China's holding out for the U.S. Senate vote
andovernews.com
China Closer For Qualcomm, Already At European Players' Doorstep
(CT Wireless, Vol. 4, No. 103 via COMTEX) -- The only thing between Qualcomm [QCOM] and the Chinese wireless market is the U.S. Senate's approval of legislation knocking down trade barriers with China, but nothing stands between European telecom players and the resumption of investments in China Unicom.
The U.S. House last week approved a measure establishing permanent normal trade relations (PNTR) with China. The Senate is expected to consider the legislation next month.
Also last week, the World Trade Organization and China announced an agreement to add the country to the organization and grant it all trading rights enjoyed by other members.
In the United States, Qualcomm Chairman and CEO Irwin Jacobs backs granting PNTR status to China, and admits his preference isn't based solely on what's good for the entire wireless industry.
The Senate's "approval is key to expanding United States exports to China," Jacobs said. "PNTR is particularly beneficial to Qualcomm, reducing the prior uncertainty of Chinese government support for a major increase in the use of CDMA technology by China Unicom and possibly others."
Deploying CDMA networks using Qualcomm's technology across China most likely would boost the San Diego-based company's slumping stock value.
In February, China Unicom, the country's second-largest mobile service provider, and Qualcomm finalized a CDMA intellectual property rights framework agreement defining the guidelines and procedures for licensing Qualcomm's CDMA technology to domestic Chinese manufacturers.
However, the Chinese government the following week indefinitely postponed deployment of CDMA networks in a bargaining ploy to obtain support from U.S. lawmakers for China's entry into the World Trade Organization. Previously, China had ordered foreign companies to divest their interests in China Unicom.
Now that the WTO has embraced China, Deutsche Telekom [DT], France Telecom [FTE] and Telecom Italia can return capital to Unicom they previously invested before China ordered them to withdraw.
The WTO persuaded China to allow foreign operators a 25 percent share in all mobile telecom joint ventures upon China's formal entry into the organization. The investment percentage will rise to 35 percent in one year and to full minority ownership - 49 percent - in three years.
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I agree, Tom. In time, this manipulation of Qualcomm will be viewed as one incredible joke. It's painful now, though, for many of us. It just shows how much ambiguity and adversity a techno giant like Qualcomm indeed faces. Basically, it's damn hard to conquer the world. <ggg>
Just porchin'
John |
