China moves to upgrade parts ofCDMA network to 1X in a BIG, BIG hurry -- moving to release contracts without
going through the bid process. Aim is to be ahead of the 5/31 start of the World soccur finals. Also clearly they are
interested in moving on to 1X EVDO as ZTE has just signed.
ON TO 1X in A HURRY
China United Upgrades Network Amid World Cup Frenzy (Update1)
By Kenneth Wong
Beijing, April 22 (Bloomberg) -- China United Telecommunications Corp., scrambling to provide full-motion
videos on cell-phones in time for soccer's World Cup next month, hired Motorola Inc. and four other companies
without bidding to upgrade its network in seven big cities, a company official said.
China's second biggest mobile-phone operator also contracted Lucent Technologies Inc., Samsung Electronics Co.,
Nortel Networks Corp. and local ZTE Corp. for the system upgrade, said the China United official, who declined
to be identified.
China United and Hong Kong-listed unit China Unicom Ltd. are betting that showing the world's most-watched
sports event on mobile phones will boost use of their slow-growing $2.5 billion code division multiple-access
network.
``I was deeply impressed by the popularity of mobile Internet data in Korea and Japan,'' Wang Jianzhou, president
of both China United and Unicom said at a conference earlier this month. ``Given our similar cultures, I realize
there is a lot of potential in China.''
The quickly purchased new equipment will be installed by the May 31 start of the World Cup finals, being held in
Korea and Japan, for which China qualified for the first time. The upgrade makes data transfers 15 times faster,
allowing video downloads.
As of April 7, China United said the three-month old network had attracted about 800,000 customers, only about a
10th of a revised year-end target of 7 million. China Unicom leases and runs China United's CDMA network in 12
wealthier provinces.
Upgrade
The upgrade is the first leg of China United's plan to switch the nationwide CDMA network, based on technology
developed by San Diego-based Qualcomm Inc., to a faster CDMA2000-1X standard, already in use in Japan and
Korea.
The company is seeking to hold the cost of equipment for the nationwide upgrade to no more than 15 percent of the
$95 for every user capacity, or $1.5 billion, it spent on gear for the first phase. Analysts expect the change to cost
about $400 million.
By mid-May, the company will ask for bids for equipment for about 300 more cities, aiming to finish the upgrade
by the third quarter, the China United official said.
``We will invite all who have done trial runs for our 1X network to take part in the tender,'' Wang said in an
interview earlier this month. ``Other makers who haven't done trial runs will also be invited.'' He wouldn't
elaborate.
Seven Cities
China United last month slashed planned expansion of the CDMA network by as much as half after demand lagged
expectations. The company, will add capacity for at least 10 million additional users this year, rather than 20
million as previously planned.
In the new contract, Motorola will supply equipment in Beijing and Shenzhen, Lucent in Shanghai and Guangzhou,
Samsung in Tianjin and Shanghai, Nortel in Harbin and ZTE in Haikou. Motorola will demonstrate its Shenzhen
network on May 19.
Ericsson AB, the biggest maker of equipment for wireless networks, wasn't invited to participate in this round of
upgrades, the China United official said. The company sold $200 million of CDMA equipment to China United
last year and recently completed a trial of the upgraded system in Chengdu, Sichuan province.
China is the world's biggest wireless market, with almost all of the 156 million subscribers in the country using
the rival standard global system for mobile communications.
China Unicom shares fell 2.6 percent today to HK$7.40. The stock has dropped 14 percent this year. Shares of
bigger rival China Mobile (H.K.) Ltd. dropped 2.3 percent to HK$23.80. They have lost 13 percent in value this
year.
MOVING TO 1X EVDO too
SAN DIEGO & SHENZHEN, China--(BUSINESS WIRE)--April 22, 2002--
ZTE Becomes First Company in People's Republic of China to Enter into
CDMA2000 1xEV-DO Infrastructure Design Transfer Agreement
QUALCOMM Incorporated (Nasdaq: QCOM), pioneer and world leader of Code Division Multiple Access
(CDMA) digital wireless technology and ZTE Corporation, a leading manufacturer of telecommunications
equipment in China, today announced they have signed a CDMA2000 1xEV-DO design transfer agreement. Under
the terms of the agreement, QUALCOMM will transfer certain CDMA2000 1xEV-DO infrastructure designs and
ZTE will have the rights to utilize the transferred CDMA2000 1xEV-DO technology in base stations of its
soon-to-be-launched high-speed wireless Internet system. ZTE becomes the first company in the People's Republic
of China to enter into a CDMA2000 1xEV-DO design transfer agreement with QUALCOMM.
