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Technology Stocks : The New Qualcomm - a S&P500 company
QCOM 174.01-0.3%Nov 14 9:30 AM EST

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To: Ramsey Su who wrote ()6/24/2000 1:25:00 AM
From: Ruffian  Read Replies (1) of 13582
 
Qualcomm drafts CDMA road map for China

SATURDAY, JUNE 24, 2000 12:05:00 AM EST

Jun. 23, 2000 (Electronic Engineering Times - CMP via COMTEX) -- HONG KONG - With
a handful of OEM agreements in hand and the backing of China's No. 2 telecommunications
carrier, Qualcomm Inc. has unveiled its road map to help Chinese manufacturers develop
code-division multiple-access (CDMA) network and terminal products.

San Diego-based Qualcomm made a series of announcements here at the CDMA World
Congress with an eye to boosting acceptance of the wireless technology in the world's
fastest-growing telecommunications market. Along with Qualcomm's announcement of
research and development agreements with eight leading Chinese manufacturers, China
Unicom said it will launch a trial next year based on Qualcomm's cdma2000 1x multicarrier
mode (MC) infrastructure.

Experts here predicted that China will open the door to CDMA technology and equipment
suppliers. But they said foreign suppliers need to fine-tune their strategies and strive for more
flexibility if they are to succeed in this huge market.

Qualcomm said it has completed the first two steps after reaching a framework agreement on
intellectual property rights with China Unicom and R&D deals with eight OEMs. Qualcomm's
progress here could awaken the CDMA market in China and generate future production
licensing and chip sales for the wireless company.

"But before producing licensing, we need to receive information from the government as to
which company can be licensed," Irwin Jacobs, Qualcomm's chairman and chief executive
officer, said during the CDMA conference. China's Ministry of Information Industry (MII)
determines which telecom manufacturers will get licenses.

With no indications yet about which companies will receive CDMA production approval from
MII, Qualcomm opted to establish a framework to help it transfer technology to Chinese
manufacturers through R&D pacts.

Qualcomm has 75 technology licensees around the world, including CDMA technology
licenses for 1x MC and wideband CDMA. Qualcomm's licensing policies for its intellectual
property have been similar regardless of which direction manufacturers have chosen.

Jacobs said Qualcomm will offer similar terms in China to help local manufacturers establish a
CDMA industry regardless of which CDMA formats the government selects for
third-generation (3G) wireless.

Besides cdma2000 and W-CDMA, MII's Post and Telecom Academy has developed a
time-division synchronous CDMA (TD-SCDMA) system that has been accepted by the
International Telecommunications Union (ITU) as a 3G standard.

Meanwhile, a Beijing startup said it has developed a large-area synchronized CDMA
(LAS-CDMA) system with a minimum of six times the voice capacity and five times the data
capacity of the IS-95 standard.

Chinese OEMs such as Zhongxing Telecom and Huawei Technology, both based in Shenzhen,
and Beijing-based Datang Telecom and China Post and Telecom Industry Corp. (PTIC) have
invested heavily in CDMA. Huawei announced recently that its CDMA system had passed a
comprehensive test conducted by MII. PTIC released its CDMA basestation months ago.

Zhongxing Telecom was scheduled to demonstrate commercial CDMA products, including a
CDMA basestation, mobile switch and CDMA handset, in Shanghai last week. The company
will base its systems on IS-95A/B and will demonstrate software to upgrade the entire system
to cdma2000 1x or 3x specs.

Industry watchers said the key to Qualcomm's success here is how well it times its entry and
how it handles technology transfers. Jacobs said the more Chinese companies that develop
CDMA technology, the better, but homegrown 3G CDMA standards and cooperation with
other chip makers could benefit China in the long run.

China has been a key market for Global System for Mobile Communications (GSM) systems
and handsets for years, but that market is dominated by such offshore powerhouses as
Motorola, Ericsson and Nokia. Local cellular phone producers hold only 2 percent of the
Chinese GSM handset market. Both the government and industry are thus looking for
opportunities and technologies to secure a foothold in comms.

Fabless semiconductor companies view China's push into CDMA as an opportunity.
Qualcomm CDMA Technologies (QCT) has become a one-stop supplier for China's
telecommunications OEMs. "We provide digital integrated circuits for baseband, IF and RF
integrated circuits; software to make handsets work; technical support such as application
engineering and test; and tools," said QCT president Don Schrock.

Schrock predicted that many of China's manufacturers will team with his company after the
Qualcomm R&D agreements take effect. He said QCT chips let manufacturers include such
multimedia features as MP3, MIDI Ringer, global positioning satellite systems and
high-data-rate abilities. QCT's chips will sample this fall, he said.

QCT received the Third Generation Pioneer award during the CDMA World

Congress.

Qualcomm chairman and CEO Irwin Jacobs waits for Beijing's decision on 3G formats and
manufacturers.

eetimes.com

By: Sunray Liu Copyright 2000 CMP Media Inc.
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