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Technology Stocks : Nokia (NOK) -- Ignore unavailable to you. Want to Upgrade?

To: tcd who wrote (521)	2/5/1998 3:23:00 AM
From: tero kuittinen	Read Replies (1) \| Respond to of 34857

There's a crucial development regarding the new 3G standard. Apparently South Korean mobile companies and Japan's DDI are considering backing the standard even though it isn't compatible with IS-95, the current narrow-band American CDMA standard. South Koreans and the Japanese rival for NTT-Docomo have been the linchpin of Qualcomm CDMA's global expansion strategy. If they really now start developing W-CDMA products based on the Nordic standard, it would be a major victory for GSM. GSM would then be the only second-generation standard with an easy upgrade option for third generation networks. American GSM operators just announced their backing of the Nokia/Ericsson W-CDMA as well. If the momentum grows big enough, the Koreans cannot afford to stand on the sidelines, even though they have bet heavily on Qualcomm CDMA. If Samsung really jumps on the W-CDMA bandwagon, they tacitly acknowledge that a 3G standard not compatible with their current CDMA standard will carry the day. I think the recent developments in India and China may be forcing the hand of the Korean and Japanese CDMA companies. These two countries have swung heavily to GSM in the past 8-10 months. It now appears that GSM will be the dominant standard in these two most populous & relatively fast-growing markets. A third generation solution not compatible with GSM would cost its manufacturers both the vast European upgrade market and the potentially even more lucrative Asian upgrade market. Thus the Nordic W-CDMA may be the only globally viable option. This leaves the American second generation CDMA with a thorny dilemma in its hands. How to convince new customers to buy the standard, if they know an upcoming global standard will not be compatible with it? If the Korean companies really join the W-CDMA fold as the rumours have it, a possible upgrade standard for current CDMA would have a tough future ahead of it. Tero