China Stands to Benefit from the 3G Market
China’s telecom industry will see a reshuffle in the near future as the government is expected to release the long-awaited license for the third generation (3G) technology and restructure the major wireless and fixed-line carriers later this year or next year.
As a result of the rise of Chinese telecom manufacturers like ZTE and Huawei, Qualcomm Inc, one of the world’s major providers of code division multiple access (CDMA) technology, anticipates significant growth in the coming years as China, its second largest market after South Korea, kicks off its 3G market.
Sanjay Jha, Qualcomm’s chief operating officer, believes that “China has a very good potential and will be good for the consumers, carriers, infrastructure and handset manufacturers. It will also be good for the software ecosystem here to develop new applications and services.”
And he predicts that China will see explosive 3G user growth when good network coverage, good applications are present and device prices come down. “One of the advantages of China being a little late on 3G is that these problems are being addressed quite well, so there are lots of applications already being developed and handset prices are already coming down. New services and applications are almost always the driver for new technologies.”
When asked whether the increasingly aggressive investment in R&D on the part of ZTE and Huawei will affect Qualcomm’s business and future cooperation with them, Sanjay Jha expressed his optimism. “ Not at all, I think it’ll help. As people generate their own IP, they’ll begin to understand how hard it is to generate innovative ideas and start recognizing the value of IP. I believe it will actually help in our interaction. As the expertise grows in these companies, our cooperation will enhance.”
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