Card Punching: “Lower Cost Smart ID Cards”; Card Technology Today

Lower Cost Smart ID Cards
By Tom Kleeman, CEO, Spartanics

Smart ID card designers often lead the pack when it comes to incorporating state-of-art security features into card designs. Because the costs of compromised identities are high, there is a greater willingness to include tamper-proof laminates and other security add-ons to information-rich chips, even if these additional features cost more. There is a limit, however, to how much extra cost the market can bear. It’s largely been up to smart ID card manufacturers who are obliged to operate in competitive bidding situations to look for ways to keep smart ID card costs in check. In turn, suppliers to ID card manufacturers have created more intelligent manufacturing systems that can help defray the ultimate card costs.

Actually, these seemingly most modern card products and their emphasis on tamper-proof features can trace their roots back to antiquity. Attempts at establishing identity go back 4000+ years to Ancient China and Babylon, which each used fingerprints on clay tablets for identity verification. During the early Roman Empire all slaves exported to Asia were tattooed “TAX PAID”. The Romans also used tattoos with their military and branded mercenaries with tattoos along the lines of “STOP ME, I’M A RUNAWAY!” It’s reported that there was a booming business in tattoo removal in Ancient Rome; perhaps the first reported systematic identity falsification and a first impetus in the spiral of identity protection measures that now takes the form of an information-rich smart ID card.

Biometric-capable chips and the information systems needed to create them, holograms, microtext, OVI (Optically Variable Ink), UV/IR security marks and other multilayered security features found in most smart ID cards are relatively costly. From a card manufacturing perspective these added costs combine to create a situation where the last thing you want to do is go to the trouble of finishing a card with all its expensive components if one or more of these components is defective and will eventually get the card classified as a reject card. It’s also a given that production processes must be failsafe when it comes to correctly correlating the identity information on the card with the actual identity of the eventual card holder.

For example, consider the relative costs of roll thermal laminateing films used in different types of card products. Non-secure laminate film typically costs US$0.05 per card. A secure laminate film that is tamper evident, perhaps with an image, typically costs US$0.15 per card. The high end secure laminates with security shield images can go up to US$0.25 per card. In most smart ID card manufacturing plants, laminate is added to sheets of cards in a 3-up format created frequently by digital printing. This translates into film costs as high as US$0.2531 per linear inch. Every time a sheet misfeeds in the laminating equipment it means that approximately US $3.6.00 is wasted. Similarly, running more laminate than required when starting or stopping die cutting adds up quick.

Replacement costs for misprinted cards are likely to be even more significant than material costs per se. Usually a double-sided offset print process is used for background security printing to enable the fine feature detail that is not possible with digital printing. An information-rich chip is added. A double passsecond pass with a digital printing process is then required to add other variable data and photos. If manufacturing processes create defects in the core sheets used for the cards there is much more to consider than the cost of the core sheet. It is the much higher costs of card replacement – reprinting and correlating with correct information in chips and databases— that needs to be considered.

Until 2007, these type costs from things like misfeeding of automated equipment were just a fact of life for smart ID card manufacturers. In various parts of the world, however, there are now smart ID card manufacturers that have invested in manufacturing equipment armed with the greater machine intelligence that can avoid many of these costs.

Card punching equipment that incorporates smart sensing systems is a case in point. This past year such equipment was first made available to worldwide ID card manufacturers. Costs of wasted core sheets are minimized by these systems’ ability to detect misfeeds and double feeds, improper lamination or film splices. These smarter systems also delay the start of laminators until there is a core sheet ready to enter the laminator and similarly stop the laminator in the minimum distance needed to ensure good lamination of any core sheet in process. Laminators are automatically stopped when core sheets aren’t available and re-started automatically when core sheets are available.

These smarter ID card punching systems also streamline the ongoing auditing of production processes needed for secure card manufacture. Mismatched sheets are detected by these smarter machines, which report the tracking number of each core sheet back to the control systems. Systems can be programmed to automatically stop if core sheets are presented out of tracking number sequence. Along the way, database verification is ongoing, such that systems are also automatically stopped if tracking numbers are not valid or are duplicates. All of this tracking is done in real time.

Before the ID card markets grew to today’s size there was little impetus to develop card punching systems with all of these type smart sensing controls tailored to the specifications of the smart ID card market. Now, however, the growing smart ID card and other security-feature rich ID cards are driving R&D for card manufacturing equipment with this type of intelligence that can defray material costs.

This greater machine intelligence is also providing smart ID card manufacturers a way to get more out of the human resources at their disposal. While well-trained and highly motivated operators may be able to mimic what these intelligent manufacturing machines can do, it still would require constant effort on their part for monitoring conditions that the machines can “see” automatically. It allows smart ID card manufacturers to use relatively low skilled and lightly trained operators to get maximum performance out of these smarter automated systems. This too ultimately helps drive down costs per card.

