To: S100 who wrote (82839 ) 10/10/2000 9:10:43 AM From: S100 Read Replies (1) | Respond to of 152472 Domestic firms boost efforts to enter China's CDMA mobile phone market With signs growing that China may adopt CDMA wireless technology, Korean wireless equipment makers are accelerating their efforts to enter the world's second largest mobile market. In a recent interview with a Korean daily, Chinese Prime Minister Zou Rongji hinted that China's state-run telecom carrier may opt for the CDMA wireless standard, in which Korean firms have a competitive edge in handsets and network systems. In the strongest signal of late that China is leaning toward CDMA, Zou and China's chief telecom regulators reportedly met last week with Irwin Jacob, chief executive of Qualcomm of the United States, which pioneered the technology and makes money from royalties on handsets and equipment. The Chinese leader is to discuss the issue during a summit meeting with President Kim Dae-jung when he visits to attend the ASEM (Asia-Europe Meeting) Summit Oct. 20-21. It is still uncertain how the issue will be settled in the meeting, given the inconsistencies in the stance of China on the wireless standard, which have long made Korean telecom equipment makers nervous. But company officials expect that the discussion will be in a direction favorable to their business in China. China uses GSM (global service for mobile communication), a European standard competing with the U.S.-developed CDMA, for the vast majority of its wireless networks. The nation will soon run out of available frequencies with nearly 10 million new users signing up every three months. Its mobile user base expands 28.6 percent per year, outpacing that of convention phone subscribers which grow 16 percent a year. "CDMA makes more efficient use of the available frequency, and offers a better chance to meet the surging demand," an official of the Information Cooperation Office at the Ministry of Information and Communication. CDMA is cheaper to install and offers better call quality than GSM, and makes it easy for carriers to evolve into the next generation mobile service, he said. If China opens its wireless market to CDMA, Korean firms like Samsung Electronics, LG Electronics and SK Telecom, stand to make significant gains. "The possibility that China will choose CDMA is higher than ever. Such a decision will help clear the uncertainty weighing on the business prospect of Korean telecom-related firms," says Huh Young-min, an analyst at Samsung Securities. Should China adopt the standard, it will become the world's largest CDMA market estimated at $5 billion over the next five years, according to Lee Hyo-jong, an official of network business unit of Samsung Electronics. In this case, China Unicom, the nation's No. 2 telecom carrier, is expected to deploy an extensive CDMA network that supports some 70 million subscriber lines by 2004. The company has been ordered by the government to take over a CDMA network, known as the Great Wall, run by the army. To grab the initiative in the nascent market, Korean companies are enhancing their efforts to enter the market. Samsung has signed agreements with two Chinese firms including Shanghai Bell to jointly develop network systems and handsets. The company will officially launch a wireless research center Thursday in Beijing's Zhongguancun Technological Park, China's answer to 'Silicon Valley. LGE set up a joint venture Shenzhen ZTE-LG Mobile Communications in June with ZTE Corp., China's largest telecom equipment manufacturer. The two partners will open a joint research and development center Thursday. The $30 million joint venture located in Shenzhen is expected to start producing CDMA mobile telecom systems at the end of the year,Through the research centers, the Korean firms will develop equipment tailored to China's telecom environment as well as transfer technology, a condition that China demands for allowing foreign companies to enter the market. SK Telecom is also stepping up efforts to make inroads. The company has been working with ZTE Corp. to design a CDMA network system, while talks on technological cooperation with China Unicom has been underway since Unicom president visited Seoul last month. Telson Electronics and Beijing Telecom are working to manufacture wireless communication equipment in China as well. Kolon Data Communication is also working with ZTE Corp. to jointly develop repeaters, a main component used to make switching systems. Updated: 10/11/2000koreaherald.co.kr