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Technology Stocks : Qualcomm Incorporated (QCOM) -- Ignore unavailable to you. Want to Upgrade?

To: bananawind who wrote (14415)	9/1/1998 3:03:00 PM
From: bananawind	Read Replies (2) \| Respond to of 152472

Motorola severs ties on U.S. 3G stance rcrnews.com By Jeffrey Silva WASHINGTON-The third-generation wireless debate took a dramatic turn last week as a key Clinton administration official questioned whether the United States should follow Europe's lead in allocating massive 3G spectrum, and an industry schism erupted that could have Motorola Inc. going its own way. Motorola, the top U.S. wireless manufacturer, abruptly pulled out of a White House meeting it was to attend with Qualcomm Inc., Lucent Technologies Inc. and Sprint PCS last Tuesday. The meeting took place without Motorola. Attending from the administration were David Beier, domestic policy adviser to Vice President Gore, and the National Economic Council's Thomas Kalil and Dorothy Robyn. Bill Corbett, of the U.S. trade representative's office, is another key player on 3G policy. According to sources, Motorola lobbyists became alarmed after learning Qualcomm and others planned to urge White House officials to take an official U.S. position favoring a converged 3G standard for Code Division Multiple Access-based systems. Motorola had no official comment. Motorola, sources said, did not want to be associated with a 3G convergence position it does not share. Sources said Motorola had been under the impression Qualcomm desired only that the U.S. government ensure that Europe be open to multiple 3G standards and the European Union generally not erect barriers to wireless trade. That Qualcomm and its allies now want the Clinton administration to take a firm position with Europe on a converged CDMA 3G standard is not insignificant for Motorola. Motorola, invested in both CDMA and European-based Global System for Mobile communications technologies here and overseas, has had to straddle the 3G issue as it struggles internally to settle on a corporate position going forward. Motorola lobbyists plan to meet White House advisers Tuesday to explain its position on 3G. U.S. wireless firms have taken a beating in the foreign press on the 3G controversy and sources said Motorola, a multinational wireless giant, had to make a break with Qualcomm to avoid burning bridges with foreign customers. The fact that top U.S. wireless firms are not unified on 3G policy could make it more difficult for Qualcomm to convince policy makers to invest political capital in 3G. Indeed, U.S. mobile phone carriers that use GSM technology do not favor convergence. ``Convergence is not about advancing an American technology. It's about advancing Qualcomm's commercial interests,'' said Mike Houghton, a spokesman for GSM in North America. ``What they're trying to do is impose a toll booth on the information highway.'' Houghton said U.S. GSM carriers support multiple 3G standards, however. At the same time, the possibility the United States may not support a major spectrum allocation for 3G could help Qualcomm's convergence cause. ``Before we jump to the question of spectrum allocation, we need a national policy debate on how we want to use the spectrum,'' said Vonya McCann, head of international telecom policy at the State Department, at a conference last Wednesday sponsored by the Personal Communications Industry Association. ``We first must ask what are our national needs for the spectrum; what are our foreign policy and national defense needs and goals; is there is a consensus on these estimates; and how does this consensus affect existing radio services,'' McCann said. The spectrum issue, which the Federal Communications Commission requested comment on last week, has significant implications for the 3G standards-setting, U.S. strategy for the World Radiocommunication Conference in 2000 and future U.S.-European Union trade relations. Comments are due to the FCC by Sept. 30. Qualcomm, a CDMA technology developer and manufacturer, embraces an American-based 3G standard called cdma2000 but are willing to settle for a converged CDMA standard that is backward compatible with existing CDMA networks here and abroad. With backward compatibility, the argument for huge new chunks of spectrum for 3G in the U.S. could be weakened and the case for convergence strengthened. Estimates are as much as 500 megahertz will be needed to fuel 3G wireless in the United States. On the other hand, it is clear U.S. wireless carriers will need some additional spectrum to transition to 3G networks. Where will it come from? Congress has forced the federal government to surrender spectrum to the private sector in recent years. Extracting more spectrum from the Pentagon, NASA and other federal agencies will be a herculean task, perhaps impossible. It is unclear how much spectrum the federal government controls, which agencies occupy what frequencies and how efficient channels are used because such information has never been fully disclosed to the public. That information is held tight to the vest for reasons of national security. Qualcomm claims the 15-member European Union intends to lock out U.S.-engineered third-generation CDMA in favor of wideband CDMA based on a GSM technology dominated in Europe and much of the world by Sweden's L.M. Ericsson and Finland's Nokia Corp. Qualcomm also argues the E.U. and European Telecommunications Standards Institute have conspired to ensure W-CDMA is incompatible with existing CDMA technology. European and U.S. proponents of GSM allege Qualcomm is simply trying to extort exorbitant licensing fees from wireless equipment manufacturers. Qualcomm, claiming to hold essential intellectual property rights to CDMA, has warned the EU against going forward with W-CDMA. Qualcomm's aggressive lobbying of Congress and the Clinton administration is centered around a strategy that frames 3G as a U.S.-E.U. trade issue. So far, that strategy has paid off as the 3G trade issue gets raised increasingly in congressional hearings and correspondences between lawmakers, like Sen. Ernest Hollings (D-S.C.) and Reps. Connie Morella (R-Md.) and Robert Matsui (D-Calif.), and the Clinton administration. It is uncertain what the administration will do. McCann, FCC Chairman Bill Kennard and Commerce Department trade undersecretary David Aaron discussed 3G with their E.U. counterparts in Brussels last month. E.U. officials assured the U.S. delegation it would be open to multiple 3G standards even though a bill in the European Parliament mandates a single, ETSI-approved standard throughout the region. CDMA is shut out of Europe today. McCann said more talks will be held with E.U. officials in early September. But 3G is far more complicated and has many more dimensions as either side lets on in their verbal warfare. McCann concedes as much. ``During this formative stage of 3G, we see the awkwardness and difficulties of determining which standards and which bands of spectrum will carry us into the next millennium,'' she said.