INDUSTRY NEWS

RFID, EAS Standard Set

In early November the management board at GS1, the overseer of EPCglobal standards related to electronic product code (EPC) and radio-frequency identification technologies (RFID), ratified a new version of the ultrahigh-frequency (UHF) EPC Gen 2 standard—EPC Gen2v2. According to the news accounts, this revision improves security, adds versatility, and includes a few important privacy features for consumers. Following are the highlights:

Compliant tags can be used for electronic article surveillance (EAS).

Some data can be set as permanent (unchangeable), while other information can be rewritten. Retailers using existing Gen 2 tags can employ their own software to update a tag as purchased in their own database, in line with GS1’s 2009 EAS guidelines, and ensure that it won’t trigger an EAS alarm upon exiting the store.

Allows the partitioning of user memory into one or more files.

Readers can be assigned access privileges for some or all files.

This partitioned memory could store information regarding maintenance, product purchases or returns, as well as any other product lifecycle information deemed essential for encoding directly on the tag.

Enables a tag to cryptographically authenticate a reader, providing selective access only to authorized devices.

Conversely, readers will be able to cryptographically authenticate tags, providing extensive protection against product counterfeiting and tag cloning. This capacity should boost adoption by the luxury-goods, pharmaceutical, aerospace, and defense industries by ensuring that data is secure on the tag and cannot be altered without authorization.

Enables the tag to be updated at the point of sale with an “exit code,” indicating that the tagged item has been paid for.

In addition, the new standard includes a command intended to protect consumer privacy. Specific readers can render a tag untraceable by restricting identifying information, such as parts of the EPC, extended tag identification, or user memory. The tag can also accomplish the same goal by significantly reducing its operating range to a percentage of its previous range. The amount by which that read distance would be reduced depends upon the tag itself. With the untraceable command, a user can protect a consumer’s post-sale privacy by hiding data until a tag is interrogated by a reader with an untraceable privilege, such as reader in a store when a purchased product is returned for refund or exchange.

Venezuela Takes over Retailers; Mandates Low Prices

Having read the many news accounts of downright embarrassing behavior here in the U.S. by the rioting or unruly Thanksgiving Day and Black Friday “customers” maiming people to get their hands on a good deal, I’m going to remind this readership just how close we are to the third world. Take another look at the headline above. A similar story will likely take place in a “free” country, like Greece, before 2014 ends. Let’s hope it doesn’t happen here anytime soon.

While you are reading, imagine that you are part of the management team of Daka, a Venezuelan electronics and appliance retailer patterned after Best Buy. The best accounts of the situation can be found at the PanAm Post (panampost.com). Early last November, Venezuelan President Nicholas Maduro ordered military forces to occupy Daka and forced them to sell merchandise at “fair prices.” Their store managers were arrested and charged with a crime akin to usury. Government inspectors were dispatched to check prices at a sampling of other businesses. “This is for the good of the nation,” Maduro said, referring to the military’s occupation of Daka. “Leave nothing on the shelves, nothing in the warehouses. Let nothing remain in stock!”

As a result, many other retailers and businesses lowered prices to below “breakeven levels,” so they wouldn’t incur the wrath of the government. Venezuelans ran to the stores and joined long lines, hoping to buy imported products “on sale.” In several parts of the country, crowds of people lost control and used the situation as license to loot the stores.

The main catalyst is the current economic situation, marked by currency controls that are suffocating the country’s private sector. Unfortunately, the black market for U.S. dollars has caused a situation where large chains like Daka can exchange Venezuelan bolivars for the pegged official rate of 6.3 per dollar. They import merchandise at a reasonable cost, but are able to price items closer to the going black market rate, which is currently around ten times higher than the peg.

President Maduro, an avowed Marxist-communist, is being compared to Robin Hood, as he attempts to squash the last vestiges of Venezuela’s free market and let the government engineer a lowered, but equal outcome for everyone. Local economists observe that the consequences of this economic war will include shortages, closed businesses, and unemployment—all contributors to the exacerbation of current problems, rather than relief.

Nobody wants to envision a situation like that here in America. Our looting and bad behavior is being caused by something different. How would you define the causes?

by Robert L. DiLonardo

DiLonardo is a well-known authority on the electronic article surveillance business, the cost justification of security products and services, and retail accounting. He is the principal of Retail Consulting Partners, LLC (retailconsultingllc.com), a firm that provides strategic and tactical guidance in retail security equipment procurement. DiLonardo can be reached at 727-709-6961 or by email at rdilonar@tampabay.rr.com.