[May 11, 2006]

China Staging RFID Standard Contest

(Comtex Business Via Thomson Dialog NewsEdge)BEIJING, May 11, 2006 (SinoCast China IT Watch via COMTEX) --China's huge market potential quietly triggered a contest for RFID (Radio Frequency Identification) standard.

The second-generation EPC (Electronic Product Code) technology has greatly reduced the threshold of RFID, with unit price of a RFID tag down to USD 0.08 from the former USD 0.5, and that of a reader down below USD 1,000, according to EPCGlobal Hong Kong.

In addition, China is formulating its own RFID standard currently, and will issue the new standard at the end of this year. Since RFID involves a series of standards, the RFID standard to be announced is just a low-frequency one. After the radio management committee opens the frequency scope, a full- system RFID standard will be put into effect.

"Main retailers in the world have started to ask suppliers to adopt EPC tap for the delivery of their goods, and these in China, as the world's manufacturing center, are of no exception," said a director of GS1 Hong Kong. At present, there are four manufacturers in the Pearl River Delta participating in the EPC experimental plan, and a supply chain will cost around HKD 600,000 possibly.

RFID technology has been widely applied in industries such as production, logistics, traffic, and transport. Tracking goods with EPC standard may reduce the rate of shorts by 16% and human resource by 10%, according to research of Wal-mart

In spite of this, the technology has not been popularized yet, with the main reason being the lack of a common standard in the industry. Nevertheless, the Chinese RFID market is growing furtively. The market capacity of RFID in China reached CNY 470 million in 2005, and would swell to CNY 5.87 billion in 2009, and the compound annual growth rate is as high as 65.6%.

The huge market potential makes the five biggest RFID standard organizations such as EPCglobal, AIMGlobal, and UID turn their attention to China. EPCGlobal, the strongest one in the world, possesses over 800 corporate members, including Wal- mart, METRO, Cisco, and Gillette.

At present, the biggest obstacle for the promotion of EPC standard in China is that the Ministry of Information Industry of China (MII) has not granted the frequency band needed by EPC, according to sources. EPCglobal headquarters and EPCglobal (China) are in talks with MII currently, hoping that China's RFID standard can be formulated on the basis of EPC.

"EPC has not become the international standard yet and only represents the interest of some international enterprises," said a member of China's electronic tag standard working group, "Considering factors such as national information safety, China will formulate its own RFID standard. Of course, the standard will be compatible with the other international ones."

There are mainly two reasons for China's formulation of its own standard, with the first one being the above mentioned national information safety, and the second the albatross on Chinese enterprises incurred by EPC standard.

An insider asking anonymity said that a company has to pay at least CNY 5,000 per year if it wants to be a member of EPC. If adopt EPC standard, it still has to render patent fee and electronic tag code using fee besides membership fee.

A director of CIITA RFID China Alliance said that compared with overseas giants such as Cisco, BEA, and IBM, the Chinese RFID industry is too weak as a whole. So the government expects to formulate and issue the national RFID standard after the industry is more mature.

(USD 1=CNY 8.0)

From dycj.ynet.com, Page 1, Wednesday, May 10, 2006
info@SinoCast.com

[ Back To TMCnet.com's Homepage ]

Discussions: