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Panning for gold in the telecom market
Last Updated(Beijing Time):2005-05-30 09:25

By Qin Haibo

Asia will become the biggest 3G-telecomm market in the world and the drive force of the 3G's future development will generate in Asia, especially in China, but not in North America or Europe. Such common agreement has been reached by the personages in the telecom field attending this Fortune global forum.

Currently, Japan and Korea are the most successful countries in the development of 3G system of the world. In the two countries, the wireless data service, which is the most applied part in 3G system, has rapidly developed and the network operators have obtained great profits. But in the European and American market where the wireless data service is not universal yet, to a large extent, the 3G system still provides the basic phone-call service, so the network operators can hardly take back the huge sum of investments in a short time.

Being the most potential telecommunication market in the world, China is in the concern of the global telecommunication tycoons. Since 2003, the CEOs of the multinational telecommunication equipments companies, such as Nokia, Motorola, Ericsson, Siemens, and Nortel, take turns to visit China with the purpose of lobbying the Chinese government to start the 3G-system network construction soon.

In the recent 10 years, the Chinese telecommunication industry has been keeping an extremely high growth speed; the average annual growth rate is above 20 percent. Now in China, both the numbers of fixed telephone customers and cellular phone customers have reached 350 million, which jump to the first in the world. Though the growing speed has slowed down a little bit in recent years, the 30 percent distribution rate is still highly attractive to the multinational telecommunication tycoons.

It's more exciting that wireless data service is gradually tried and accepted by the local Chinese cellular phone customers. The wireless data services of the China Mobile and China Unicom, have already reached 15 percent of the gross earnings or so, which has a narrow gap with the Japanese and Korean network operators. The annual growth rate of the short messages in China has been above 100 percent in recent years. The M-Zone service of the China Mobile had attracted more than 10 million young and vogue customers in just one year, and the diverse wireless services are becoming more and more popular among the youth.

Because the development of the Euro-American 3G market was not so successful in the past few years, China has been holding a careful attitude towards the 3G-network construction. But it is also said that China will launch in the experimental construction of the 3G networks in this year, as the maturity of the 3G technology, the development of its application and the improvement of the business model.

When the 3G is launched, will the case in the 2G age repeat that the great majority quotas were taken away by the foreign companies? In the 2G ages, because the domestic companies started late, more than 90 percent of the market quotas were occupied by foreign companies such as Motorola, Ericsson, Nokia and Siemens…etc. Almost all the domestic companies became the on-lookers for a more than 200 billion market. It's reported that the 3G network construction will arouse a market of nearly one trillion, and no one hopes that domestic companies are still out of play this time.

In the telecommunication equipments industry that tycoons stand up like a forest, domestic companies are just quietly rising. The TD-SCDMA standard with the independent intelligent property right, which is developed by Datang Telecom Technology Co., Ltd., is one of the three main world standards. The latest news shows that the TD-SCDMA has already had the independent ability of organizing the network and will be commercially applied in this June.

Currently, both the ZTE Corporation and the Quidway Technology Co., Ltd., which respectively has a short history of 20 years and 17 years, have displayed the considerable strength in the GSM, CDMA and 3G fields, and occupied certain market quotas.

By the end of 2004, Quidway has taken charge of five of the forty-eight 3G networks set up in the world. The wireless products of Quidway have already been exported to more than 40 countries, and its world sales breaks 100 million lines. Its WCDMA in Tunisia, and the CDMA2000 in Russia, Turkey, Algeria, and Vietnam have all already carried out the scale application.

Since the beginning of 2005, ZTE has built up the global strategically cooperative relations with many world famous telecommunication companies, which set up a good foundation for occupying the global high level market. Moreover, at the end of this April, Quidway was selected as the Britain preferential telecommunication supplier, and for the first time became the first-level supplier as Ericsson, Cisco and Siemens...etc.

"ZTE and Quidway have stood at the same scratch line with other leading companies in the industry, and have the ability to guard the domestic market and obtain a place in the global market", said an industry insider in the Fortune forum. 
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