![](http://investorshub.advfn.com/images/default_ih_profile2_4848.jpg?cb=0)
Sunday, February 12, 2006 10:46:31 AM
By Kevin J. O'Brien International Herald Tribune
SUNDAY, FEBRUARY 12, 2006
http://www.iht.com/articles/2006/02/12/technology/btgsm.php
BERLIN Europe's GSM mobile standard, used today on 91 percent of all traditional digital phone networks, outsold a rival called CDMA, which the U.S. companies Qualcomm and Motorola developed to try to dominate the industry's pioneer era.
But as mobile network operators pay billions of euros to roll out faster so-called third-generation networks, a new standards battle is emerging, experts say, one that pits some of the same old opponents in a new constellation of interests.
This time, the competition is not as clear-cut as the Europe-vs.-U.S., GSM-vs.-CDMA conflict of the 1980s and early 1990s. While the rivalry is still between the third-generation successors to GSM and to CDMA, the commercial interests behind both have blurred and overlapped as manufacturers hedge their bets.
For example, Qualcomm, the San Diego-based company that makes chips for networks and handsets using CDMA 2000, the high-speed version of its old CDMA standard, is also a major developer and supplier to its competitor, the GSM third-generation standard called WCDMA, or Wideband CDMA. According to the European Technology Standards Institute, an industry standards group, Qualcomm holds 1,600 patents for WCDMA technology, many of them considered essential.
"The debate over standards is becoming increasingly moot over time," said Jeff Belk, Qualcomm's senior vice president for marketing, who said he was planning to attend the 3GSM World Congress in Barcelona that begins on Monday. "There are too many three-letter acronyms being thrown at the consumer," he said. "They don't really care."
Like Qualcomm, early GSM developers such as Nokia and Ericsson make handsets and networks for both WCDMA and CDMA 2000 standards, although Ericsson is ending its CDMA production and focusing on WCDMA, for which it holds 250 patents. Nokia, with about 1,460 GSM patents, belongs to CDMA's marketing association, the CDMA Development Group, based in Costa Mesa, California.
"Nowadays, the commercial interests behind the competing mobile phone standards are much more intermingled," said Martin Gutberlet, a director at Gartner, an industry research firm, in Düsseldorf. "GSM is the world standard in second-generation networks. But its success was a one-time event. I don't think any standard will ever achieve the same level of dominance."
Although GSM, named from the 1982 European initiative among national phone monopolies and suppliers called Groupe Speciale Mobile, won the first round in the digital standards war, CDMA, short for Code Division Multiple Access, has seized the lead in the third-generation race by taking advantage of technical problems that slowed the introduction of some WCDMA networks.
According to Wireless Intelligence, a London-based research group, CDMA-based high-speed networks currently have 249 million users, or an 80 percent share of the world's 3G market, compared with 61.8 million users and 20 percent for WCDMA, which is also referred to in Europe as UMTS, short for Universal Mobile Telecommunications System. Third-generation phone users now make up 13 percent of the world's more than two billion cellphone users, according to Wireless Intelligence.
"The world is very different when you are talking about third-generation networks," said Perry LaForge, executive director of the CDMA Development Group. "It's taken WCDMA way too long to get their products working on the market, and CDMA 2000 has emerged as a very significant standard."
For network operators, the consequences of betting on a standard can be costly.
The Japanese mobile operator KDDI switched on its CDMA 2000 high-speed network in April 2002. In three years, as of last July, KDDI had converted 94 percent of its 20.4 million customers to its newer, faster network.
By contrast, Vodafone, the world's largest mobile operator, installed a WCDMA network in Japan that was plagued by start-up problems and a shortage of compatible handsets. By last September, it had converted only 11 percent of its 14.6 million Japanese customers to its third-generation network, according to its latest financial report. Because Vodafone had so few people using the data services available on 3G, its average revenue per user in Japan fell 4.7 percent in the six months through September.
While phone users may not care whether their handsets or networks are WCDMA or CDMA 2000, manufacturers of the equipment certainly do. But because the patents for competing CDMA 2000 and WCDMA standards are shared by direct competitors, which lease them to each other at reasonable terms, most simply seek predictability, said Martin Garner, an analyst at the research firm Ovum. That lets them expand production and produce greater volumes more cheaply.
This is why Ericsson, the world's largest maker of mobile networks, decided last year to close its CDMA 2000 operations in San Diego, transferring its resources to its WCDMA production facilities in Sweden and Canada. The move allowed Ericsson to focus on WCDMA, and by November it seemed to have paid off when the Australian carrier Telstra decided to abandon its four-year-old CDMA 2000 network and spend more than $1 billion to refit it to the GSM successor WCDMA standard to cut costs and draw its equipment purchases from suppliers of a single standard.
"What happened in Australia shows how competitive the business is in 3G," said Peter Olson, vice president for strategy and product management mobile networks at Ericsson, which is supplying Australia's new WCDMA network.
"I think this could be the beginning of a trend where you will see WCDMA increasingly dominating new 3G orders."
