by Richard Wilson
Tuesday 8 May 2007

NXP Semiconductors and Kestrel Wireless have come up with an RF chip which will tackle the problem of DVD theft in high street stores.

The firms are proposing to use an RFID chip which can be radio activated to disable DVDs at the point of manufacture and enable them at the point of sale. “This makes goods stolen at any point during the supply chain worthless, thus eliminating the incentive for theft,” said the companies.

The first application is likely to be DVDs, but the same technique could be used to protect other consumer electronics products, such as MP3 players and flash memory.

“Hundreds of millions of dollars from retailers, manufacturers and, indirectly, consumers are spent each year in order to prevent theft,” said Christophe Duverne, senior vice president and general manager, Identification, NXP Semiconductors. “This collaboration with Kestrel has the potential to dramatically reduce and ultimately eradicate the theft of optical media and consumer electronics in the retail supply chain.”

According to Bo Andersen, president of the Entertainment Merchants Association (EMA): “DVD and video game theft is a problem that has gone on far too long and at a cost of millions of dollars annually. Where solutions include more environmentally and consumer friendly packaging, improve merchandising with more shelf space for discs, and reduce the cost of returns – these are the ingredients for solutions that will greatly enhance everyone’s business.”

The RFID chips are embedded in consumer goods that are activated using Kestrel’s technology by an RFID reader at the point-of-sale terminal. When the chip is scanned, information is sent to the Kestrel network for authentication. Assuming all is correct, an enabling code is sent to the chip and the product is activated.

The firms are committed to developing other applications for RFID-enabled products through a series of pilot programmes.