Qualcomm Inc (QCOM)

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Dialing in to 3G
YU CHEN
2005-05-30 06:15

http://www.chinadaily.com.cn/english/doc/2005-05/30/content_446769.htm

There is no doubt a growing number of people will eventually choose to pay their telecoms and gas bills via handsets, rather than waiting in long queues at their banks.

Of course, payments made via handsets must be easy and, most importantly, secure.

That's just one example of the way value-added telecoms services can change our daily lives.

Value-added telecoms services including 3D gaming, location-based services, health-care consultations, e-government, rural and urban education, remote monitoring and various enterprise applications in the third-generation (3G) era of mobile communications will become an emerging, and increasingly important, industry.

Even more important, especially for telecoms operators, such value-added services will bring rich returns, such as improving revenues and enhancing average revenue per user (ARPU).

That's exactly what China's telecoms operators are trying to achieve at present, virtually on the eve of unveiling the 3G standards in China.

"What we are doing today is meeting customers needs and consolidating our brands," Lu Xiangdong, deputy general manager of China Mobile, said last week during ceremonies marking the launch of an "A+" solution for its "GoTone" subscribers.

Lu says the "A+" solution is a comprehensive integration of all the firm's services for "GoTone" users.

Those services include multimedia photos, ring-back tones, international roaming and online counters.

"By offering the whole package of services, we aim to provide optimized services to our customers to further consolidate our business," Lu says.

China Mobile, the world's largest mobile telecoms carrier, in terms of subscribers, is running a GSM (global system for mobile communications) network. It plans to adopt WCDMA (wideband code division multiple access) when it migrates from 2G (second-generation) to 3G.

Analysts believe China Mobile's launch of the "A+" solution indicates it is enhancing services in preparation for 3G.

China Mobile has long attached great importance to value-added telecoms services, especially in the competition with its major rival, China Unicom.

"We believe the value-added business will gain increasing importance, as it will play an increasingly important role in differentiating our services from those of our competitors," says Ye Bing, director-general of China Mobile Communications Corporation's Data Service Department.

He expects explosive development in value-added telecoms services this year.

China Unicom, meanwhile, plans to take greater advantage of its CDMA networks and develop more value-added telecoms services this year, says Wang Yingpei, general manager of China Unicom's Value-added Business Department.

Wang says China Unicom has classified its value-added services into three main categories entertainment, daily life and industrial applications.

Currently, China Unicom's value-added services are mainly based on WAP (wireless application protocol), BREW (binary runtime environment for wireless) and JAVA technologies.

Wang says 70-80 per cent of the value-added telecoms services such as streaming media , video on demand, mobile payment and location-based services can be upgraded to 3G.

"Although we do not have a timetable for the launch of 3G-related telecoms services, as we are trying to land a 3G licence, we believe value-added services will be a key revenue generator for us in the future," Edward Tian, vice-chairman of China Netcom, tells China Business Weekly.

He says he is confident China Netcom will secure a mobile licence when the Chinese Government unveils its 3G strategies.

He says the company is working on broadband services to pave the solid foundation for 3G-based, value-added telecoms services.

To accelerate its broadband business, China Netcom in January clinched a strategic partnership with PCCW, when it acquired a 20-per-cent stake in the firm.

Tian says China Netcom is teaming with PCCW mainly in the areas of broadband-video conferencing, international business, mobile business, Yellow book services and real estate.

In March, China Netcom readjusted its broadband strategy when it unveiled a new brand name - CNC MAX.

All of China Netcom's former broadband businesses aimed at families and individuals were placed under the new brand.

Analysts say domestic telecoms operators are right to roll out more value-added telecoms services before China adopts 3G.

"The applications and content could be well tested by the market, as there are no killer applications so far," says Samuel Chua, an analyst with KGI Asia Ltd.

Chua believes 3G is a tremendous opportunity for domestic telecoms operators to enhance their competitiveness, by rolling out new services and applications.

It is widely believed the Chinese Government will roll out 3G licences later this year, given the fast development of 3G technologies worldwide.

"I believe 3G will drive a major, positive change for consumers and businesses around the world in entertainment, education, medical care, economic growth and security, and it will do so at lower costs and universal availability," says Irwin Jacobs, chairman and chief executive officer of Qualcomm Inc.

"With 3G, wireless consumers are able to use their handsets to capture video, monitor kids from a remote place, download movie trailers, find a place to dine, watch football games, access e-mail, get traffic updates and even check their blood pressure."

In addition, 3G enables mobile carriers to provide cost effective, innovative data applications and rich multimedia to large numbers of consumers.

"The mobile handset is increasingly becoming a highly integrated, indispensable device that represents the convergence of many consumer, communications and computing technologies," he says.


(China Daily 05/30/2005 page8)