SK Telecom to Help China Develop 3G Mobile Service
Aug. 29 (Bloomberg) — SK Telecom Co., South Korea’s largest mobile-phone operator, will help China develop its own standard for wireless networks, seeking access to the world’s biggest cell-phone market by subscribers.
The alliance is the first China’s government has signed with an overseas operator for the third-generation technology known as TD-SCDMA, which allows faster downloads of movies and music, the Seoul-based company said in a statement. SK Telecom bought $1 billion of bonds convertible into shares of China’s second- largest mobile-phone company in July.
China’s homegrown standard needs to win customers to compete with rival technologies developed by Nokia Oyj and Qualcomm Inc. SK Telecom, the world’s first provider of 3G services, joins Spain’s Telefonica SA and Hong Kong’s PCCW Ltd. in trying to access a market with more cell-phone users than the combined populations of the U.S. and Japan.
China “can benefit from the experience of a foreign operator,” said Kelvin Ho, a telecom analyst at Nomura International (Hong Kong) Ltd. The agreement may “help faster development of the TD-SCDMA standard in China.”
SK Telecom said last month when it bought bonds convertible into a 6.7 percent stake in China Unicom Ltd. that the two companies would cooperate in the development of handset and network technology and new services.
Shares of SK Telecom rose 1.1 percent to close at 189,500 won in Seoul. The stock has fallen 6.9 percent since the company announced the convertible bond purchase, compared with a 9.7 percent rise by the Kospi stock index in that period.
`Government Support’
As part of the agreement announced today, SK Telecom will test TD-SCDMA in South Korea by the second half of next year, the statement said. China plans to start the 3G service before the start of the 2008 Beijing Summer Olympics, according to the statement.
SK Telecom expects its China business, into which SK Telecom has committed a great deal, to gain much momentum with the support of the Chinese government,” the company said.
China’s TD-SCDMA, or time division-synchronous code division multiple access, technology competes with wideband-CDMA, developed by companies including Nokia and Ericsson AB, and Qualcomm’s CDMA2000 as 3G standards.
In October 2000, SK Telecom became the world’s first company to start 3G mobile-phone services. A year later, NTT DoCoMo Inc. was the first operator to offer W-CDMA, the most common standard for the high-speed service.
Issue License
China’s government may issue its first 3G license within six months, China Netcom Group Corp. (Hong Kong) Ltd. Chief Executive Officer Zuo Xunsheng said in an interview in Hong Kong last week.
The Chinese regulator in February asked the parent companies of fixed-line operators China Netcom and China Telecom Corp. and China Mobile Ltd., the world’s largest cell-phone operator by users, to conduct trials of the TD-SCDMA standard.
Companies may spend 80 billion yuan ($10 billion) on 3G networks in China in the first year licenses are issued, according to estimates by Beijing-based researcher BDA China Ltd.
China added 38.4 million mobile-phone users in the first seven months of this year for a total of 431.8 million, according to government data.
Source-http://www.bloomberg.com
Technorati : China, Mobile, SK Telecom
Ice Rocket : China, Mobile, SK Telecom
