Nokia and China CDMA Handset Licensing
"Nokia said it expects to get formal approval from the Ministry of Information and Communication to make the handsets from next month, launching its first phones by July." - 10/04/03 CommsDay Asia -
The 19 Original CDMA Handset Manufacturing Licensees
1. Ningbo Bird Co Ltd
2. China Kejian Co Ltd
3. Shenzhen ZTE Telecom Co Ltd
4. Beijing Post & Telecom Equipment Co (Capital)
5. TCL Group
6. Qingdao Haier Group
7. Hangzhou Eastcom Mobile Phone Co Ltd
8. Motorola (China) Electronics Co
9. Shenzhen Konka Group Ltd
10. Guangzhou Soutec Co Ltd
11. China Electronics Corp Communications Technology Co, Ltd
12. Datang Telecom Technology Co Ltd
13. China Zhenhua Science Technology Co Ltd
14. Shandong Langchao Group
15. Qingdao Hisense Group
16. Dalian Daxian Group
17. Nanjing PTIC Telecom Co Ltd
18. China PTIC Tianjin Telephone Equipment Co, Ltd
19. Xiamen Overseas Chinese Electronics Co Ltd (Xoceco)
When the licenses were granted by the China State Development Planing Commission, China's Economic Information Service (CEIS) quoted an MII official as saying on August 31, 2001:
"China's Ministry of Information Industry (MII) issued licenses to 19 companies for producing CDMA mobile phones and is not likely to issue more licenses, as these companies are already too many for the market."
Among the licensed companies, Motorola (China) is the only foreign firm and the rest are domestic firms, which include many original home appliance makers. If foreign manufacturers want to enter the Chinese market, they may have to set up equity or non-equity joint ventures with licensed Chinese partners, added the official. Furthermore, not all licensed Chinese companies have the confidence to be successful in the market. In order to remain competitive in this growing market, the domestic companies need to team up with mature foreign companies to manufacture CDMA cell phones. Industry experts believe that other licensed manufacturers plan to partner with foreign companies that have the technologies and strong R&D capabilities. Besides for competing for the growing China market, these companies will also export to other CDMA markets - including the United States.
216.239.57.100
Since the licenses were granted:
* Hitachi, Japan's major CDMA phone producer, and Qingdao based Hisense, a well-known home appliance producer in China, announced their intention to set up a joint venture to manufacture CDMA phones. (8 - 28 - 2001).
* Samsung Electronics set up a joint venture with China Kejian, Shenzhen Zhixiong Electronics and Shanghai Lianhe Investment to produce CDMA handsets for the Chinese market. Kejian holds 21% of the joint venture with Samsung as the dominant shareholder, holding 49%. Shenzhen Zhixiong Electronics took 20% and Shanghai Lianhe Investment the remaining 10%. The company is headquartered at Shenzhen, Guangdong province, in Southern China. Samsung Kejian produces CDMA cellular phones for both Samsung and Kejian brands. The venturewas set up with a combined investment of US$60m and a registered capital of US$20m. Samsung also opened a CDMA mobile communications research center in China. Beijing Samsung Telecommunications Technology Research Co., Ltd. is located in the Joongkwanchon district of Beijing The center is a wholly-owned subsidiary of Samsung China Investment Co., Ltd. (16-Oct-01)
* Samsung Electronics Co. Ltd. and Shanghai Bell Co. Ltd. announced plans to establish a joint venture company called Shanghai Bell Samsung Mobile Communications Co. Ltd., to develop, manufacture and sell CDMA network equipment. Shanghai Bell, which is majority owned by Alcatel SA, owns 51 percent of the new company with Samsung Electronics holding the remaining 49 percent. Initial paid-in capital was US$12 million and the two companies planned to contribute a total of $29 million for operations. (26-Nov -01)
* LGE formed a Chinese joint venture with Langchao named Langchao LG Digital Mobile Communication Technology. LGE planned to invest US$15 million in the CDMA manufacturing joint venture, later to be expanded by an investment of US$45 million. Total monthly production capacity was slated to reach 100,000 units. (Feb -02)
China CDMA Licensing
The following abstract discusses China Licensing and conjectures as others have that MII is likely to loosen the restrictions on mobile phone productions, and will issue more new licenses next year:
>> China's Booming Mobile Phone Market
Lehman, Lee & Xu
China Lawyers, Patent & Trademark Agents
China Information Technology Law Newsletter
Vol. 4, No. 1 - January 2, 2003
china.lehmanlaw.com
[Source: Interfax Information Services B.V.]
China's booming mobile phone market is encouraging more companies to enter the lucrative business.
A seminar on mobile equipment and terminal development was held recently in Ningbo. Officials from the State Development Planning Commission (SDPC), the Ministry of Information Industry (MII) and China Mobile Communications Association (CMCA) attended the seminar.
At the meeting, more than 10 companies including Ningbo Sanxing Aux, Skyworth, Digital China and Hi-Tech Wealth urged the Chinese government to remove the current existing mobile phone production permit system since such a system blocked more qualified firms from entering the market. Companies seeking to obtain mobile phone production licenses include Ningbo Sanxing Aux, Skyworth Digital, Digital China, Shenzhen Jinli Communications Equipment Co., BOE Technology Group, Beijing Hi-Tech Wealth, Ingram Micro (China) Ltd., Beijing Galaxy Information Technology Inc., Communications Branch of China Electronic Appliance Corp., Beijing Zhongdian Future Communications, Shenzhen Suifeng, Shanghai Emol Communications, and Beijing Putian Taili Communications.
At present, there are two ways for these unlicensed firms to market their handsets on domestic markets: either buy licenses from those licensed manufacturers, or cooperate with licensed manufacturers. Both ways will greatly raise production costs for the unlicensed companies. For example, the NASDAQ-listed company, Qiaoxing had to acquire a 65% stake in CEC Telecom at a price 70% higher than the net asset value of the company just because CEC Telecom owns both CDMA and GSM mobile phone production licenses.
To go across the policy barrier, some companies launched or are planning to launch their mobile phone PDAs (personal digital assistants), like smart phones by Dopod and a PDA handset by Siemens and Hi-Tech Wealth since no license is required for the mobile phone PDAs. They are sold as PDAs although they also have mobile phone functions.
So far, the MII has issued 49 mobile phone production licenses in total, including 30 GSM licenses to 13 Sino-foreign joint ventures and 17 domestic firms, and 19 CDMA licenses to 18 domestic firms and only one foreign firm - Motorola. At present, 11 companies in China own both CDMA and GSM handset production licenses and 7 licensed manufacturers produce only CDMA mobile phones. In addition, licensed Sino-foreign joint ventures are required to export at least 60% of their output.
It is predicted that the MII is likely to loosen the restrictions on mobile phone productions, and will issue more new licenses next year. <<
- Eric - |
