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Technology Stocks : Ericsson overlook?
ERIC 9.600+0.5%Nov 28 9:30 AM EST

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To: DWB who wrote (1686)6/8/1998 8:31:00 PM
From: Caxton Rhodes  Read Replies (2) of 5390
 
To anyone who ever wonders why qcom despises ericy's business, political and projectionist policies, this is a prime example. The chip rate doesn't matter except to exclude backward compatibility with cdmaOne. But hey business is business as they say........... We shall see who wins, those with the brains, or ericy. I hope the inevitable qcom license fee for ericy is high high high.

Caxton

Japan to submit one 3G standard: W-CDMA

By Lynnette Luna

Wideband cdmaOne will play a small part in the proposal Japan's standards body will submit to the
International Telecommunications Union as a third-generation technology choice.

The Association of Radio Businesses and Industries, ARIB, has been trying to converge wideband
Code Division Multiple Access technology, based on the GSM platform, with the W-cdmaOne
proposal, but has run out of time trying to iron out the technical differences, say sources in Japan.
ARIB must submit a proposal by June 30.

''We expected both to be submitted,'' said Anil Kripalani, vice president for global standards
planning with Qualcomm Inc., which has been a vocal advocate of converging the two CDMA
proposals. ''What they chose to do was submit what they had originally, and left ours in as
secondary options. They have decided to submit their proposal with their set of parameters called
'working assumptions,' but have left the door open for further discussion.''

ARIB already was working with the W-CDMA proposal NTT DoCoMo, Japan's largest cellular
carrier, submitted when it invited a cdmaOne group-which included vendors Qualcomm, Lucent
Technologies Inc., Northern Telecom Ltd., Motorola Inc., Sony Electronics, Hyundai Electronics
and Lucky Goldstar-to submit its proposal. Sources say ARIB worked hard at trying to converge
the two, but the influence of DoCoMo and L.M. Ericsson won out. Officials at ARIB could not be
reached for comment, despite repeated attempts.

The same technical issues that have popped up in standards bodies around the world plagued the
process in Japan, say sources. Convergence advocates and W-CDMA backers, namely L.M.
Ericsson and other European vendors, have been arguing over the chip rate and other relevant
technical issues without any compromised result. The issue has become extremely political, with
both sides accusing each other of trying to gain the upper hand to preserve their current investments.

One primary sticking point is the chip rate. The cdmaOne camp says the chip rate must be 3.6864
Mcps, which will allow for backward compatibility and improvement in performance. The
W-CDMA camp won't go below 3.8 Mcps, saying a lower chip rate degrades the proposal.

''A poll of the majority of members of the coordinating group indicated that they didn't care if the
chip rate was changed to the 3.6 rate cdmaOne was proposing. Even after that, we were not
successful in getting them to change,'' said Kripalani. ''An ARIB Ad Hoc group did nothing but
examine the technical impact. The group came back and reported there is no impact or detrimental
impact to 3G. Even after that, the number will not change.''

''DoCoMo has said that if you can get the Europeans to change, then we will change,'' said one
industry executive.

Sweden-based Ericsson consistently has decried cdmaOne technology and is the only major
manufacturer that has refused to license cdmaOne. DoCoMo's influence on technology decisions in
Japan is large. Several years ago, DoCoMo began experimenting with next-generation technology
and invited vendors from around the world to participate, and Ericsson took the lead, while
Qualcomm lacked the resources at the time to participate.

Last year, Ericsson along with Nokia Corp. and Lucent Technologies Inc., announced DoCoMo
selected them to construct a third-generation network incorporating W-CDMA technology that will
offer commercial service by 2000. A test system should be rolled out this year.

Since then, DoCoMo has made technical contributions to the European Telecommunications
Standards Institute, which already has selected the W-CDMA proposal, and has signed a
memorandum of understanding with the GSM MoU Association to develop Global System for
Mobile communications technology as the core network technology for third-generation services.

''If any modifications will be made, it depends on how DoCoMo sees it,'' said Kripalani. ''We are
hopeful they will be encouraged to change. We continue to work on this. No one is interested in
having multiple standards.''

DoCoMo could not be reached for comment.

The debate over third-generation standards will be far from over on June 30. Qualcomm has made
known that it owns key intellectual property rights to CDMA technology, regardless of the
bandwidth and has indicated it will only license the technology if W-cdmaOne is converged with
W-CDMA. Since it is running out of time, ARIB for now is not taking the IPR issue into
consideration, said one source in Japan.

Qualcomm also has notified ETSI of its IPR position. The European standards body so far has
resisted efforts to converge the two cdmaOne proposals, and it is unclear what steps it will take to
leave the proposal open to cdmaOne. Ericsson has a strong influence in Europe, say industry
watchers. An official at ETSI declined to comment on the situation, saying the issue was ''extremely
delicate and sensitive.''

''Ericsson seems to think they have a fallback position if push comes to shove, and they may be
able to get around the [IPR] issue. It's an extremely sensitive situation,'' said Patrick Donegan,
analyst with the Yankee Group in the United Kingdom.

Qualcomm said it is looking at whether Ericsson is violating any of its patents in constructing
DoCoMo's network.

Why ARIB wants to submit only one proposal is unclear, especially when the government mandated
the use of cdmaOne technology last year for second-generation systems. Cellular carriers DDI and
IDO will be launching commercial cdmaOne networks soon and have commissioned Motorola and
Lucent to construct a test W-cdmaOne network.

But Japan wants to play a significant role in the global scene for third-generation technology, and
has more to gain than anyone else in seeing a true world standard emerge, say some. It has isolated
itself in the past by deploying a digital standard incompatible with the rest of the world's standards,
so Japanese manufacturers have been limited in providing infrastructure worldwide.

The ITU is looking to institute a single world standard that would provide for global roaming and
high-speed data services, among other things. Korea and the United States are expected to submit
more than one proposal by June 30.
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