Bruce Einhorn weighs in from Hong Kong for BusinessWeek on how the Chinese efforts to require their own, proprietary flavor of Wi-Fi security will fail: Einhorn notes that the effort is a clear violation of World Trade Organization rules, a group which China battled long and hard to join. The US Information Technology Office also believes that allowing a private, closed encryption standard to be allowed in this restrictive manner would open the door to future such efforts. A similar effort in the 1990s to require a certain form of PC software encryption failed for similar reasons, Einhorn notes.
One piece missing from his analysis is the refutation that this is a security issue. All of the officials and companies involved with the Chinese standard keep beating that drum. It should be clearly stated that the security issue has been put to bed with WPA, 802.11i (upcoming), and 802.1X. There's no reason to develop a closed standard in the first place--it ensures failure because encryption standards that aren't widely tested are almost uniformly crackable. It also reinforces my contention that WAPI almost certainly has a built-in government backdoor to the encryption protocol to allow simple monitoring.
Coverage from the People's Daily, the official Chinese government newspaper, notes at the end that Intel's refusal to comply with Chinese rules may offer AMD an opportunity in the market. AMD doesn't sell an integrated Wi-Fi solution, which makes it less of a direct conflict for them.