Robb Makes Statement>
February 16, 1999
Robb ready to use trade authority for 3G
By Jeffrey Silva
WASHINGTON—In an embarrassing political blunder that lends insight
into the tricky third-generation wireless debate, Sen. Chuck Robb (D-Va.)
last week joined two fellow Finance Committee members in urging the
Clinton administration to use renewed Super 301 trade authority to make
Europe open its market to American-engineered digital wireless
technology.
The problem is, Robb's state of Virginia is home to L.M. Ericsson's
largest mobile phone and base station plant. The manufacturing facility in
Lynchburg, Va., employs 3,200 people.
It apparently did not occur to Robb that starting a trade war over
next-generation digital wireless technology would not be in the best
interests of a major constituent in his state, however.
The two-page letter, sent last Tuesday to U.S. Trade Representative
Charlene Barshefsky and signed by Robb, Sen. Kent Conrad (D-N.D.)
and Sen. Max Baucus (D-Mont.), was meant to further the interests of
U.S.-developed Code Division Multiple Access technology by
encouraging the United States to exert pressure on Europe to remove
trade barriers keeping U.S.-developed CDMA technology out of the
mobile phone market that Ericsson and Nokia dominate.
‘‘The EU's (European Union) use of technical barriers to trade is
profoundly unfair to American workers and consumers,'' the lawmakers
stated.
CDMA technology is locked out of the European Union, while European
wireless technologies are used in the United States.
A Senate Finance Committee hearing that was expected to address
wireless trade and other issues was postponed last week because of
impeachment proceedings.
Ericsson, Finland's Nokia Corp. and U.S mobile telephone operators that
use European-based Global System for Mobile communications
technology are locked in a fierce battle with Qualcomm Inc., Lucent
Technologies Inc. and U.S. CDMA carriers for rights to the multibillion
dollar 3G market.
Motorola Inc., a top mobile communications supplier in the United States
and around the world, is trying to remain neutral.
The Clinton administration, for its part, continues to push for multiple 3G
standards and harmonization of standards where possible. But while the
White House is scoring points with Qualcomm and its allies for pressing the
3G issue with the EU, it is ruffling the feathers of other American firms.
AT&T Corp., the top U.S. mobile phone carrier, BellSouth Corp. and
SBC Communications Inc. feel the administration's preoccupation with
CDMA could end up marginalizing 3G Time Division Multiple Access
technology, which they plan to deploy here and abroad.
‘‘Perhaps the full information was not available to Sen. Robb,'' said John
Giere, Ericsson's vice president of marketing and public affairs here.
Robb could not be reached for comment.
The International Telecommunication Union, which is overseeing 3G
standardization, said it intends to meet the March 31 deadline when it likely
will approve a family of 3G standards.
That is a tall order, given the nasty patent dispute between Qualcomm and
Ericsson.
The standardization process, subject of negotiations earlier this month in
Kuala Lumpur, will culminate in a critical ITU meeting, March 8-19, in
Fortaleza, Brazil. Also in March, U.S. and European Union officials will
meet for bilateral talks.
On Wednesday, 3G will be a hot topic at a TransAtlantic Business
Dialogue meeting in the nation's capital.
With super 301 trade authority alive again, USTR is expected to move
swiftly to provide Congress with a report on global trade barriers March
31—the same day ITU is to announce 3G standards. At the end of April,
the list will be narrowed down, and the United States will begin trade
negotiations to resolve disputes.
If talks are not successful, the United States most likely would launch
investigations—taking six to 18 months—which ultimately could lead to
trade sanctions.
‘‘It is not clear there is an unfair market barrier that deserves 301 action,''
said William Plummer, Nokia's vice president of government and industry
affairs here.
That Nokia, Ericsson, Lucent, Motorola and others are multinational
corporations complicates trade aspects of the 3G debate, as Robb
discovered.
Like Ericsson, Nokia has a respectable presence in the United States. The
firm has more than 5,000 employees on its payroll in the states.
One of Nokia's largest infrastructure and mobile phone plants is located in
the Dallas-Fort Worth area. In Boston, Dallas-Fort Worth and San Diego,
Nokia operates research and development facilities. It also has offices in
Silicon Valley, where it is developing Internet technology that wireless
carriers plan to capitalize on.
All told, according to Plummer, Nokia's U.S. subsidiaries export close to
$1 billion annually.
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