WCA July 2008

The government had said that it hoped to have a 3G network in place before the Beijing Olympics open in August. TD-SCDMA has failed to attract very many buyers abroad, but industry experts say regulators are pressing Chinese carriers to use it alongside the global standards. Suppliers such as Nokia Corp, of Finland, and Motorola Inc, of the US, say they are prepared to produce equipment based on the Chinese standards once the government picks carriers to receive 3G licenses. In other news of China Mobile Ltd, ✆ ✆ the company announced on 12 th April that it would seek to take small stakes in global telecom firms because controlling stakes had become too expensive. As reported by the Chinese news agency Xinhua, Wang Jianzhou, the chief executive, said that China Mobile expected to benefit from such deals despite the lesser influence that a minor holding entails. In China’s Hainan Province for the annual conference of the Boao Forum for Asia, Mr Wang reminded a seminar that his company last year bought an 89% stake in the loss-making Pakistani operator Paktel Ltd for $284 million. Suggesting that China Mobile had taken a lesson from its first telecom acquisition outside its home market, he said, “Entering into international telecom firms as small shareholders can help us learn from their experiences and gradually develop further.” Elsewhere in telecom . . . As reported in the ✆ ✆ Wall Street Journal for 11 th April, the publi- cation’s readers in Asia named South Korea’s SK Telecom top company in the region in terms of its innovativeness in responding to customer needs, even as they voted Samsung the most admired company for the eighth straight year. Samsung, also of South Korea, is world leader in consumer electronics. The results were derived from responses to the WSJ annual survey ‘Asia 200.’

Ericsson holds its lead in infrastructure services, while Alcatel-Lucent and Nokia Siemens gain ground

Global suppliers of services for telecom operators saw their revenue go up across the board in 2007 as the total market grew to $70 billion, for an 8% increase over 2006, according to the research and consulting firm Technology Business Research (Hampton, New Hampshire). The company’s Telecom Infrastructure Services (TIS) market model tracks market share of leading telecom equipment suppliers and provides forecasts for this rapidly evolving sector. In its latest TIS, published 1 st April, Technology Business Research reported that, last year, Ericsson Global Services , Alcatel-Lucent Services , Nokia Siemens Networks Services , Huawei, and other vendors stepped up their focus on service businesses to help insulate against slowing demand for telecom equipment. Meanwhile, according to the market model, the increasing congruency of the network and information technology worlds “is creating significant opportunities for IT vendors such as IBM, HP, Accenture, and EDS to seize growth opportunities” within telecom operator accounts; also for traditional infrastructure vendors to expand into more software-centric parts of the network, particularly OSS/BSS. Moreover, beyond the major players, a second tier of network and software vendors is stepping up systems integration and consulting initiatives. Among the key findings of the latest TIS: After announcing only a handful of managed services contracts in 2006, ✆ ✆ suppliers reported a surge in 2007, with more than 100 deals presented. While interest in outsourcing remains low in North America, other regions, especially Western Europe, are seeing more activity; Completion of mergers among suppliers has tightened the competition ✆ ✆ among the three largest telecom suppliers. TBR believes that Ericsson will face significant challenges to its market leadership as both Alcatel-Lucent and Nokia Siemens Networks become more aggressive in the network services space; While IBM continues to lead large IT systems integrators in revenue from ✆ ✆ service providers, HP markedly increased its position in 2007, bringing it into a virtual tie for the lead among these players; As network equipment spending slowed in 2007, service provider ✆ ✆ consolidation and migration to IP-based multimedia infrastructure drove opportunities for services.

With some 520 million subscribers, China has the world’s largest popu- lation of mobile phone users, and its decisions as to standards would significantly impact the telecom equip- ment market. Once the government awards licenses for third-generation, or 3G, services, companies expect a bonanza of spending on equipment, but Beijing has delayed its decision while trying to develop its own system to compete with global standards. Beijing’s effort, which commenced in 2001, would create opportunities for domestic telecom companies and reduce the necessity to pay license fees to developers of the global standards WCDMA and CDMA-2000, also approved for use in China.

Beijing may be nearing a decision on the award of 3G licenses China Mobile Ltd, the world’s largest mobile phone operator, said on 28 th March that it intended to launch a trial service of the homegrown Chinese next-generation standard within a week. China Mobile Communications Corp said in a statement that it would test the standard, known as TD-SCDMA, by distributing 20,000 phones and 5,000 data cards on 1 st April in Beijing and seven other cities. Third-generation mobile phone stan- dards will support video and Internet capability.

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Wire & Cable ASIA – July/August 2008