JGoren and all,
Can QCOM really afford to lose the Chinese market? Business vs. Pride and political factors. So far Nokia still wins with being political neutral. Time is running out for Q on 2G. May be 3G will help. That is a long way to come though. I think Dr. IJ and teams should make a deal instead of waiting for a better deal if political reasons are not in play here.
The following article is from Chinaonline.com,
Will China Have A Quarter Billion GSM Customers?
By Edward C. Lanfranco
On September 1 this year, GSM mobile phone users making a call in China have been required to press an additional button -a zero- after the third digit. While this has been treated as a non-event, a minor irritation at most demanding new name cards and reprogramming callers stored in memory, the move from ten to eleven numbers portends far reaching implications in China's cellular industry.
It became apparent in late 1996 that GSM had been chosen as the de facto technical standard for China's mobile telephony. The country's initial analog systems were being supplanted by GSM which offered greater call capacity and clarity.
The keys to widespread acceptance of GSM were comprehensive technology transfers and the establishment of manufacturing facilities on the mainland. In order to keep pace with the country's rapid mobile subscriber development of nearly a million sign ups each month, the MII opted to dramatically increase the number base available for its digital GSM network.
Plans for adding another digit to GSM numbers first came out in September 1998.
The timing for program implementation was not known at that time. The project for lengthening the GSM phone number was designated "13S0." The letter "S" in the third spot refers to the digits between 5 and 9 used in China Telecom's GSM phones.
The plan did not initially encompass China Unicom subscribers, however they too have fallen in line employing the extra zero. The 13S0 project was undertaken based on the premise of a 60% utilization ratio. This meant the old ten digit GSM telephone number resource could support only 27 million users.
China Telecom estimated the number of subscribers in its GSM network would reach 28.1 million by the end of the century. The China Mobile Telecommunications Group, one of four entities created with the putative breakup of China Telecom, said there were over 32 million mobile subscribers in the country by the end of July 1999.
Estimates are that over 80% of cellular subscribers today, representing more than 26 million users, are on GSM systems. Work on the additional digit program was jointly designed by the Shanghai Long Distance Telecommunication Bureau and Beijing Post & Telecommunication Design Institute, which stated the number source on GSM networks would increase by 400 million.
Using the 60% utilization rate, the eleventh digit means that China's GSM system will now be able to accommodate an additional 240 million cellular subscribers. The country is positioning GSM as the mobile phone for the masses.
Some analysts believe this does not augur well for the potential of CDMA in the China marketplace based on the following factors:
ú Extensive investment by former provincial and local MII units in GSM technology dampens the willingness to undergo a fresh round of spending on new systems;
ú Growing domestic manufacturing capabilities for production of GSM infrastructure and handsets; ú Familiarity with GSM systems among telecommunications line technicians in China;
ú Lack of confidence among decision makers that CDMA is necessarily the best technology to compliment China's already substantial GSM mobile subscriber base;
ú Continued GSM purchases by China Unicom despite promised adoption of CDMA. The China Mobile Telecommunications Group, one of four entities created with the putative breakup of China Telecom, said there were over 32 million mobile users in the country by the end of July 1999.
Estimates are that over 80% of cellular subscribers today, representing more than 26 million users, are on GSM systems. Predictions for reaching the maximum subscriber base with ten digits seems likely to occur before the year 2000.
China's technical elite deserve praise for anticipating and addressing the predicted number shortfall in a timely fashion as well as being able to implement a solution that thus far works.
After being in use for a month and a half, no one in industry circles has reported problems with the transition to eleven digits. This is worth monitoring for the sustained long term health of GSM development. If no serious problems arise, this mobile system will maintain its dominance through the first decade of the next century.
It may turn out that the extra zero of September 1999 meant the start of something big.
Brian H. |
