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Chris Paget, director of research and development at Seattle-based IOActive, used a US$250 Motorola RFID reader and an antenna mounted in a car’s side window and drove for 20 minutes around San Francisco, with a colleague videoing the demonstration. During the demonstration he picked up the details of two US passport cards, which are fitted with RFID chips and can be used instead of traditional passports for travel to Canada, Mexico and the Caribbean. “I personally believe that RFID is very unsuitable for tagging people,” he said. “I don’t believe we should have any kind of identity document with RFID tags in them. My ultimate goal here would be, my dream for this research, would be to see the entire Western Hemisphere Travel Initiative be scrapped.”

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Part of the problem is likely the lackluster sales for the company's most famous product. Only 222 medical patients in total have opted to get RFID chips from VeriChip implanted as of the end of 2006, according to documents filed by the company with the Securities and Exchange Commission as part of its initial public offering. It's a modest number, the company says, and revenue for these systems is far below projections. "To date, we have only generated approximately $0.1 million in revenue ($100,000) from sales of the microchip inserter kits, significantly less than we had projected at the beginning of 2006. We may never achieve market acceptance or more than nominal or modest sales of this system," the company stated.

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Information transfer requires actual physical connection to the Memory Spot and Taub says they designed it that way. "We don't want to increase the range of contact," he said. "We think it's just right." Memory Spot technology works independently of Internet connection. It is meant for physical data transmission, much like RFID, although another fundamental difference is that the data on Memory Spot is rewriteable whereas the majority of RFID chips are read-only.

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"Basically, you've given everybody a little radio-frequency doodad that silently declares 'Hey, I'm a foreigner,'" says author and futurist Bruce Sterling, who lectures on the future of RFID technology. "If nobody bothers to listen, great. If people figure out they can listen to passport IDs, there will be a lot of strange and inventive ways to exploit that for criminal purposes." RFID chips are used in security passes many companies issue to employees. They don't have to be touched to a reader-machine, only waved near it. Following initial objections by security and privacy experts, the State Department added several security precautions.