That may be so in the short term, because most of the world's network operators run GSM networks, which can be upgraded to WCDMA for less than it costs to switch to CDMA 2000 technology.
But over time, LaForge of the CDMA Development Group said, many operators, especially those in rural areas, will opt for CDMA technology because its lower transmission frequency - typically 850 megahertz - provides better blanket coverage than WCDMA's high-frequency, 2.1-gigahertz broadcasting range.
And there is still a chance that Australia will not turn off its existing CDMA 2000 network, which cost the formerly state-owned Telstra more than $1 billion to build.
BERLIN Europe's GSM mobile standard, used today on 91 percent of all traditional digital phone networks, outsold a rival called CDMA, which the U.S. companies Qualcomm and Motorola developed to try to dominate the industry's pioneer era.
But as mobile network operators pay billions of euros to roll out faster so-called third-generation networks, a new standards battle is emerging, experts say, one that pits some of the same old opponents in a new constellation of interests.
This time, the competition is not as clear-cut as the Europe-vs.-U.S., GSM-vs.-CDMA conflict of the 1980s and early 1990s. While the rivalry is still between the third-generation successors to GSM and to CDMA, the commercial interests behind both have blurred and overlapped as manufacturers hedge their bets.
For example, Qualcomm, the San Diego-based company that makes chips for networks and handsets using CDMA 2000, the high-speed version of its old CDMA standard, is also a major developer and supplier to its competitor, the GSM third-generation standard called WCDMA, or Wideband CDMA. According to the European Technology Standards Institute, an industry standards group, Qualcomm holds 1,600 patents for WCDMA technology, many of them considered essential.
"The debate over standards is becoming increasingly moot over time," said Jeff Belk, Qualcomm's senior vice president for marketing, who said he was planning to attend the 3GSM World Congress in Barcelona that begins on Monday. "There are too many three-letter acronyms being thrown at the consumer," he said. "They don't really care."
Like Qualcomm, early GSM developers such as Nokia and Ericsson make handsets and networks for both WCDMA and CDMA 2000 standards, although Ericsson is ending its CDMA production and focusing on WCDMA, for which it holds 250 patents. Nokia, with about 1,460 GSM patents, belongs to CDMA's marketing association, the CDMA Development Group, based in Costa Mesa, California.
"Nowadays, the commercial interests behind the competing mobile phone standards are much more intermingled," said Martin Gutberlet, a director at Gartner, an industry research firm, in Düsseldorf. "GSM is the world standard in second-generation networks. But its success was a one-time event. I don't think any standard will ever achieve the same level of dominance."
Although GSM, named from the 1982 European initiative among national phone monopolies and suppliers called Groupe Speciale Mobile, won the first round in the digital standards war, CDMA, short for Code Division Multiple Access, has seized the lead in the third-generation race by taking advantage of technical problems that slowed the introduction of some WCDMA networks.
According to Wireless Intelligence, a London-based research group, CDMA-based high-speed networks currently have 249 million users, or an 80 percent share of the world's 3G market, compared with 61.8 million users and 20 percent for WCDMA, which is also referred to in Europe as UMTS, short for Universal Mobile Telecommunications System. Third-generation phone users now make up 13 percent of the world's more than two billion cellphone users, according to Wireless Intelligence.
"The world is very different when you are talking about third-generation networks," said Perry LaForge, executive director of the CDMA Development Group. "It's taken WCDMA way too long to get their products working on the market, and CDMA 2000 has emerged as a very significant standard."
For network operators, the consequences of betting on a standard can be costly.
The Japanese mobile operator KDDI switched on its CDMA 2000 high-speed network in April 2002. In three years, as of last July, KDDI had converted 94 percent of its 20.4 million customers to its newer, faster network.
By contrast, Vodafone, the world's largest mobile operator, installed a WCDMA network in Japan that was plagued by start-up problems and a shortage of compatible handsets. By last September, it had converted only 11 percent of its 14.6 million Japanese customers to its third-generation network, according to its latest financial report. Because Vodafone had so few people using the data services available on 3G, its average revenue per user in Japan fell 4.7 percent in the six months through September.
While phone users may not care whether their handsets or networks are WCDMA or CDMA 2000, manufacturers of the equipment certainly do. But because the patents for competing CDMA 2000 and WCDMA standards are shared by direct competitors, which lease them to each other at reasonable terms, most simply seek predictability, said Martin Garner, an analyst at the research firm Ovum. That lets them expand production and produce greater volumes more cheaply.
This is why Ericsson, the world's largest maker of mobile networks, decided last year to close its CDMA 2000 operations in San Diego, transferring its resources to its WCDMA production facilities in Sweden and Canada. The move allowed Ericsson to focus on WCDMA, and by November it seemed to have paid off when the Australian carrier Telstra decided to abandon its four-year-old CDMA 2000 network and spend more than $1 billion to refit it to the GSM successor WCDMA standard to cut costs and draw its equipment purchases from suppliers of a single standard.
