Where to start? China? Well, it was a very rough year. Initially 19 manufacturers were allowed to make CDMA phones, BUT none of these manufacturers had the ability to make any phones. Remember that 92% of CHina GSM is from foriegners and one of the key selling points for CDMA in China was the ability for them to get a better telecom share of the market. Then the problem happened.
Contrary to popular belief and media reports, there was never a problem with the network in CHina. The problem was that 18/19 manufacturers went to inexpensive Korean design houses for their phones. Why was this a problem? Well, CHina is similar in size to the US and with a new network in place, the RF requirements were quite high; however, most Korean designs were geared toward domestic Korean use where there is a basestation on every building and RF requirements are much smaller. Ever wonder why Korean phones are so small and US CDMA phones are bi and 30% more expensive? Well, there are 25+ design houses in Korea, yet only Samsung and LG sell product here in the US. The rest can't get certified. Long story short; the initial CDMA phones in China were pieces of crap. CU was in a bind because they could not have such negative performance with their initial rollout and they had not done a very good job (this was QCOM's fault) of setting up test proceedures to certify new phones. Unicom went to Samsung and two other well known companies to get 'good' performing product. In all, this caused a 6 month delay in the rollout of CDMA in China.
Since that time, Unicom has created a certification system, purchased phones from outside vendors and the 19 Chinese manufacturers have started to change partners. In the past 3 months, we have started to see the foundation being built that we had hoped for in March. Over 3M subs and growing by 12-20K per day. Most likely hit 4-5M by years end and most likely add 8-10M in 2003. JMHO. Upgrade to 1x network will be 6 months after the announce when the conversion will take place ALTHOUGH, CU is requesting all handsets sold be 1x compliant so this will continue to booster Q ASIC sales (1x chips have much higher margin).
The Chinese subsidies will continue to fuel the base of CDMA phones in CHina. It is imperative that they reach their 15M unit goal by the end of next year. |
