Intelligent tags to fix the future Tagging set to be name of the game

The cost of items such as washing machines, televisions and computers could be pushed up in the next century by "intelligent tags", which will be able to detect whether they need repairs and allow them to be given new functions without being touched.

The tags are tiny computer chips which can also have a built-in radio transmitter and receiver, meaning that they can send and receive data from a distance. A faulty washing machine could diagnose its problem and broadcast it to a repairer, shortening the time needed to fix it. Software with extra programmes - such as a new way to wash woollens or coloured clothes - could also be loaded into such a machine, using the radio connection.

In the UK, 26 retail organisations are studying the potential of such tags. Though they currently cost about pounds 20, simpler versions with a minimum of detail could cost less than pounds 1.

A simpler form of the tags are already used by the US military and large corporations for warehousing and stocktaking systems. The US military realised it needed such tags during the Gulf War when it sent a large amount of military equipment in hundreds of shipping containers to a store in the desert.

"They were all in a huge open field. But then someone said, `Let's have the parts for that tank'. The trouble was, they knew the parts were there somewhere, but they didn't know where," said Jeremy Holland, business analyst at the Centre for the Exploitation of Science and Technology, who has just completed a report on the topic for the Department of Trade and Industry. "They reckoned that $3.5bn was wasted as a result."

Retailers such as Ikea and Dixons, electronics giant Philips and whisky distillers are keen to use such tags in their warehouses."Putting a pounds 20 tag on to a pallet of whisky or TVs doesn't add much to their overall cost, but it can save a lot of time," said Mr Holland.