China Mobile reportedly is delaying deployment of an RF-SIM contactless-payment technology based on a standalone 2.4-gighertz frequency and instead is adopting SIMpass, a contactless card that uses a 13.56-megahetz radio frequency and that is fully compatible with the widely accepted Near Field Communication standard.
China Mobile, China's largest mobile-network carrier, has not officially announced the change, news of which came from local media channels.
Jiang Lixin (Jiang is the family name), an analyst at Shanghai-based research firm iResearch Consulting Group, tells PaymentsSource the move does not surprise him. The RF-SIM standard “is not widely accepted in the country, so China Mobile would have to invest in the whole supply chain to support the service,” he says.
China Mobile spent more than 100 million yuan (US$14.6 million or 12 million euros) buying the first batch of RF-SIM cards during the first quarter, and local media estimate it would have to invest another 400 million yuan to buy cards and to deploy exclusive RF-SIM point-of-sale terminals throughout the nation.
In May, Huang Gengsheng, a China Mobile senior project manager, said at a conference in Beijing that the company never had planned to give up the 13.56-megahetz standard. “2.4-gighertz is just an option. We wouldn't insist if it couldn't be taken as a national standard,” he said.
Both China Unicom, a longtime rival of China Mobile, and China Unionpay have adopted the NFC standard, which has been used widely in China's public-transportation systems, social-insurance networks and gas stations.
But it is still too early to assert that China Mobile has failed to promote RF-SIM technology given the company's huge user base, Jiang says.
China Mobile says it had more than 546 million users as of the end of March.