Panasonic, UTStarcom Do 3G

BEIJING -- UTStarcom, Inc. (Nasdaq: UTSI), a global leader in IP access networking and services, and Panasonic Mobile Communications Co., Ltd. (PMC), a worldwide leader of mobile communications products, today announced the creation of a joint venture company to focus on design, development, and manufacturing of third-generation (3G) telecommunications system equipment. The joint company, Universal Communications Technology Hangzhou (UCTH), will first focus on providing comprehensive radio access solutions for a wide range of 3G mobile communications systems in China, the world's largest mobile market, and later expand into other international markets.

The product lines of the joint venture company will initially support the WCDMA standard, but will expand to support TD-SCDMA (Time Division - Synchronous CDMA).

"We are privileged to work closely with UTStarcom, as we have long admired their innovative corporate spirit," said Yasuo Katsura, president of Panasonic Mobile Communications Co., Ltd., "We believe this partnership will help us to provide more cost-effective 3G solutions to our customers. Partnering with UTStarcom will give us insight into their expertise as the leader in 3G core networking and softswitches, and enable us to gain entry into a customer base of the world's largest innovator and supplier of PAS wireless systems."

As a leading 3G vendor in the world, Panasonic brings field-tested, commercially deployed 3G radio products and technologies to the partnership. As a result of Panasonic's close collaboration with Japan's mobile operators in launching the world's first commercial 3G services, the company now has one of the largest market shares in Japan's 3G/WCDMA market.

As the largest telecom equipment provider to China Telecom and China Netcom, UTStarcom brings its strength in 3G IP core network technologies and its leadership in the broadband, PAS, and softswitch markets in China and internationally. UTStarcom gives Panasonic access to experienced service and support teams and close business relationships with major telecommunications operators throughout the world. UTStarcom also provides cost- efficient manufacturing and production practices located in China and savvy sales and marketing teams focused on customer-oriented solutions. UTStarcom is currently partnering with operators to prepare for full-scale 3G field trials, with the first trial planned for early 2004.

"Our joint venture with Panasonic will further enhance UTStarcom's end-to- end 3G solutions with heightened design and manufacturing capabilities on a larger economic scale with delivery efficiency," said Hong Lu, chief executive officer of UTStarcom, Inc. "This cooperation will benefit our customers as it will shorten the 3G deployment process and create more affordable, cutting- edge products and services."

Overview of the New Company:

Panasonic Mobile Communications Co. Ltd.

UTStarcom Inc.