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To: Ramsey Su who wrote (24519)	3/20/1999 1:59:00 PM
From: Jon Koplik	Read Replies (2) \| Respond to of 152472

Bro - I am going to post the text of the article. Friday, March 19, 1999 TELECOMS Mainland set for US standard YVONNE CHAN Mainland officials are believed to have approved the American-developed CDMA 2000 mobile phone standard, a move that would be a serious blow to European equipment suppliers. The government had been hesitant to approve CDMA (code division multiple access) wireless technology and instead has favoured the European GSM (global system for mobile) standard, which dominates mainland networks. Swedish mobile vendor Ericsson, with the co-operation of European partners, has developed wideband CDMA (W-CDMA), which is incompatible with CDMA 2000 - a third-generation wireless technology developed by US manufacturer Qualcomm. Adoption of CDMA 2000 would be a major gift to the United States, said a source. US companies would greatly benefit from sales of equipment and licensing manufacturing agreements for handsets. The People's Liberation Army - which generates profits by selling excess network capacity for civilian mobile networks - could also cash in because it has a nationwide spectrum for CDMA. An official announcement for CDMA adoption is expected next month during Chinese Premier Zhu Rongji's trip to Washington. He dangled a carrot to US companies earlier this week with the promise of foreign participation in the mainland's 180 billion yuan (about HK$167.58 billion) telecommunications industry. The Internet and mobile-phone markets might be the first to allow outside investment, said Big Brains analyst Peter Lovelock, although details of Mr Zhu's plan had so far been keep closely guarded. The basic residential telephone market would be one of the most attractive sectors to foreign companies, Mr Lovelock said, but it was questionable whether the state would liberalise it at this early stage. The impending breakup of state monopoly China Telecom - which is necessary for the mainland's entry into the World Trade Organisation - was believed to have been delayed under the protective guard of Information Industry Minister Wu Jichuan. Mr Zhu was apparently successful in getting State Council approval to sack the minister, said Mr Lovelock, who predicted that Mr Wu would depart by May, although his successor was not yet known. More than 40 foreign companies have already collectively invested about US$1.4 million in the only existing telecoms competitor, China Unicom, under a now-outlawed joint-venture scheme called China-China-foreign (CCF). Under CCF, foreign companies partner with mainland firms to fund a joint venture, which in turn forms another joint venture. The foreign firms receive "consulting fees" in return. The government so far has shown no signs of backing down from its stance on CCF ventures and there is speculation that Unicom's foreign partners could be compensated or bought out. Liu Cai, director of the information ministry's policy and regulation department, recently acknowledged that the national telecoms industry had been a target for criticism focused on problems "such as its monopoly and consequent high phone fees and poor service". His vision for liberalising the basic telecoms service calls for "reasonable competition", with the government "supporting competitors in a planned, step-by-step fashion". Satellite communications and the wireless mobile-telecoms market would have "limited competition", with the state "granting a reasonable number of operating licences and overseeing them", he said. Copyright (c)1999. South China Morning Post Publishers Ltd. All Rights Reserved.