Nokia, China Putian Strike 3G Deal

UPDATED: Extending a decade-old relationship, Nokia and China Putian
will establish a $107 million joint venture for third-generation
network equipment, the companies announced today.

The operation will be based in Wuhan, China, and encompasses R&D,
manufacturing and sales of gear built on the 3G standards TD-SCDMA (Time
Division-Synchronous Code Division Multiple Access) and WCDMA (Wideband Code
Division Multiple Access).

Under today’s agreement, China Putian will control 51 percent of the company
and Nokia 49 percent.

The two companies have worked together on Global Standard for Mobile
communications technology since 1995.

Products from the joint venture will be sold under China Putian’s Potevio
brand and are expected to hit the market next year.
Nokia will continue to sell WCDMA systems under its own brand worldwide and
in China.

“The widened cooperation between China Putian and Nokia will contribute
greatly to the 3G industry development in China,” Simon Beresford-Wylie,
Nokia’s executive vice president and general manager of Networks, said in a
statement. “It shows Nokia’s concrete commitment to TD-SCDMA technology.”

In China Putian, Nokia has a partner with expertise in the TD-SCDMA
standard, which could be very useful in selling equipment to wireless
carriers in the populous country.

“China Putian has actively participated in the R&D and industrialization of
TD-SCDMA technology and was among the first companies to pass the TD-SCDMA
field trials, organized by the Chinese Ministry of Information Industry,”
Xing Wei, Chairman and CEO of China Putian, said in a statement.

Anna Linden, a spokeswoman for Finland-based Nokia, said the Chinese
government will decide on the timing of TD-SCDMA licenses.

“We agree with the industry estimation that the 3G licenses will be issued
in China in the first half of 2006,” she told internetnews.com.

Nokia and other telecom equipment makers have been partnering with their
Asian counterparts as a way to access emerging markets and drive down the
costs of production.

Earlier this year, Nortel signed a
similar joint venture agreement with China Putian and followed it
with a deal with South Korea’s LG Electronics.

Linden declined to comment on the similarities or differences between
Nokia’s China Putian JV and Nortel’s.

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