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China joins race to develop IOT standard

China suppliers have intensified efforts to develop an IOT standard, which they hope will be the benchmark for a global regulation. Presently, the lack of a unified standard and high chip costs are preventing mass manufacture of IOT products.

Still in its nascent stage, the Internet of Things industry has seen worldwide development gain pace in 2010. But widespread adoption does not seem likely in the near future, simply because a global standard is not yet in place.

China joins race to develop IOT standard
All of Haier's home appliances have been IOT-ready since 2005. Its first IOT refrigerator, however, was released in January 2010.

IOT refers to the networked interconnection of various devices and appliances. A unified regulation is necessary because devices need to follow one protocol to be able to work together and achieve intelligent control. The interface and chips have to be standardized. Without a global communications protocol, IOT product manufacturers will be unable to work with exchange operators and retailers. Such devices then would be no different from ordinary products such as conventional home appliances.

The US, the EU, Japan and China have all intensified efforts to come up with their own standard, which can then be the basis for a global regulation.

Several of China's largest export manufacturers have been in the IOT field since 2005, some even earlier. Home appliances, smart meters and electronic tags are just a few examples of products that have been built for networked interconnectivity. These companies formed a team to work on an Intelligent Grouping and Resource Sharing standard that could regulate IOT development.

The sooner they are able to come up with a domestic standard, the easier it will be to pitch said regulation for worldwide use. This can then reduce technical barriers for China suppliers, who also would not need to pay IP fees to organizations in developed countries.

The Midea Group and the Haier Group have both been able to develop core control chips and are now working on integrating the power grid with the intercommunication, Internet, radio and TV networks.

Haier has already received approval for seven industry and nine national IOT standards. It has also submitted applications for two international standards, of which one could be China's first in the home network field. The company has also applied for more than 1,000 patents for its IOT home appliances line.

Further, Haier is working closely with telecom operators, and radio and TV networks to include IOT in their product promotions. These operators then select companies that have significant investment in the IOT field such as ZTE and Huawei to work on developing the transmission network.

Imported RFID chips raise costs

Apart from the lack of a unified standard, cost is a factor limiting widespread adoption of IOT products. An IOT washing machine is estimated to be 100 percent more expensive than a conventional model. This is because such units adopt inverter technology, have a high-capacity inner barrel, are fitted with a computerized panel and motor, and incorporate imported chips.

RFID technology is key in IOT's progression. RFID chips account for one-third the cost of an RFID tag and are made mostly by foreign companies that have overcome technical difficulties, including power consumption, antenna emission and final sealing.

Very few domestic companies can make such chips. Midea has been able to develop core control chips and software, but still outsources RFID chips. Haier has likewise released several types of core control chips for various IOT products. In fact, its output of home digital chips exceeds 70 million units. But as with Midea, Haier does not make RFID chips in-house.

China, however, has been strengthening its capability to manufacture RFID chips for various applications. Shanghai, for instance, has an industrial park and demonstration centers, including the Shanghai RFID Demonstrations Center. Further, the Ministry of Science and Technology has published The Blue Book for China RFID Technical Development. But while there is growth in the industry, local RFID suppliers currently focus on the domestic market.

Manufacturing IOT products is not a problem as the processes are similar with those for conventional devices. Both Haier and Midea have launched IOT home appliances to the domestic market, targeting to export them in the years ahead. To this end, Midea has been working with GE in developing IOT washing machines, which are scheduled for mass production this year.

The washing machines are programmed to adjust energy consumption based on the current electricity grid situation and time-of-use price information. Once a unified standard is in place, the units will be able to connect with mobile phones, TVs, refrigerators and smart meters.

All of Haier's home appliances that were released since 2005 have a network interface. As such, these units can be converted easily into an IOT model simply by adding a wireless module. But the group's first IOT refrigerator was launched in January 2010, with help from a European designer. The refrigerator can monitor the freshness and provide nutritional information of the food stored inside. It can also be used to surf the Internet, place video VoIP calls and play videos.

The Hisense Group has launched its own range of IOT-ready multimedia refrigerators as well.

 


Note: This article "China joins race to develop IOT standard" was originally published by Global Sources, a leading business-to-business media company and a primary facilitator of trade with China manufacturers and India suppliers, providing essential sourcing information to volume buyers through our e-magazines, trade shows and industry research.

All price quotes in this report are in US dollars unless otherwise specified. FOB prices were provided by the companies interviewed only as reference prices at the time of interview and may have changed.

Disclaimer: All product images are provided by the companies interviewed and are for reference purposes only. Those product images featuring products with trademarks, brand names or logos are not intended for sale. We, our affiliates, and our affiliates' respective directors, officers, employees, representatives, agents or contractors, do not accept and will not have any responsibility or liability for product images (or any part thereof) which infringe on any intellectual property or other rights of a third party.

 

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