Qualcomm's Irwin Jacobs: Closer to a Cellular Standard for
China
DECEMBER 20, 2000
NEWSMAKER Q&A
The CEO talks about Beijing's approval of his deal with China Unicom and the drive to make CDMA a global
mobile-phone standard
After months of wavering, the Chinese government in early December finally approved plans by China Unicom, the
country's No. 2 mobile provider, to test a cellular standard developed by Qualcomm Inc. of the U.S. If adopted, the
standard, known as code division multiple access (CDMA), could become dominant not just in China -- the world's
fastest-growing mobile-phone market with some 65 million subscribers -- but in Europe and the U.S. as well (see BW
Online, 12/20/00, "Why Qualcomm Is Bucking the Bear")
The emergence of CDMA as the probable global standard certainly pleases Irwin Jacobs, chairman and CEO of
Qualcomm. During a visit to the ITU Telecoms Asia conference in Hong Kong, he spoke about the future of CDMA, a
technology he spearheaded, with Irene M. Kunii, Tokyo correspondent for Business Week. Here are edited excerpts of
their conversation:
Q: What's next for CDMA in China?
A: The next step is for Unicom to be placing orders with manufacturers to build out infrastructure, and then there will be a
market.
Q: Will you be collecting royalties, and if so how much?
A: Yes, there will be some royalties, in the low single digits. But it's our policy not to disclose figures.
Q: In the competition for the third-generation system, you seem to favor CDMA2000 over wideband CDMA,
the standard developed in Japan on the basis of Qualcomm's CDMA technology. Why is that?
A: You have to ask which is earlier to market, has the best technology, and is cheaper to roll out. My answer is
CDMA2000. [The forerunner to] CDMA2000 is already in operation in Korea, so it has gone to market a year earlier than
wideband CDMA [which is scheduled to debut in Japan in May]. Also, the equipment will be cheaper because you'll be
able to build on the existing system.... For GSM [global system for mobile communications] operators, it's cheaper and
faster to do CDMA2000. They'll be able to do it a year or two earlier.
Q: But many operators appear to be veering to wideband CDMA. How do you explain this?
A: They've been told it's an evolution of GSM, but that's not right. They think it'll be out in 2001, but it may be later. Now
that the license auctions are over, operators have to think what is the fastest way to move ahead. I think CDMA2000 is the
better one.
Q: What kind of applications can we expect with next-generation wireless networks?
A: With a transmission speed of 64 kilobits per second, you'll be able to handle videoconferencing. But the issue is: How
many subscribers can you handle? Going to CDMA will help you handle more. Also, you'll be able to plug your computer
into a wireless network, so you'll be able to go online anywhere and anytime. We're working on chips that support the
CDMA2000 technology. For example, we're working on adding GPS [global positioning system capabilities], so your
phone will know where it is. It'll be useful in emergencies and will also provide for interesting e-mobile applications. You'll
be able to download maps, for example.
Q: What do you think of what NTT DoCoMo is doing with i-mode, its mobile Net-access service? It may be
slow, but it's very popular.
A: I-mode is a good marketing approach and represents a great business plan. Some of the types of services will be useful
as we move forward.
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