Quote: "The company has also won a three-year trial contract with California
to supply a version of the product that would track paroled prisoners in Los
Angeles and alert authorities when they had violated the terms of their
parole by leaving a set area."
Microchips Under the Skin Offer ID, Raise Questions
By Kevin Krolicki
LOS ANGELES (Reuters, 22 Dec 2001) - Picture a chip the size of a grain of
rice that can be injected into your body and give detailed information about
you to anyone with the right scanning equipment. A scene from a bad science
fiction film? A radical research project in some secret government
laboratory? The chip is neither fiction nor obscure science, but instead it
is a soon-to-be-marketed product ready to make its way to customers in the
year ahead.
The use of high-powered chips melded to the body has been a recurrent theme
of sci-fi from the 1984 cyberpunk novel ''Neuromancer'' to the 1999
blockbuster film ``The Matrix,'' but the announcement of a commercial-ready
product by Applied Digital Solutions (Nasdaq:ADSX - news) this week will
focus real-world attention on the potential and risks of such technology,
experts said.
Designed to store critical personal medical data, the chip could mark the
start of a more urgent debate about potential privacy invasions at a time
when privacy advocates are on the defensive over anti-terror initiatives
after Sept. 11.
``It's certainly going to raise issues that we haven't dealt with before,''
said Stephen Keating, executive director of the Denver-based Privacy
Foundation. Such radio-activated chips are already used to track cattle,
house pets and salmon.But this would mark the first attempt to apply the
technology to human beings, offering a potentially controversial means for
hospitals to ``scan'' patients in emergency rooms and for governments to
pick out convicted criminals.
Applied Digital said Wednesday it would begin marketing its implantable
VeriChip in South America and Europe, initially as a means to convey
information about medical devices to doctors who need a quick way to find
out how and where patients with pacemakers, artificial joints and other
surgically implanted devices have been treated. When activated by a radio
scanner, the chip would emit a radio signal of its own from under the skin
that would transmit stored data to a nearby Internet-equipped computer or
via the telephone, the company said.
The chip itself could be implanted in a doctor's office with a local
anesthesia and the site of the injection could be closed without stitches,
it said. But the company already has its sights on more ambitious
applications for the chips, which are currently capable of carrying the
equivalent of about 6 lines of text. Future versions could emit a tracking
beacon or serve as a form of personal identification, an executive said.
``There are enough benefits that outweigh the concerns people have about
privacy,'' said Applied Digital Chairman and Chief Executive Richard
Sullivan. Other experts remain skeptical, citing immediate practical
problems, such as the need to set standards that would make such chips more
universally readable, and longer-term concerns over civil liberties. Even
so, such implants are certain to become more widespread, said technology
forecaster Paul Saffo.
``Of course, we will do this,'' said Saffo of the Silicon Valley-based
Institute for the Future ``And it won't be just for the functionality. It
will also be for fashion. You've got a generation that's already piercing
themselves. Of course, they're going to put electronics under their skin.''
TOUCHED BY A DIGITAL ANGEL
Applied Digital, which has a $95-million market value and has been scarcely
followed on Wall Street, plans to file an application with the Food and Drug
Administration (news - web sites) in January to market the chip in the
United States, a process that could take another year to 18 months, Sullivan
said.
The Federal Communications Commission (news - web sites) has already
licensed the chip's use of radio frequencies because of an existing version
used to track runaway pets, said Sullivan.
The Palm Beach, Fla.-based company is just coming through a two-year-long
restructuring, reorganizing a far-flung telecommunications business around a
patent it acquired in December 1999 for a transmitter that could be
implanted in the body and powered by muscle movements.
The first related commercial application was a remote-monitoring device
called Digital Angel, introduced at the end of November, which combines a
wristwatch-like sensor linked to a wireless transmitter and a global
positioning system.
The device can transmit information on body temperature, pulse and location
and has been sold as a way to track Alzheimer's patients and children who
might wander from home. The company has also won a three-year trial contract
with California to supply a version of the product that would track paroled
prisoners in Los Angeles and alert authorities when they had violated the
terms of their parole by leaving a set area. Sales of the new implanted chip
could total $2.5 million to $5 million in 2002, Sullivan estimated, a small
fraction of a potential market the company has projected could be worth $70
billion or more.
Wall Street is excited about the chip. Applied Digital, which saw its stock
rise 18 percent to 45 cents on the Nasdaq on its initial product
announcement on Wednesday, is in talks with major pacemaker manufacturers
about a joint-marketing plan that would see the VeriChip implanted at the
same time as the heart-regulating devices, he said. Some see new
opportunities for high-tech security after the hijacking attacks on New York
and the Pentagon (news - web sites) killed nearly 3,300 on Sept. 11. The
attacks brought new support for the use of such technology by government and
more interest in its future commercial applications, Sullivan said.
``People are becoming less concerned about what information is out there,''
he said. Erwin Chemerinsky, a civil rights expert and law professor at the
University of Southern California, conceded that the public mood has
shifted, but said: ``It all depends on how this is used ... when the
government is invading the body there are always special privacy concerns.''
``This is rightly going to prompt debate, as you can imagine, but the good
news is that we'll have years to figure it out,'' said futurist Saffo.
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