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To: DaveMG who wrote (99)	5/26/1999 10:09:00 PM
From: DaveMG	Respond to of 426

Private Chinese carrier plans huge CDMA network By Sunray Liu EE Times (05/26/99, 5:14 p.m. EDT) BEIJING — China Unicom, one of the few rivals to state-run China Telecom, plans to establish a huge code-division multiple-access (CDMA) network with 50 million-line capacity and more than 35 million cellular-phone users by 2003. Unicom's planned acquisition of a pager business and four CDMA trial services from China Telecom in Beijing, Shanghai, the southern city of Guangzhou and Xian in central China underscores its plans for greater competition in the Chinese telecommunications market. A source here said one key to meaningful telecom reform in China was promoting rapid growth for Unicom. Currently, China Telecom's Global System for Mobile (GSM) wireless network is 10 times larger than Unicom's. Unicom said it will also invest more than $240 million in Internet Protocol telephony. Unicom will spend $870 million this year to build its CDMA network, which will initially serve 2 million customers. Network capacity will expand to 10 million users and cover 160 Chinese cities beginning next year. The company is aiming for a 30 percent share of the Chinese wireless-services market by 2003. CDMA's technical advantages and Unicom's heavy financial investment are expected to attract many Chinese users as the company attempts to knock down key technical barriers. For example, handsets initially available in the four major cities will have roaming capabilities all over China just as popular GSM services do, Unicom said. Moreover, Unicom will focus more heavily on third-generation wireless communications technology than other Chinese operators, said Li Zhengmao, Unicom's vice-chief engineer. China Unicom was formed by the former Chinese Ministry of Electronic Industry and other agencies to help break China Telecom's monopoly. Unicom initially challenged China Telecom by introducing its own GSM services. The company's CDMA announcement coincided with a telecommunications exposition hosted by Unicom at which several U.S. companies displayed CDMA-based systems. Lucent Technologies introduced a cdma2000 switching system while Motorola Inc. displayed cdmaOne and cdma2000 solutions along with its newest handsets. Local manufacturers have meanwhile announced advances in CDMA system design and production. Zhongxing Telecom (Shenzhen), China's first CDMA research unit, said it has designed a system based on its own intellectual property. Growing demand for handsets is also expected to created new opportunities for telecommunications manufacturers here and overseas. Major Chinese handset suppliers include Motorola, Qualcomm Inc. (San Diego) and South Korea's Samsung Electronics. Several local producers offer GSM handsets, and it is said they are interested in shifting to CDMA handset production. Industry experts here said some patents for CDMA handsets are held by Qualcomm. If patent issues are resolved quickly, they said, many Chinese manufacturers will jump into handset production. In that case, observers said it will create greater demand in China for new designs and CDMA chip sets. Unicom, Qualcomm and other technology companies are expected to play key roles during the fourth annual CDMA World Congress, to be held June 14-18 in Hong Kong. eet.com