REALITY CHECK: A place at the table

REALITY CHECK: A place at the table

Today's reality of no American-made cell phones, or televisions, or air conditioners (need I go on?) points to an even larger trend than the globalisation of world markets.

The countries that make these and many other products - such as China, Japan, Korea, Malaysia, and Mexico - now say they want a place at the table when global economic powers meet to set technology standards. They understand that, somewhere down the road, technology has an economic impact.

The battle over RFID standards is a perfect example. RFID deals with the most mission-critical of business activities, such as moving boxes and supply chain.

Messing with that infrastructure directly affects a corporation's revenues.

"This is no place to experiment," program director at Meta Group, Bruce Hudson, said. "Not in the core operational processes."

And yet, even as RFID is being actively deployed in countless industries, there remains a worldwide debate over competing standards: EPCglobal's UHF (Ultra High Frequency) Generation 2, the ISO standard, Japan's UID (Ubiquitous ID), and China's NPC (National Product Codes).

Each of the RFID standards has the same three components. Content is the first. It defines how a product is identified: "I am this thing, a pallet of Diet Coke." Next is the air interface, which is the communications protocol between the tag and the reader.

Finally, something called the ONS (Object Naming Service) provides detailed product information. I'll save ONS for a future column.

For now, the biggest standards battle involves the air interface protocol and the content on the tag. It's a battle that is far from over, and if you choose sides too early, it might leave your company with lots of useless technology.

If China and Japan insist on keeping their own air interface protocols, UID and NPC, then companies that trade with Asia may find themselves deploying costly multi-protocol readers to handle tags using the disparate standards.

Hudson is a big-picture guy, so he downplays the significance of this problem, saying that in the short term there may be "some disruption" on the reader side and there may be a "slight" issue of royalties if the Chinese government wants to impose royalties for the use of their technology. Those spending the money may think differently than Hudson.

Content standards pose a bigger problem. China says EPCglobal - an entity based largely in the United States and Europe - is dictating what the content of RFID tags will be.

It's an issue of national security, according to Chinese officials. China feels threatened by the idea that anybody along the supply chain could examine their industrial output, capacity, and the whereabouts of goods at a granular level, in near real time.

But there is a larger story here. As much as we would like to say that the best technologies should be deployed unsullied by economic considerations, the Chinese and others understand that is often not the case.

Frankly, it's hard to imagine that EPCglobal would propose a standard that didn't conform to the larger technology architecture prevalent in the major Western companies that EPCglobal represents. But that standard may well ignore the needs of Asian companies.

With Asia's growing economic clout as a producer and consumer, it might not be a bad idea for standards bodies in general, and EPCglobal in particular, to wake up and smell the coffee.

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