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Chinese view of RFID: more impact than Internet

From "Radio revolution," by Wang Xing, The Star Online (Malaysia), 26 February 2007:

"To most people, RFID (radio frequency identification) sounds like just one more bit of technical jargon - for now, that is. But someday, the mass application of the technology could change the fabric of civilisation more profoundly than the Internet has yet dared dream.

" 'It could give everything on earth a unique and traceable identity, greatly expanding the borders of the current Internet by making everything connected,' explains David Ouyang, secretary-general of the RFID China Alliance.

"RFID uses radio waves to identify objects, whether they are manufactured goods, plants or animals. A RFID 'tag' is attached to the object. This tag, which contains an integrated circuit and a built-in antenna, is able to transmit the object’s identification information to a wireless receiver, called a reader.

"Readers then convert the information into a digital format that can be sent to whoever needs the information. Unlike today's bar codes, which must be scanned individually by hand, multiple RFID tags can be read simultaneously by a reader with no need for human operators.

"The tag could also contain so much more information than a bar code that it could assign an identity to 'every grain of sand on earth'.

"These unique features, according to Ouyang, could open up the door to various revolutionary applications in retail, logistics, manufacturing, security and military industries.

"Ouyang says China's RFID was born three years ago, when the Chinese government began promoting RFID-based programmes such as the second-generation individual ID card and the transit card programmes.

"According to domestic consulting firm Analysys International, the overall scale of China's RFID market reached 778 million yuan in the third quarter of last year - a 37% increase compared with the same period of 2005.

" 'In the near future, the RFID market in China will also be mainly driven by government projects,' says Ouyang. 'We expect these programmes would lead to mass commercial applications of RFID technology in the country.'

"Although technologically advanced, RFID's high cost is one of the main obstacles to its mass application. It is much more troublesome in China, where most local manufacturers earn poor profit margins as subcontractors for multinationals.

" 'In China, few manufacturers could afford even the cheapest RFID tags,' says Ouyang. 'Because for many Chinese food, diary and textile manufacturers whose products are usually sold for one to two yuan (per unit), the adoption of RFID would mean a 40% to 80% cost surge on average.'

"Standards have also proven to be another uphill battle for RFID advocates. There are now several major standards, including EPC (Electronic Product Code) backed by the US and Europe, UID (Ubiquitous Code) backed by Japan, and IP-X backed by South Africa.

"In September 2006, a group of 15 Chinese ministries and commissions issued a white paper on RFID. It was decided that China would create its own standard.

"Alan Wang, business development manager of RCG China, a RFID solution provider, contends that the company is using different standards for its product since China has yet to release its own standards. This, Wang says, puts the company's long-term development at risk.

"This reminds Ouyang of how the Internet first came to China. 'The current status of RFID is like the Internet in the 1990s: it's expensive, has few users and lacks content and applications. But in the same way that the Internet changed our lives, RFID will surely impact us greatly.'

[RFID - 26 February 2007]