ROK Firms to Manufacture Mobile Phones in China
Korean mobile phone manufacturers are preparing for the construction of their
factories in China to roll out code division multiple access (CDMA) handsets ahead of
the Chinese government's formal approval.
The South Korean Ministry of Information and Communication has already drawn up a
shortlist of companies that it favors for such business, and those companies are now
waiting for the official go-ahead from Beijing, expected to be issued around November.
Samsung Electronics reported that it has agreed to a business cooperation arrangement
with Keijian, a Chinese firm, for the transfer of CDMA technology.
``The final decision is pending on the approval of the Chinese government,'' said a
Samsung official. The company also set up a CMDA2000- 1X mobile phone production
line. That is a migration technology, commonly called 2.5G, on the way to full
third-generation (3G) telecommunication services.
Last April, Samsung won from China Unicom, the second-largest mobile carrier in the
country, the contract to sell CDMA equipment in the cities of Shanghai and Tianjin and
the provinces of Fujian and Hebei.
LG Electronics, currently operating research and development facilities in the mainland,
is also planning to invest $30 million to establish mobile phone production lines as soon
as the Chinese government allows such factories.
``Our factory will be able to produce more than 200,000 CDMA-based handsets per
month,'' said an LG spokesperson.
Hyundai Quritel, a small mobile phone maker, is now negotiating with a local partner to
set up production lines that will be capable of manufacturing 2 million phones per year.
Such decisions by mobile handset makers to move manufacturing to China are
quintessential of the steps being taken to move beyond the domestic market, which has
reached its mobile phone saturation point.
China, which could become the largest mobile communication market in the world with
an estimated worth of $50 billion, is also vital to companies experiencing difficulties with
the global economic slowdown.
Still, the vast majority of China's 80 million existing mobile phone users are connected to
networks based on global system for mobile communications (GSM), a more common
technology that is a rival to CDMA.
Over the next four years, China Unicom is expected to secure more than 70 million
CDMA mobile phone subscribers. Unicom is to spend about $1.81 billion on such
projects.
kdh@koreatimes.co.kr
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