WARNING: This post is a little long, legal, slightly technical and might be hard to follow but once you get through it you’ll have bragging rights on basic microchip ins-and-outs. A discussion of microchip readers comes in Part 3 of this series. (I had to split it up, there was just so much to this back-story, so there will be a Part 4 in this series, too).

In the US, there are two different kinds of chips based on the use of radio wave technology. There’s the 125 kHz chip (used by AVID and HomeAgain since the mid-nineties) and there’s the ISO (international standard) microchip which operates at 134.2 kHz (introduced by Banfield in 2004).

These two different radio wave frequencies represent two distinct technologies. But you can only buy one of these—the 125 kind used by AVID and HomeAgain (and since Feb 2007 by AKC-CAR).

The other, a chip manufactured by Crystal Technologies was introduced by Banfield (and marketed briefly in 2004) but is not available. This is the result of a law suit brought by AVID in 2004. HomeAgain “countersued,” citing monopolistic practices but AVID prevailed in early 2006 due to their early patents on their technology and access to the marketplace.

Here’s some background on the 125 versus 134.2 thing:

Currently (June, 2007) the so-called “ISO” standard for microchips manufactured for use in identifying animals has been adopted the world around. Only the major US companies (AVID and, almost immediately after, HomeAgain) opted for the 125 kHz technology instead of the ISO system, in spite of broad industry support for this international standard (set by the ISO, a Swiss organization that devises neutral standards—which, for example, make credit cards usable all over the world).

Already in use to identify wildlife in the US, the ISO technology itself enjoys the support of the AVMA, HSUS, AKC and other organizations due to its lower cost and equivalent technology. AVID first marketed its chip in the US with the help of Shering-Plough (now HomeAgain’s partner), claiming these chips were easier to read. It gained market dominance by distributing free readers to shelters nationwide and to all vet retailers.

Essentially, the US companies bet on Betamax, already knowing that the rest of the world preferred VHS. But getting in early on the marketing and ditribution of a patented technology was the only way to corner the US market on this promising technology.

You might think that’s OK—the rest of the world uses one standard and we use another. No big deal. It happens in other industries. But what happens when pets cross international lines? They need new microchips in the US. And what happens when a company tries to introduce the world’s standard in the US? They are legally barred from gaining entry, and not just for patent infringement.

You may have read about this story. Banfield, with its burgeoning chain of thousands of vet practices (and a whopping database to match) introduced the ISO standard microchip to compete with AVID and HomeAgain’s. Its stated vision was to bring the US market in line with international standards so that, eventually, all microchipped pets would be equally protected.

Sure, Banfield had money-making designs, too. It was partly trying to segment the US microchip market so it could get in on the action. But it was also acknowledging that VHS had won while we were all still using Betamax in our American bubble, to the eventual detriment of our increasingly globalized pets. (Nowhere, perhaps, is this more apparent than in Miami, though it may sound like hogwash in the heartland.)

AVID’s legal grounds for barring Banfield’s chip were based on their patents, but they also brought suit on animal safety concerns. They successfully argued that Banfield was doing its patients a disservice by introducing another microchip to the marketplace without the infrastructure in place to detect them.

Though Banfield had distributed 3000 free readers across the US, this was nowhere near the level required to detect these chipped pets. As a result, Banfield got lots of negative press for trying to introduce another standard—to the detriment of its pet patients who would not be protected by a technology most shelters don’t support (at least one of which was verifiably euthanized).

All that tough love aside, Banfield might have held the higher moral ground (“Let’s go the way of the rest of the world, fellow country-men.”) were it not for their way of going about it. They failed to inform their customers of the limitations of their isolated technology. In other words, they sold thousands of microchips without telling their clients that most local shelters and non-Banfield vets wouldn’t be able to read them, thereby rendering these chips ineffective. Now that’s not so smart, is it?

All Banfield-bashing aside (for there’s enough blame to go around) let’s talk about microchip reader technology and how that factors into things. See the next installment for more history and technology behind the microchip wars.