To have a better knowledge of RFIDs one must understand that there are two basic types of RFID tags, passive and active. Passive tags are used in inventory, animal, library, prisoner and passport tracking (US and UK passports are being issued with passive RFID data including passport photos). Active tags are useful in monitoring the performance and the conditions of functioning equipment such as motor operating characteristics, generator performance, pump flows, tank car temperatures and volume.
Software companies such as Oracle and SAP are beginning to develop RFID functionalities in their programs. It is thought that, as the cost of the tags and the associated software and hardware decrease, RFID may replace bar codes. However, there are many issues that must be resolved regarding their use before RFID tagging becomes a common and practical reality. Among the issues confronting this emerging technology are security of information and the regulation / standardization of frequencies.
There are also great concerns regarding protection from hackers. It has already been proven that viruses can infect RFID tags and databases. This vulnerability can permit unauthorized access to information as well as shut down databases or provide access to confidential information. Regulatory and standardization factors are also an issue that must be resolved. The frequencies that can be used for RFIDs are governed in the United States by the FCC, but other countries set their own rules for frequency licensing.