The same dynamic of growing ID card markets has similarly spawned a new class of automated card inspection technology that is geared for smartall ID card products. While manufacturers of other type card products may still try to make due with human inspectors, it is nearly impossible to do so with the security feature-rich smart ID card designs. Microtext cannot be checked with the human eye efficiently, nor can OCR/OCV type features. Perhaps even more critical is the requirement that today’s inspection system be able to anticipate security features that aren’t utilized today. Staying one step ahead of counterfeiters compels ID card designers to continue to multi-layer security features —microtext, OVI, UV, IR, bar codes, OCR/OCV, etc.—and to combine these features with data matching technology. An inspection system must be flexibly designed so that it can be added to, if needed, when new security features are added to card designs.

To meet this smart ID card market demand for flexibility in anticipation of changing products there are now automated inspection systems that allow one to seamlessly add as many cameras are required by the complexity of the ID card design without any reduction in production speed. These systems not only use better processors but also are designed to combine hardware (e.g. cameras) with software engineering with maximum versatility. The better automated inspection systems now available to smart ID card manufacturers also are smart self-learning systems that can train on a stack of 20 or so “good” cards and complete job set up in minutes, which goes a long way to eliminating the production bottlenecks that are associated with less sophisticated inspection machines and certainly with human inspectors.

The way in which automated inspection systems are used in smart ID card manufacture has tended to change as more layers of security features are added to card designs. Smart ID card manufacturers are inspecting proto-cards multiple times, in addition to the final card inspection. The comparative cost of chips and base cards (approximately 20:1) and similarly high costs for other added security features is such that the benefit of inspecting base cards and cards at various stages of finishing provides a significant pay off in decreased material costs for what ultimately becomes reject cards.

Like the better processors in state-of-art ID card inspection systems, there are many components of the better manufacturing systems now available to smart ID card manufacturers that are less related to smart ID card market growth and are more a reflection of overall technological advancements affecting a wide swath of products worldwide. An example is the proliferation of RFID product markets, and how this is making the prelams with antennae and chips better and less expensive for contactless ID card manufacturers. While the screen printing processes that are used to make high frequency cards can trace their origins to the early 20th Century, the mushrooming applications for RFID products in recent years – for inventory tracking, automotive components, textile transfers, etc.—helped drive many improvements in screen printing processes that weren’t available only a few years ago. Before, prelam suppliers could only find screen printing presses in one configuration – 400 mm wide—and would need to adapt their job formats to make do with the machine dimensions that could be found. Now it is actually far more cost-effective to source equipment that is custom-configured for actual application requirements. The inks used in screen printing antennae are also better now, with many recent innovations in ink chemistry that allow them to be screen printed with more consistent quality, UV cure more quickly, and still have the conductive properties needed for the functioning antennae. In the near future, we can expect these ink improvements to continue. There is also much talk of using the now widely available laminate materials such as Teslin™ that can better cushion and protect chips and antennae in the contactless cards.

In addition to the above discussion of dynamics driving smart ID card manufacturing costs down, it is also worthwhile to consider the dynamics of what is keeping these costs at today’s level. Physical card production is a small part of the overall costs of smart ID card programs, and the overall price tag may tend to keep the prospective market of smart ID card users smaller than it might someday be when overall program costs are down. Those entities that cannot do without smart ID cards will get them, but often with a good deal of sticker shock at the relatively greater costs they involve. For example, Chicago’s O’Hare airport needs to create 44,000 badges that are renewed annually for their workforce, according to standards set by the U.S. Transportation Security Administration. This newer O’Hare system is far more complex than what was used in the past, including a fingerprint template in the card and in the database and involving many print readers for access control throughout their facility.
The old system they used involved a standard CR100 plastic card with a magnetic strip and PIN system. The cost was US$0.80 per card. Their new smart ID card is a CR80 plastic card with a magnetic stripe and “Desfire” contactless components, costing US$6.00 per card.

Another major factor in keeping smart ID card market growth somewhat constrained is the widespread ambivalence, at least in North America, regarding many of the biometrics that would likely otherwise be more widely incorporated into smart ID cards. According to a recent survey published by www.privacy.org some of the negative attitudes in the US and Canada about using biometrics include: 1) “It will be very expensive” – 75%; 2) “Criminals will find a way around this technology” – 71%; 3) “There is a high potential for government to misuse the information” – 64%; 4) “It will greatly reduce personal privacy because the government will be able to track your movements” – 61%. When this survey drilled down in details to ask the acceptability of different types of biometrics, they found that only 48% of responders found voice recognition to be acceptable, only 44% found facial scans to be acceptable, and only 34% found DNA profiling to be acceptable. Only 35% strongly support the use of biometrics in a proposed national ID card, which in itself is still highly controversial in the United States.

That said, the demand for both smart and non smart ID cards only grows. Globalization and the greater mobility worldwide make the risks of identity theft and physical security greater. Public concerns over privacy and the costs of smart ID cards will not go away quickly and will continue to impact smart ID card projects, but what we are already seeing is enough growth in the smart ID card market to drive the development of better manufacturing methods and lower cost smart ID cards.

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Tom Kleeman is CEO of Spartanics, which engineers and manufactures a range of automated equipment for inspection, punching, screen printing and counting used by global card manufacturers among others finishing flat stock material.