Hang In There Mates, I Smell A Victory Soon>
Europe and US row over new mobile phones
The Independent - London
THE GOVERNMENT'S plan to auction the
next generation of mobile- phone licences next
summer is facing serious delays, following a bitter
row about the technology to be used in the
phones.
The dispute is threatening to wreck the Government's plans to make Britain
the first country in the world to introduce the new mobile phones, which will
be able to show live videos and access the Internet at high speeds. It also
means the Treasury will have to wait longer than expected for the estimated
pounds 1.5bn the auction is likely to raise.
The row, which is threatening to turn into a fully fledged trade war between
the US and Europe, centres on rival technological standards that have been
developed for the phones. The first, called W-CDMA and produced by
Ericsson, has been adopted by the European Telecommunications
Standards Institute, the industry body.
However, [ Qualcomm ] , the aggressive US manufacturer, claims it owns
the intellectual property on which W-CDMA is based. Qualcomm is
promoting a rival standard, called CDMA2000, which it argues is further
advanced.
The outcome of the debate will decide whether the US and Europe will
adopt incompatible standards or whether the phones will be able to work in
both continents. Mobile phone operators in the UK are reluctant to take
part in the Government's auction until the row is cleared up. "It's clear that
we aren't going to commit to bidding until we fully understand what the
standards are," one operator said yesterday.
The Government had been hoping to invite bidders early next year before
holding the auction in May or June. But that timetable now looks optimistic.
Yesterday Dr Pekka Tarjanne, secretary-general of the International
Telecommunications Union, the global industry body which has the final say
on standards, said a compromise could be thrashed out by the end of
March.
"I am optimistic we can see convergence towards one global standard.
Some understanding has been shown of the need to have a framework," he
said.
However, he was contradicted by Sven-Christer Nilsson, chief executive of
Ericsson, who said: "I don't think we will see a full convergence of
standards. But we will see a way of existing together and permitting both
standards."
This puts Ericsson on a collision course with Qualcomm, which will only
release its patents if a single, compatible standard is agreed. "We will only
license for a converged standard," said Bill Bold, Qualcomm's vice-
president in charge of government affairs.
Ericsson claims its technology does not infringe Qualcomm's patents, and is
planning to bring the matter to the courts in April next year.
Meanwhile, the issue is in danger of spilling over into a trade row between
the US and Europe. Charlene Barshefsky, the US trade representative,
warned earlier this year that she would invoke the World Trade
Organisation if European manufacturers appeared to be protecting their
markets by adopting different standards.
(Copyright 1998 Newspaper Publishing PLC)
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Publication Date: December 03, 1998
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