Precision Dynamics' microchip wristbands see healthy future
Using the same technology as electronic toll booths, security key cards and the newest U.S. passports, Precision Dynamics' sophisticated electronic know-how has found its niche at theme parks, where the high-tech wristbands act as high-security admission passes, cashless debit cards, hotel room keys and a form of identification to reunite lost children with parents.
Los Angeles Times
LOS ANGELES — In a nondescript manufacturing plant on a quiet San Fernando, Calif., cul-de-sac, a khaki-green machine the size of two pool tables end to end sucks in bright pink ribbon and spits out one of the hottest fashions in theme parks.
Here, in the northern stretches of suburban Los Angeles, the private company that began producing plastic hospital wristbands out of a Burbank garage more than 50 years ago has become the nation's top producer of a new microchip-enhanced wristband for amusement parks, concerts, resorts and gyms.
The wristbands use the same technology as electronic toll booths, security key cards and the newest U.S. passports. But at Precision Dynamics, this sophisticated electronic know-how has found its niche at theme parks, where the high-tech wristbands act as high-security admission passes, cashless debit cards, hotel-room keys and a form of identification to reunite lost children with parents.
In the past year alone, Precision Dynamics' wristbands came online at water parks in North Carolina and Texas, and at Water World, one of the nation's largest water parks, near Denver. In total, more than 50 theme parks strap the wristbands on incoming guests.
Company leaders envision a future when they can expand the technology for use for border security and hospital identification, among other uses.
"All sorts of things can be done with this technology," said Walter Mosher Jr., a company founder and member of the board of directors.
Precision Dynamics began in 1956 when a friend who worked in hospital supplies suggested that Mosher, a University of California, Los Angeles, engineering student, design a better wristband to identify patients at hospitals. At the time, hospitals made wristbands from plastic tubes, using separate tools to cut and fasten the bands on patients. For infants, hospital workers strung together lettered beads that spelled the babies' names.
At the machine shop at Burbank High School, Mosher and two partners devised a one-piece, plastic wristband that required no tools to fasten. The business, which started with only $2,000 in startup money, has expanded to 680 employees, a handful of trademark patents and offices in Brussels, Belgium; Japan; Italy; Mexico; and Brazil.
The idea of using radio frequency identification, known as RFID, technology in wristbands came to Mosher about 10 years ago when he learned that microchips were being implanted in dogs and cats to identify them in shelters and veterinary clinics.
A short time later, company Vice President Robin Barber moved ahead with the idea after meeting with managers from Great Wolf Resorts, who wanted to let guests buy food and drinks at the water parks without carrying a wallet or cash.
The result was a patented wristband affixed with a tiny antennae and a microchip, only slightly bigger than a postage stamp. Each microchip is programmed with a unique 16-character code.
A separate device known as a "reader" emits a low-power radio wave that powers up the chip to collect the information and upload it into a computer. The reader must come within a few inches of the wristband to activate the chip. Thus the wristband acts as a key to access a computerized debit account or unlock a hotel room or a clothes locker.
At theme parks, parents use a special kiosk to upload money that their children can spend, using the wristbands to buy food or play video games at the park. The microchips are coded so that the wristbands can be used only during a specific day. Once a hotel or theme-park guest checks out, the wristbands become obsolete.
Because cashless spending is more convenient, industry reports suggest that guests who use the wristbands spend as much as 25 percent more at resorts and parks.
The microchip wristbands represent about $3 million in annual sales for Precision Dynamics, only a fraction of the company's more than $100 million in annual sales, according to company officials.
The bulk of the business comes from the sale of wristbands that employ simpler bar-code technology to identify hospital patients, among other uses, and plain plastic wristbands with colors that tell security officers at theme parks and concerts who has paid for admission.
But price remains a barrier for expanding the technology.
Simple wristbands that use bar-code technology, for example, sell for as little as 14 cents each while the RFID wristbands sell for about $1 each. An RFID "reader" sells for about $450 each, roughly twice the cost of a bar-code reader.
In addition to cost, perhaps the biggest hurdle facing the widespread use of the microchip wristbands is the persistent fear that personal information could be stolen.
Katherine Albrecht, a personal-privacy advocate and leading critic of RFID technology, has called the microchips used in such wristbands "spy chips" because she fears they will be used to track people's movements. But Precision Dynamics notes that the wristbands cannot be read unless they come within inches of a "reader."
Mark Roberti, editor of the RFID Journal, an online and print periodical on the technology, said such fears are unfounded because the wristbands typically hold no personal information. Once the world's business leaders realize the wristbands are safe and effective, he says, the technology will be widely used.
A future in health care
Paul Chang, IBM's business strategy leader for emerging technology, agreed, saying RFID technology is in wide use in Europe and Asia.
But he said the U.S. is still playing catch-up, noting that tickets issued at the Beijing Olympics were embedded with an RFID chip to stymie counterfeiters.
Barber, the company vice president, believes the future of the wristbands is in health care, where the microchips can be programmed to hold a patient's blood type, medical history, drug allergy information and other data to reduce mistakes and confusion.
Unfortunately, too many hospitals today employ a variety of computer systems, many of which cannot communicate with each other, he said.
That, however, is not a problem at theme parks, he said. "The systems at theme parks are much simpler."
Copyright © 2009 The Seattle Times Company
UPDATE - 09:46 AM
Exxon Mobil wins ruling in Alaska oil spill case
UPDATE - 09:32 AM
Bank stocks push indexes higher; oil prices dip
UPDATE - 08:04 AM
Ford CEO Mulally gets $56.5M in stock award
UPDATE - 07:54 AM
Underwater mortgages rise as home prices fall
NEW - 09:43 AM
Warner Bros. to offer movie rentals on Facebook