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China's 3G Wireless Ambitions Delayed

China is developing a competitive 3G standard, known as TD-SCDMA, as a rival to Europe's WCDMA standard and Qualcomm's CDMA2000. But a report says the new Chinese wireless standard won't be ready until 2004, at the earliest.

Reuters on Thursday quoted Li Shihe, chief technology officer at Datang Mobile Communications Equipment, saying China's 3G standard will not be deployed for at least another year.

China Telecom and China Netcom have yet to receive licenses, which would sanction the construction of 3G wireless networks throughout China. For international telecommunications firms vying for contracts, it is essential that the new Chinese wireless standard has been fully tested, and ready for widescale commercial deployment.

Datang's parent company has not said whether TD-SCDMA will be compatible with Europe's WCDMA on Qualcomm's CDMA2000, but the report said Datang will spend $120 million to develop the technology this year, and its German partner Siemens AG will invest $50 million on the standard this year.

TD-SCDMA, stands for Time Division Synchronous Code Division Multiple Access, and could generate billions in licensing, construction and other wireless service contracts.

China Unicom, China Mobile and other Chinese telecommunications firms are expected to be granted 3G licenses based on the standard later this year, or perhaps in early 2004.

One U.S.-based firm involved with wireless testing and potential deployment in China's 3G market is Agilent Technologies. Agilent already has an established presence in China and is building a new research and development center in Beijing. A December 24th report on Chinadaily.com says: "the Beijing centre will develop modeling and simulation software tools to enhance the design of 3G (third-generation) wireless devices and components, including TD-SCDMA (time division synchronous code division multiple access)." The report quotes Guy Sene, vice president of Agilent Technologies.

A December 2002 research report on the "China Telecom's market from CLSA Emerging Markets says: "implementing TD-SCDMA could mean savings of hundreds of millions of dollars in royalty fees." The report says by eliminating European or American wireless company royalty fees, domestic Chinese wireless vendors will be positioned to be more competitive, if the technology becomes proven.

CLSA Emerging Markets goes onto say there will be "300 million mobile subscribers China in 2005." And technological development isn't stopping with China's bid to develop its own 3G standard.

CLSA Emerging Markets goes onto say that China has already met with South Korea and Japan about the 4G standard. Government and company officials of China, South Korea and Japan will meet in Seoul in April to discuss details for the 4G standard.

According to the CLSA report, NTT DoCoMo has conducted prototype tests with download speeds of 100 Mbps, and upload speeds of 20 Mbps. Preliminary research is being done of 5G wireless technology, which would enable voice, data, audio and video traffic to travel even faster over mobile networks.