March 11, 2004 – Wireless chipmakers Intel and Broadcom face being shut out of the China market by refusing to adopt a government-sponsored wireless data encryption standard.
Starting June 1, all Wi-Fi chips sold in China must include the locally developed Wired Authentication and Privacy Infrastructure (WAPI) standard, a deadline Intel claims it won’t meet due to differences between WAPI and existing Wi-Fi standards.
Intel, Broadcom, and others (including the World Trade Organization and SIA) also are crying foul because China’s Wi-Fi move — typically the jurisdiction of a standards body — would require them to partner with local companies for technology transfer, a policy that seemingly gives an advantage to domestic firms. “Such compelled investment would appear to be inconsistent with China’s WTO commitments,” according to a letter recently sent by US trade representatives to Chinese authorities.
China isn’t backing down, however. One official quoted by the Financial Times claimed that if Intel’s wireless Centrino chips don’t meet the WAPI deadline they’ll simply be banned from the market. “China is such a strategic market…I think Intel should calm down.”