webcam images were viewed 750 miles away by Procter & Gamble researchers in Cincinnati who could tell when lipsticks were removed from the shelves and could even watch consumers in action.

The study involved a new technology, known as Radio Frequency Identification (RFID), that enables retailers to use radio signals to electronically track products in warehouses and on store shelves, a technology critics fear ultimately could be used to track people once they leave the store.

Manufacturers and retailers are looking at ultimately putting the tiny chips into everything from soda cans and cereal boxes to shoes, clothing and car tires.

This worries privacy-rights advocates who envision tags in shoes and other personal items being linked to credit-card information so that retailers and government agencies could spy on the public.

Experts on RFID said the four-month study in Broken Arrow, Okla., was the first of its kind in the United States. Up to now, industry leaders have denied such testing had been conducted in this country.

The Sun-Times learned of the trial from a disgruntled Procter & Gamble executive and also from the firm that designed the "smart shelf" system. Researchers concealed "readers" in contact paper placed under the shelves and embedded RFID antenna chips in Lipfinity packaging.

Kevin Ashton, executive director of the Auto-ID Center at the Massachusetts Institute of Technology, downplayed the trial. "I think that the idea that someone's privacy is at stake because there are a few RFID tags in a few lipsticks in one store is silly," Ashton said.

The Auto-ID Center was founded in 1999 to develop RFID technology.

But Katherine Albrecht, founder of CASPIAN [Consumers Against Supermarket Privacy Invasion and Numbering], a privacy rights group, said, "On the surface, the Broken Arrow trial may seem harmless. But the truth is that the businesses involved pushed forward with this technology in secret, knowing full well that consumers are overwhelmingly opposed to it. This is why we have called for mandatory labeling of products containing RFID chips."

Procter & Gamble spokeswoman Jeannie Tharrington reluctantly confirmed the Broken Arrow test.

She said there was a sign at the Lipfinity display that "alerted customers that closed-circuit televisions and electronic merchandise security systems are in place in the store."

She said there were no specific warnings about RFID tags in the lipstick packages.

Tharrington said the tags had a short read range -- about a half inch. That meant that once the packages left the shelves, researchers could not track them or the people carrying them.

Albrecht said: "Customers do not go into a Wal-Mart expecting to be used as research subjects. And they certainly don't expect these companies to slip tiny tracking devices into the products they buy."

Tom Williams, spokesman for Wal-Mart, initially denied that the study had been done, only to call back the next day to say he found that indeed the test had been conducted from late March until mid-July.

According to the Sun-Times Wal-Mart, the world's largest retailer, has required that its top 100 suppliers tag their products with RFIDs by 2005.

[Read the source...]

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I agree this is a invasion of ones privacy. I shop at the Wal-mart in Broken Arrow, Ok and think they should have signs posted advise customer of this information. I'm sure it has nothing to do with the fact that sells would drop with such knowledge! Thanks for the subliminal!

Posted by: icey mbau at June 7, 2004 09:00 AM

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