Qualcomm Seeks To Promote Cdma2000 Tech In Japan -Nikkei
Dow Jones News Service ~ April 14, 2000 ~ 1:39 pm EST
TOKYO (Nikkei)--Qualcomm Inc. (QCOM) is looking into entering the third- generation, or 3G, cellular phone market in Japan in order to promote its own cdma2000 technology, after having had its standard spurned by all three major domestic cellular phone service providers, The Nihon Keizai Shimbun reported in its Saturday morning edition.
NTT DoCoMo Inc. (J.NTX or 9437) and the nine J-Phone companies operating under Japan Telecom Corp. (J.JTC or 9434) have decided to employ WCDMA, or wide-band code division multiple access, technology if they are granted domestic 3G cellular phone licenses.
The soon-to-merge IDO Corp. and DDI Corp. (DDIC or 9433) also recently decided to adopt WCDMA, which was developed by NTT DoCoMo, L.M. Ericcson Telephone Co. ( ERICY) and others, despite the fact that they now use Qualcomm's cdmaOne technology.
The Ministry of Posts and Telecommunications, however, will grant 3G licenses to only three firms. Qualcomm aims to gather the support of the U.S. Trade Representative Office in its bid to provide 3G service here, so its appearance as a fourth applicant for the license is likely to pose another telecommunications-related problem for Tokyo and Washington to resolve.
Qualcomm is preparing applications for 3G and wireless licenses in Japan. In addition to cdma2000, Qualcomm will apply to use its HDR, or High Data Rate, wireless Internet access technology.
Qualcomm, which is strong in technology but not services, is expected to team up with a U.S. communications cellular phone service provider and hand in the applications by the May 12 deadline.
The Posts Ministry will grant 3G licenses based on the technological prowess of the applicants and their ability to operate communications systems.
Using a process already employed in Northern Europe, the ministry will examine each business plan to see who can roll out service the quickest.
But in vying to set up a business from scratch, Qualcomm appears to be lagging behind its rivals. Its "fund support is also unclear," notes an industry insider.
If Japan opts to only adopt WCDMA technology, then Qualcomm will lose a market for its cell phone chips. "The introduction of U.S. technology should not be impeded for no good reason," maintains Qualcomm Japan Inc. President Tetsuzo Matsumoto.
"If the DDI cellular firms and the IDO group pull away from WCDMA, there will be no need for us to enter the business," adds a Qualcomm Japan official.
The USTR is also said to be interested in the outcome of the Posts Ministry's selection process.
As a result, the selection could be a source of new trade friction between Washington and Tokyo, which are already embroiled in a dispute over connection fees charged by Nippon Telegraph and Telephone Corp. (NTT or 9432).
(END) DOW JONES NEWS 04-14-00
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