"ZTE continues to demonstrate its leadership in the CDMA market as it was the first manufacturer in the People's
Republic of China to enter into a CDMA2000 1xEV-DO design transfer agreement with QUALCOMM," said
Barbara Noerenberg, vice president of program management for QUALCOMM. "We are pleased to be working
with ZTE and look forward to working closely with them as they become a key player in the efforts to deploy
commercial CDMA2000 1xEV-DO products that enable advanced wireless data services in China."
"ZTE is pleased to establish this important relationship with QUALCOMM," said Dr James Jiang, general
manager of ZTE San Diego. "ZTE believes that CDMA2000 1xEV-DO is one of the best technologies to support
China's growing need for high-speed wireless Internet access. QUALCOMM's CDMA2000 1xEV-DO reference
design will significantly accelerate ZTE's trial and commercial system development."
CDMA2000 1xEV-DO enables "always on" data to be sent over PCS and cellular wireless networks at speeds
comparable to DSL or cable modems, at a lower cost-per-byte than any other 3G technology in development
today. CDMA2000 1xEV-DO provides peak data rates up to 2.4 Megabits per second (Mbps), which supports
demanding applications such as streaming video and large file downloads.
ZTE Corporation is China's largest listed telecom manufacturer and one of the leading communication solution
vendors in the world. Founded in 1985, ZTE was listed on the Shenzhen Stock Exchange in 1997 and achieved
US$1.23 billion in contracted revenue in 2000. As a pioneer and leader in development of telecommunications in
China, ZTE provides equipment for switching, mobile and data communications, optical and access networks, and
videoconferencing. Turnkey networking solutions for setup, refurbishment and optimization of networks are also
offered.
QUALCOMM Incorporated (www.qualcomm.com) is a leader in developing and delivering innovative digital
wireless communications products and services based on the Company's CDMA digital technology. The
Company's business areas include CDMA chipsets and system software; technology licensing; the Binary Runtime
Environment for Wireless(TM) (BREW(TM)) applications platform; QChat(TM) push-to-talk technology;
Eudora(R) e-mail software; digital cinema systems; and satellite-based systems including portions of the
Globalstar(TM) system and wireless fleet management systems, OmniTRACS(R) and OmniExpress(R).
QUALCOMM owns patents that are essential to all of the CDMA wireless telecommunications standards that have
been adopted or proposed for adoption by standards-setting bodies worldwide. QUALCOMM has licensed its
essential CDMA patent portfolio to more than 100 telecommunications equipment manufacturers worldwide.
Headquartered in San Diego, Calif., QUALCOMM is included in the S&P 500 Index and traded on The Nasdaq
Stock Market(R) under the ticker symbol QCOM.
Except for the historical information contained herein, this news release contains forward-looking statements that
are subject to risks and uncertainties, including QUALCOMM's ability to successfully design and have
manufactured significant quantities of CDMA components on a timely and profitable basis, the extent and speed to
which CDMA is deployed, change in economic conditions of the various markets the companies serve, as well as
the other risks detailed from time to time in QUALCOMM's SEC reports, including the report on Form 10-K for
the year ended September 30, 2001, and most recent Form 10-Q.
QUALCOMM, OmniTRACS, OmniExpress and Eudora are registered trademarks of QUALCOMM Incorporated.
BREW and QChat are trademarks of QUALCOMM Incorporated. Globalstar is a trademark of Loral
QUALCOMM Satellite Services, Incorporated. All other trademarks are the property of their respective owners.
--30--ts/sd* js/sd
CONTACT: QUALCOMM Incorporated
Patty Goodwin, Corporate Public Relations
858/651-4127, Fax 858/651-5873
publicrelations@qualcomm.com
or
Julie Cunningham, Investor Relations
858/658-4224, Fax 858/651-9303
jcunningham@qualcomm.com
or
ZTE Corporation
Feng Jian Zhou, Public Relations
86-755-679-0285, Fax 86-755-679-0286
feng.jianxiong@mail.zte.com.cn |
