They don’t know where you are, after all

Wal-Mart has decided against testing a wireless inventory control system on shelves at a suburban Boston store.

Privacy advocates, who oppose the use of radio frequency identification (RFID) chips, greeted the decision as a victory, saying Wal-Mart backed down in the face of consumer anger over privacy concerns.

Spokesmen for Wal-Mart and Gillette, which had been Wal-Mart’s partner in the project, say the decision simply reflects a change in business priorities, with Wal-Mart now focused on deploying RFID in its sprawling distribution centers to track pallets and cases of goods.

“We never started a trial there [in the Brockton, Mass store],” Wal-Mart spokesman Tom Williams says. “They brought some hardware in for the shelf. And then removed it. That would have been in late May.”

Gillette spokesman Paul Fox says the consumer products maker never sent Wal-Mart any individual items, such as razors, outfitted with RFID tags, which combine the wireless chip, programmed with a unique number, and a small flexible antenna.

The chip is only activated when its scanned by a RFID reader. When the chip wakes up, it sends the unique identifier number, which the reader passes along to applications such as inventory control and shipping. The RFID readers can be big enough for forklifts to pass through or small enough to fit on retail shelves.

These so-called smart-shelves can read the RFID tag when an individual item is placed on the shelf and when it’s removed. The shelf can in effect count the items left on it, and alert inventory systems when the number falls below a threshold.

It’s this particularity, among other things, that outrages consumer privacy activists. A plan, earlier this year, by Italian apparel maker Benetton to add RFID tags to its clothing items, sparked an Internet-energized boycott. The company in April issued a statement that none of its garments currently carried RFID tags, and that it was continuing to evaluate the technology.

Italian designer Prada has had since December 2001 an extensive RFID system at its super-trendy Prada Epicenter store in Manhattan’s Soho district. A shopper can take a suit into the high-tech dressing rooms, which are made of clear glass that become opaque when you step on a black button on the floor. An RFID scanner in the room reads the tag and displays information about the suit, and accessories on a touch-screen LCD.

Gillette two weeks ago launched an RFID trial at its Fort Devens, Mass. packing and distribution center. “The goal here is to see how accurately we can identify and track cases of our product from packaging [into individual items], through inventory, to creating a customer order, such as shipping 100 cases of Mach 3 razors to Costco,” spokesman Paul Fox says.

Gillette continues working with two overseas smart-shelf trials, one by Tesco, a British grocery chain, and one by Metro AG, one of Germany’s biggest retailers.