Siemens would like to offer CDMA networks
BARCELONA, Spain, May 13 (Reuters)- German electronics conglomerate Siemens AG said on Monday it would like to offer a mobile phone technology which dominates the Americas and South Korea, but would not comment on rumours it might seek to buy a unit from Motorola <MOT.N> to achieve that goal.
U.S. giant Motorola, which said last week it wanted a partner for its mobile infrastructure business, offers the CDMA network technology that Siemens does not have at the moment.
Siemens Mobile Chief Operating Officer Lothar Pauly said CDMA and CDMA 2000 technology would be used in 20 or 30 percent of the wireless networks around the world, remaining a small challenger to the current standards GSM and new UMTS networks that will be used in the remaining 70 to 80 percent of networks.
"It's not a necessity (to have CDMA), but it would be nice to have it," he told investors at a conference organised by investment bank Credit Suisse First Boston in Barcelona.
He added Siemens was not going to develop the technology itself, which immediately raised questions if the German company was in talks to buy the unit from Motorola. Motorola and Siemens are already cooperating in mobile handsets, with Motorola providing Siemens with new third generation phones and chips.
"We're not going to develop CDMA. It would be crazy to spread our research and development on more than two technologies, GSM/GPRS and UMTS," Pauly said.
"I have no comment on rumours," he said in reply to the questions if it was interested to take over Motorola's unit.
MOTOROLA PHONES
Pauly also gave an update on the new Motorola phones Siemens will rebrand and sell as of the fourth quarter of this year.
The new dual-mode phones, capable of working on existing second generation wireless networks as well as soon-to-be-launched third generation (3G) networks that are designed for data communications, will come out of interoperability tests in June.
"They will be workable in a commercial way in the fourth quarter," Pauly said, putting the company on a par with Nokia <NOK1V.HE> and Sony Ericsson <ERICb.ST>.
He added a second 3G model, with all of Motorola's hardware inside, but designed by Siemens and with Siemens software inside, will come out in the third quarter of 2003. Siemens will move to its own model by early 2004 with only a Motorola semiconductor inside.
Pauly added he expected another 10 percent decline of the average price of its mobile phones this year, as the company continued to move to lower priced models for developing markets.
"Average selling prices might go down by another 10 percent maximum from now until Christmas. In the fourth quarter I expect an increase, not driven by (recovering) demand, but because several new handsets, that we have not yet shown, will come onto the market," he said.
Global mobile phone sales are expected to remain little changed at around 400 million units this year. Rapid growth has stopped in the wake of lower subsidies by operators and high penetration in developed markets, without new services to drive replacement sales.
Siemens sees continued growth in developing markets for which it produces cheaper phones of less than $100 on which it claims to achieve good profit margins. Pauly said the low-end market will be 40 percent of the global market.
Siemens is the world's fourth largest mobile phone maker with a market share of around eight percent, challenging the recently combined mobile phone operations of Sony and Ericsson. |