"What happened in Australia shows how competitive the business is in 3G," said Peter Olson, vice president for strategy and product management mobile networks at Ericsson, which is supplying Australia's new WCDMA network.
"I think this could be the beginning of a trend where you will see WCDMA increasingly dominating new 3G orders."
That may be so in the short term, because most of the world's network operators run GSM networks, which can be upgraded to WCDMA for less than it costs to switch to CDMA 2000 technology.
But over time, LaForge of the CDMA Development Group said, many operators, especially those in rural areas, will opt for CDMA technology because its lower transmission frequency - typically 850 megahertz - provides better blanket coverage than WCDMA's high-frequency, 2.1-gigahertz broadcasting range.
And there is still a chance that Australia will not turn off its existing CDMA 2000 network, which cost the formerly state-owned Telstra more than $1 billion to build
Recent QCOM News
- Form 8-K - Current report • Edgar (US Regulatory) • 08/09/2024 08:05:49 PM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 08/09/2024 08:05:43 PM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 08/09/2024 08:05:27 PM
- Form 144 - Report of proposed sale of securities • Edgar (US Regulatory) • 08/08/2024 09:01:47 PM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 08/05/2024 09:03:28 PM
- Form 144 - Report of proposed sale of securities • Edgar (US Regulatory) • 08/02/2024 08:01:38 PM
- Qualcomm Gewinnmitteilung auf der Investor Relations Website des Unternehmens verfügbar • Business Wire • 07/31/2024 10:50:00 PM
- Publication des résultats de Qualcomm disponible sur le site web de la société consacré aux relations avec les investisseurs • Business Wire • 07/31/2024 10:50:00 PM
- Form 10-Q - Quarterly report [Sections 13 or 15(d)] • Edgar (US Regulatory) • 07/31/2024 08:02:08 PM
- Form 8-K - Current report • Edgar (US Regulatory) • 07/31/2024 08:01:12 PM
- Qualcomm Earnings Release Available on Company’s Investor Relations Website • Business Wire • 07/31/2024 08:00:00 PM
- US Index Futures Up Ahead of Fed Decision; Oil Prices Surge Amid Middle East Tensions • IH Market News • 07/31/2024 10:01:30 AM
- AMD Shares Surge 9% on Earnings Beat; Match Group Rises 10%, Pinterest & Lemonade Drop 13%, and More Earnings Updates • IH Market News • 07/31/2024 09:59:10 AM
- Qualcomm gibt Datum der Ergebnismeldung für das dritte Quartal 2024 und der Konferenzschaltung bekannt • Business Wire • 07/19/2024 08:32:00 PM
- Qualcomm annonce qu’elle va publier prochainement ses résultats pour le troisième trimestre de l’exercice 2024 et qu’elle tiendra une conférence téléphonique • Business Wire • 07/19/2024 04:22:00 PM
- Qualcomm Schedules Third Quarter Fiscal 2024 Earnings Release and Conference Call • Business Wire • 07/19/2024 01:00:00 PM
- Qualcomm gibt Quartalsbardividende bekannt • Business Wire • 07/17/2024 06:43:00 PM
- Qualcomm annonce le versement du dividende en espèces trimestriel • Business Wire • 07/17/2024 06:43:00 PM
- Qualcomm Announces Quarterly Cash Dividend • Business Wire • 07/17/2024 01:00:00 PM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 07/08/2024 09:39:01 PM
- U.S. Index Futures Mixed Following Tech Sell-Off, WTI and Brent Crude Dip Slightly • IH Market News • 06/25/2024 10:37:15 AM
- Trump Media Resells Stocks and Warrants; KB Home Exceeds Q2 Expectations, and More News • IH Market News • 06/20/2024 10:55:11 AM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 06/04/2024 08:07:43 PM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 06/04/2024 08:07:25 PM
- Form 144 - Report of proposed sale of securities • Edgar (US Regulatory) • 06/03/2024 09:27:46 PM
Maybacks Global Entertainment and ZEASN Technology Private Ltd. Sign Global Licensing Agreement • AHRO • Aug 8, 2024 7:00 AM
SANUWAVE Will Host a Conference Call on August 13, 2024 at 8:30 AM (ET) to Present Q2 Financial Results • SNWV • Aug 8, 2024 6:59 AM
Kona Gold Beverage Inc. Signs Letter of Intent with Bemax, Inc. to Sell Kona Gold, LLC • BMXC • Aug 7, 2024 10:00 AM
Btab Ecommerce Group, Inc. Launches Investor Connect AI Chatbot for Enhanced Investor Engagement and Lead Generation • BBTT • Aug 7, 2024 9:00 AM
Hydromer, Inc. Announces Preliminary Unaudited Second Quarter 2024 Financial Results and Provides Business Update • HYDI • Aug 7, 2024 8:52 AM
North Bay Resources Announces Mt. Vernon Gold Mine Startup, Sierra County, California • NBRI • Aug 5, 2024 9:00 AM