Analysys International Says China Telecom's Trials of the TD-SCDMA Pilot Network Will Help China's 3G IP Negotiation with Overseas Holders

Dec 30, 2005, 00:00 ET from Analysys International

    BEIJING, Dec. 30 /Xinhua-PRNewswire/ -- Analysys International, a leading
 Internet-based business information service provider, says with China Telecom
 starting off the 3G pilot network of TD-SCDMA, China's negotiation progress on
 3G intellectual property rights with overseas owners will speed up.
     News Background
     ZTE is currently cooperating with China Telecom, the biggest fixed-line
 telephone operator in China, to build pilot 3G networks in Shanghai based on
 TD-SCDMA technology.  By now, Shanghai Telecom has built 30 3G base stations,
 covering the Caohejing Development Zone in Shanghai.  Recently, at an internal
 meeting about 3G in Beijing University of Posts and Telecommunications,
 experts recommended that China should issue a 3G license to China Telecom
 first and adopt TD-SCDMA as the 3G technology standard, so as to obtain a head
 start in the huge 3G market in the future.
     Quick Analysis
     Analysys International thinks that 2 conclusions can be drawn from this
     1. The authority shows its support to TD-SCDMA;
     2. It also shows the authority's intention to put pressure on overseas
        holders of 3G intellectual property rights.
     Regarding the maturity of standard, TD-SCDMA is far behind WCDMA and
 CDMA2000.  By now there have been more than 160 3G networks deployed worldwide,
 among which more than 80% of them are WCDMA networks, while as yet there is
 still not proven commercialized application of TD-SCDMA.  Considering the
 maturity of technology, TD-SCDMA hasn't got many proven projects like WCDMA,
 and the industry chain is not as developed as WCDMA.  Therefore, if China
 Telecom is issued the license first, it will have sufficient time to build up
 wireless communication infrastructures (mainly capital structures like machine
 rooms for base stations, lines, etc.) which will enable them to compete with
 China Mobile and China Unicom as well as get relatively more time of service
 tuning.  This will offset the weakness of an incomplete TD-SCDMA industry
 chain and lack of proven projects for technology maturity and help TD-SCDMA to
 make a better performance when competing with WCDMA and CDMA2000.
     Analysys International thinks that issuing a TD-SCDMA license to China
 Telecom also shows consideration to put pressure on overseas holders of 3G
 intellectual property rights.  Vendors who own most WCDMA and CDMA2000 patents
 such as Qualcomm have been negotiating with the China Academy of
 Telecommunications Research of MII on patent fees.  Analysys International
 thinks that if China Telecom starts to build TD-SCDMA, it will put pressure on
 those overseas owners who hold a strong position on the 3G (particularly
 CDMA2000) patent fees negotiation.  The longer the negotiations last, the more
 likely that WCDMA and CDMA2000 will be in an adverse position in the
 competition in China's future market.
     Analysys International's Position:
     Analysys International thinks that this news will speed up the progress of
 the negotiation between China and the overseas holders of 3G intellectual
 property rights.
     Additional information is available in Analysys International's latest
 research: Focus report on China's 3G Network Deployment 2005.
     About Analysys International
     Analysys International is the leading Internet based provider of business
 information about technology, media and the telecom industry in China with the
 mission to help their clients make better business decisions. They provide
 data, information and advice to 50,000 clients worldwide, representing 1,500
 distinct organizations, deliver over 150 consulting engagements a year, and
 hold more than 20 events that draw in over 8,000 attendees.  Their clients
 include executives from companies like technology vendors, vertical
 information technology users, as well as professionals from professional
 service companies, the investment community and government agencies.  For more
 information, please visit the web site at .
     For more information, please contact:
      Jessica Wang
      Overseas Media Manager
      Analysys International
      Tel:   +86-10-6466-6565 x394
      Fax:   +86-10-6466-7102/7103

SOURCE Analysys International