While media attention focuses on mandate-driven RFID deployments in the West, China's ambitions to be "manufacturer to the world" would seem to make it ripe for RFID. But a new study from ABI Research portrays a diverse RFID market developing unevenly according to technology type, and subject to uncertainly around proposed standards.

According to analyst Junmei He, the Chinese LF RFID market is mature both in terms of industry chain and market applications. LF RFID has been widely applied in low-end markets such as campuses, internet cafes and access control applications. The (ISO14443) HF standard serves the largest market in China, including identification, transportation, campus, and highway toll collection cards, and internet cafes. The HF market based on ISO15693 is relatively small, but should experience strong future growth.

The UHF market is in its startup phase, notes He. "People look to the government's UHF timetable, but they neglect the fact that high costs, technological immaturity and unclear ROI inhibit the large scale application of RFID." Although open loop projects can't be realized because of pending frequency-related issues, manufacturers can still use closed loop systems to improve production or logistics/supply chain management.

ABI Research does not expect to see a national UHF RFID standard published in 2006. Whether ISO 18000-6 part-C will converge with EPC Gen2 will significantly influence the timing and shape of a Chinese standard.

Wal-Mart's mandate should be the major incentive for small and medium size Chinese manufacturers to use RFID, but ABI Research says its effect will be largely limited to export markets. The unanswered question is, according to ABI Research, when will Wal-Mart's direct suppliers be technically and logistically ready to integrate their Chinese suppliers in their RFID supply chain?