Wednesday, April 14, 2004

Paying for drinks with wave
 of the hand
Club-goers in Spain get implanted chips for ID, payment purposes
Posted: April 14, 2004
5:00 p.m. Eastern

By Sherrie Gossett

 Being recognized has never been easier for VIP patrons of the Baja Beach
Club in Barcelona, Spain.

 Like a scene out of a science-fiction movie, all it takes is a
syringe-injected microchip implant for the beautiful men and women of the
nightclub scene to breeze past a "reader" that recognizes their identity,
credit balance and even automatically opens doors to exclusive areas of the
club for them.

 They can buy drinks and food with a wave of their hand and don't need to
worry about losing a credit card or wallet.

 "By simply passing by our reader, the Baja Beach Club will know who you
are and what your credit balance is," Conrad K. Chase explains. Chase is
director of the Baja Beach Club in Barcelona.

 "From the moment of their implantation they will also have free entry and
access to the VIP area," he said.

 In the popular club, which boasts a dance floor that can accommodate
3,000, streamlined services and convenience matter to Chase's VIP customers.

 Baja Beach Clubs International is the first firm to employ the "VeriPay
System," developed by Applied Digital's VeriChip Corporation and announced
at an international conference in Paris last year. The company touts this
application of the chip implant as an advance over credit cards and smart
cards, which, absent biometrics and appropriate safeguard technologies, are
subject to theft resulting in identity fraud.

 Palm Beach-based Applied Digital Solutions (NASDAQ:ADSXD) unveiled the
original VeriChip immediately after the 9-11 tragedy. Similar to pet
identification chips, the VeriChip is a syringe-injectable radio frequency
identification microchip that can be read from a few feet away by either a
hand-held scanner or by the implantee walking through a "portal" scanner.
Information can be wirelessly written to the chip, which contains a unique
10-digit identification number.

 Media seized on the novelty factor of the chip implant, driving it to
worldwide headlines in 2001.

 Last year, Art Kranzley, senior vice president at MasterCard, speculated
on possible future electronic payment media: "We're certainly looking at
designs like key fobs. It could be in a pen or a pair of earrings.
Ultimately, it could be embedded in anything  someday, maybe even under
the skin."

 Chase calls the chip implant the wave of the future.

 The nightclub director has been implanted along with stars from the
Spanish version of the TV show "Big Brother."

 "I know many people who want to be implanted," he said. "Actually, almost
everybody has piercings, tattoos or silicone."

 Will the implant only be of use at the Baja?

 "The objective of this technology is to bring an ID system to a global
level that will destroy the need to carry ID documents and credit cards,"
Chase said.

 During a recent American radio interview, Chase said the CEO of VeriChip,
Dr. Keith Bolton, had told him that the company's goal was to market the
VeriChip as a global implantable identification system.

 With only 900 people implanted worldwide, though, the global mandate isn't
exactly around the corner, and current applications are extremely limited.

 Chase added, "The VeriChip that we implant at Baja will not only be for
the Baja, but is also useful for whatever other enterprise that makes use
of this technology."

 He also alluded to plans for FN Herstal, which manufactures Browning and
Smith and Wesson firearms, to develop an implant-firearm system that would
make a firearm functional only to the individual implanted with its
corresponding microchip. A scanner in the gun would be designed to
recognize the owner.

 Chase's mention of the FN Herstal-Verichip partnership came a full week
before it's formal announcement by Applied Digital yesterday.

 Chase believes all gun owners should be required to have a microchip
implanted in their hand to be able to own a gun. While yesterday's
Associated Press story on the prototype is primarily from the angle of
police usage, WND reported two years ago that from the he outset of the
company's acquisition of its "Digital Angel" implant patent  said to be
GPS trackable  Applied touted the implant as a potential universal method
of gun control.

Chase also claimed that the VeriChip company had told him that the Italian
government was preparing to implant government workers.

 "We are the only company today offering human implantable ID technology,"
said Scott R. Silverman, chairman and chief executive officer of Applied
Digital Solutions. "We believe the market opportunity for this technology
is substantial, and high-profile successes such as in Spain will serve as
catalysts for broader adoption."

 Since 1999, the Applied Digital Solutions has boasted that it also has a
GPS-trackable chip in the works, but four years later the  device has yet
to come to market. Some mechanical engineers contend such a device requires
substantial antenna length and that creating a self-contained unit in the
space of a tiny chip is virtually impossible. In addition, questions of
accuracy of new GPS consumer items have been raised by the press. A
previous Wall Street Journal "road test" of different manufacturers' GPS
watches and devices for children had some kids tracked to the Sahara
Desert, rather than New York City where they were.

 Despite the kinks that may need to be worked out, security of loved ones
and personal property remains one of the chief marketing focuses of
personal GPS devices and RFID chip firms.

 Meanwhile, in Barcelona the VeriChip is gaining a following of
enthusiastic "early adopters."

 "Everyone embraced the electronic payment application," Chase said. "My
customers like the fact that they do not have to carry a credit card or ID
card with them. With the VeriPay system, they no longer have to worry about
their credit cards getting lost or stolen."

R. A. Hettinga <mailto: [EMAIL PROTECTED]>
The Internet Bearer Underwriting Corporation <http://www.ibuc.com/>
44 Farquhar Street, Boston, MA 02131 USA
"... however it may deserve respect for its usefulness and antiquity,
[predicting the end of the world] has not been found agreeable to
experience." -- Edward Gibbon, 'Decline and Fall of the Roman Empire'

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