US firms secure China CDMA deal

US firms secure China CDMA deal
Tom Foremski Motorola and Lucent Technologies have secured a $500m contract to provide a Chinese telecommunications company with CDMA equipment. The contract raises the prospect that China will embrace CDMA2000, the US based third generation proposal for the International Telecommunications Union’s IMT-2000 standard, rather than the rival European UMTS. However, the deal is complicated by the telecoms company, Great Wall, being half owned by the Chinese military. US Commerce Secretary William Daley was in China last week and was scheduled to be present at the signing of the contract but hastily withdrew after learning of Great Wall’s ties to the Chinese military. Daley bowed out of the ceremony because of widespread criticism in the US about Chinese access to US military technology through alleged spies and through joint US ventures on satellite launch projects. China’s sanctioning of CDMA technology opens up a huge potential market for US and European wireless communications companies. The Chinese government expects to introduce CDMA services to as many as 40 million users by the end of 2000. US telecommunications firms, however, want China to change the rules on foreign investment in local telecommunications companies. Daley has been negotiating with Chinese authorities to allow foreign companies to take a greater stake in their Chinese counterparts.


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