Will China’s RFID Standards Support EPC Protocols, Systems?

Aug 16, 2006Two months ago, a group of 15 Chinese ministries and commissions, including the Ministry of Science and Technology (MOST), issued a white paper about RFID technology and policy in China, explaining the country's plans to develop a national RFID standard.

The paper's authors describe China's plan to create an "independent RFID-related industrial chain" in which it will "make breakthroughs in such key technologies concerning industrialization as chip design and manufacturing, antenna design and manufacturing, packaging technology and equipment, reader design and manufacturing, and integration of electronic tags." It also says China is creating its own numbering scheme for RFID tag data, as well as its own middleware and system integration technologies, data-sharing system and testing platform.

Nowhere, however, does the 18-page document mention the international RFID standards body EPCglobal, nor the standards, electronic product code (EPC) numbering system or data-sharing network EPCglobal has already developed. It does say Chinese RFID standards will "correspond to international standards," but does not detail how they would correspond, nor whether RFID tags made to Chinese specifications would interoperate with tags compliant with ISO or EPCglobal standards. Last month, ISO ratified its latest UHF RFID standard, 18000-6C, based on the latest EPCglobal standard: Class 1 Gen 2.

As RFID industry players await China's RFID regulations—drafts of which are due soon, to be finalized next year—analysts and standards developers are weighing in on what the standards will look like and how they'll impact the growth of passive RFID technology in China. In a new report from market research firm ABI Research, titled "The_RFID_Market_in_China The RFID Market in China: Assessment of Chinese RFID Market Opportunities and Regulatory Issues," Hong Kong-based analyst Junmei He writes that it is simply too late for China to create a national standard, and that the country should instead begin working with EPCglobal to develop its domestic RFID industry around EPC tag and data standards. By failing to do so, she claims, the nation has created a "climate of uncertainty around the issue of RFID standards in China."

To back its claim that China will not be successful in developing a national standard, the report says most non-Chinese companies that contract Chinese manufacturers will require them to use EPC Gen 2 tags, and that "EPCglobal's aggressive move in the heartland of Chinese manufacturing" has already made EPC Gen 2 a de facto standard.

EPCglobal Hong Kong is already initiating a number of projects aimed at developing EPC-based RFID deployments. Last summer, the Hong Kong government earmarked HK$14 million ($1.8 million) to develop the infrastructure needed to track goods manufactured in southern China's Pearl River Delta (see H.K. Launches RFID Supply Chain Project). In addition, a number of companies and organizations in China—including its postal service—are conducting technology trials (see China Post Deploys EPC RFID System to Track Mailbags).

Still, Craig Harmon, president and CEO of information system consultancy QED Systems and senior project editor for the ISO 18000 air-interface standards, thinks China is still likely to institute a standards system that, while likely supporting ISO standards for UHF RFID, might still compete with EPC protocols. He posits that China could be sitting on some intellectual property it wants to build into passive UHF systems able to outperform the EPCglobal standard. If China established such a national standard, it could "create a chess match that would position China against U.S. retailers," says Harmon, "and that would not be productive."

"China believes that the future is in IP, and it wants to use its own," he says. "If China showed up with a superior technology, I don't think the international community would dismiss it out of hand, but it would have to be superior and it would need to comply with ISO standards [in order to be used for trade with other nations]."

Chris Adcock, president of EPCglobal, tells RFID Journal that his organization has been actively engaged with various ministries in the People's Republic of China over the last two years. Specifically, his team has been working to increase China's "awareness of the need for international standards in supply chains, and of the development of such standards within the EPCglobal community." EPCglobal, he predicts, will "continue to work with China's Ministry of Information Industry (MII) in order to ensure that China can play a full part in the global standards infrastructure being built by the EPCglobal community." Along with MOST, MII is leading China's RFID standards development.

Even if the Chinese RFID standard uses an air-interface protocol interoperable with EPC tags, Harmon believes the country will have its own network for sharing and storing RFID tag data, rather than using the data-sharing platforms being standardized by EPCglobal. Chinese companies might prefer to use a Chinese network to avoid paying EPCglobal subscription fees. In addition, China considers its data and communications a matter of national security and, therefore, will most likely not want to share them, says Harmon.

David Li, a member of MII's RFID working group, says China has a number of reasons for wanting to develop its own RFID standards. "China is looking at RFID as an industrial-building opportunity [that would] leverage Chinese silicon fabrications built up in the past 10 years, and energize the nation's chip-design houses, systems integrators and software developers," he says.

Royalties are another important consideration for Chinese companies, Li notes. Chinese makers of RFID hardware and software do not want to pay licensing fees linked to products using foreign patents and copyrights.