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Technology Stocks : Interdigital Communication(IDCC) -- Ignore unavailable to you. Want to Upgrade?

To: Wayne who wrote (3733)	2/3/2000 4:38:00 PM
From: D.J.Smyth	Read Replies (1) \| Respond to of 5195

Wayne, "but I was somehow under the impression that the view of the thread was that China/Unicom would not go CDMA. I assume my belief was wrong, but I was wondering if anyone had a good feel for how the TDMA vs CDMA debate is likely to play out. QCOM makes it sound like its a done deal and CDMA will own China. A blow to IDC if true." Wayne. It has ALWAYS been the intent of Unicom to add CDMA to it's portfolio of products. I never read anyone saying anything else. Currently Unicom is 100% GSM. Unicom needs a common air interface to help distinguish it from China Telecom (NYSE:CHI) and attempt to gain market share. Unicom controls about 3% of mainland China's market (with 90% of that 3% in ONE prefecture), China Telecom controls the other 97%. The three problems facing Unicom in any buildout, be it GSM, TDMA, or CDMA and they are: (a) they don't have the capital to buildout a CDMA structure, (b) they don't have the internal business infrastructure to buildout to other provinces, and (c) GSM remains 100% of Unicom's current revenue base. Now how can this be a blow to IDC? IDC's technology is already being used in China in the Guangdong province by Unicom (a broadband WLL system). Unicom could as well buildout this system as narrowband CDMA. The fact is they needed approval by the Chinese Govt. for both WLL B-CDMA and CDMA and they got it. The press heard about Unicom getting the narrowband approval - but they didn't hear that Unicom was also requesting broadband WLL approval (with Samsung), and they got that too. China Telecom hasn't given much indication that it is interested in CDMA, other than W-CDMA which it is testing in two provinces, one test with Nokia (in which IDC is involved). China Telecom has already agreed to abide by all the standards set forth by the ITU in relation to paying royalties per the 3g platform. China, as a nation, is also in discussions with TDMA vendors to buildout to rural China where TDMA could be a less costly alternative mobile technology. They're already using GSM, which is a TDMA format, and they're also reviewing TDMA as an alternative - in much the same way that Latin America has been viewing it. However, I do believe that one reason China likes narrowband CDMA and/or WCDMA is the security it provides; it takes time to break down a WCDMA intercept to decipher a call. But, this is just one small benefit.

To: Wayne who wrote (3733)	2/3/2000 7:53:00 PM
From: JP Sullivan	Read Replies (1) \| Respond to of 5195

Don't know if you have been following the Nokia thread, but there are a number of good, recent discussions concerning China Unicom. To suggest that "CDMA will own China" is sweeping and premature, IMHO. China Unicom is by no means the dominant player in the country's mobile telecom market. The big gun is China Telecom, and it is a GSM/TDMA operator. For numbers, look through the Nokia thread. There are reasons, economic and technical, to believe that for 2G/2.5G at least, GSM will continue to proliferate since there are no significant advantages to users to switch to CDMA. As far as new users are concerned, they'll probably pick the cheapest phones / plan, and my guess is that GSM operators have the advantage there since they have been in the market longer and will have depreciated much more of their capital costs than will have operators with newly installed CDMA equipment. Furthermore, there are actually two CDMA standards being prepared for 3G, namely, CDMA 2000, which is QCOM's and WCDMA, which is supported by Nokia and Ericsson. So, who knows which one will eventually prevail in China. Nokia is already very established in the country and I expect it to be pushing for WCDMA when the time is right. Finally, even China Unicom operates a GSM network, and as long as it continues to make money for them, I think they'll stick with it. So, why CDMA (specifically, QCOM's CDMA) in the first place? I have found at least two reasons: 1) to placate the US so that China can enter the WTO; and 2) money from QCOM (apparently Q is funding China Unicom's buildup of its CDMA network--not sure how that works exactly). "QCOM makes it sound like its a done deal..." Well, what can one expect? I'm not criticizing QCOM here, but I am saying that it is to the company's advantage to paint a rosy picture. Even if the deal were really done, it remains to be seen how quickly China Unicom will build its network and switch over from GSM.