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TI Invests in 3G Handset Venture

Chipmaker Texas Instruments , along with Japanese handset makers Matsushita, NEC and Panasonic, said they have formed a joint firm to develop a new 3G platform by 2007.

Using a 12 billion yen joint investment, Adcore-Tech is slated to open next month in Japan as part of an effort to combine resources toward a platform for 3G handsets, according to a statement.

NEC and NEC Electronics, employing 180 workers, will hold 44 percent of the company; Matshusita and Panasonic Mobile will hold 44 percent; and TI will hold 12 percent.

As part of the agreement, NEC, Matsushita, Panasonic and TI will license technology to the new company for 2.5G, 3G and beyond technology.

In turn, the company will offer communications technology to NEC's semiconductor unit and Texas Instruments. Those chips then become part of phones made by NEC and Panasonic.

Texas Instruments refused to say whether the as-yet unnamed platform will be available to other handset makers. The phones will be available in Japan in fall 2007, according to TI spokesperson Renee Fancher.

"The more the merrier," said In-Stat's David Chamberlain upon learning of the agreement. Lack of handsets was a key stumbling block to 3G reaching its expected 2003 tipping point, according to Chamberlain.

Including TI will enable "those companies to expand off the island," Chamberlain said.

Although Japan makes some of the most advanced handsets in the world, NEC and Panasonic haven't made a dent in the lead by Nokia and Motorola .

Although the companies involved in the joint venture didn't say which communications protocol will be used, both NEC and Panasonic employ wideband CDMA (W-CDMA).

"Japanese W-CDMA isn't compatible with anything else," warned Chamberlain.

Will this venture spark growth in 3G?

Although the analyst refused to handicap chances for success, he did refer to the deal between consumer electronics giant Sony and cell phone maker Ericsson to produce a winning formula.