According to a recent report, the Chinese RFID market reached CNY 226 million in Q2 2005, more than twice as much as the same time last year, displaying a rapid growth in Chinese RFID market.

The report prepared by Analysys shows that that the government plays an important role in driving the development of the Chinese RFID market. Government-related applications account for the largest share in the RFID application fields.

But RFID development is still restricted by many factors, including sustained high costs, lack of a unified standard, immature supply chain and supporting links among others. All these problems are still unsolved, which creates a large bottleneck for large-scale acceptance of RFID.

The nationwide launch of second-generation ID cards is the most important reason for this year's rapid growth. Second-generation ID cards and related products share 38% of the total market. In addition RFID technology reached a good momentum in fields where it is already applied on a large scale, such as public transportation, campus management, property/residential area management etc.

Meanwhile, structural change in application fields also modifies percentage of RFID products in each frequency band, among which the high frequency products, represented by 13.56M for the second generation ID cards, increased largely by this amount. While low frequency products, comparatively more mature in application, keep a relatively stable growth. The ultra-high frequency products, quite small in terms of percentage, are adopted for application gradually, based on advancements in high speed and long distance recognition.