Identity chip raises privacy concerns

Hitachi has developed a chip that could be woven into paper money to help identify counterfeits, and which could also have wide ramifications for the identification and surveillance technologies.

The chip, called Mew, measures just 0.4 millimeters on a side, and stores information such as identification and security code. It includes 128 bits of read-only memory (ROM) and RF wireless circuitry that allows it to transmit over a distance of about 30cm. If inserted in money, a reader unit would be able to instantly detect authentic bills.

Most identity chips are currently several millimeters on a side.

While the chip currently requires a reader unit to work, its size carries big implications for the future of identity technology. For example, future chips could be implanted into all paper money and be connected wirelessly to the Internet, so that authorities would be able to monitor the movement of all cash.

Such chips could also be embedded in other consumer products to track them in the event of theft.

Privacy advocates say the idea of being able to seamlessly track people, money and objects might be attractive to companies and governments, but it raises concerns over how far such technology might go. "What you could achieve with a chip like this is to ensure that surveillance becomes invisible," said Simon Davies, head of Privacy International. "If you really could track things in such an unobtrusive manner than anything an individual does can theoretically be captured."

He said that the ability to track currency is unlikely to be adopted by any democratic government because of the protest it would arouse. "But lots of authorities, like banks, would love to have that facility," he said.

Hitachi says it is considering adding rewritable memory to the device, but for the moment is uysing ROM to prevent data falsification.

The chip will begin sampling this autumn and Hitachi will begin marketing it next spring. Mew Solutions, the venture formed by Hitachi to promote the chip, expects sales of £145m (about £98m) by 2005.

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