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LG Electronics Arms CDMA Insurgents

LG Electronics Inc., a South Korean company focused on Code Division Multiple Access (CDMA) technology, is attempting to quietly gain a foothold in the extremely competitive U.S. wireless infrastructure market by helping second-tier carriers get a technological edge over their larger rivals.

As regular readers will remember, Unstrung reported in February how Monet Mobile Networks Inc. -- straight outta Sioux Falls, South Dakota -- was actually the first carrier to roll out a next-generation CDMA 1xRTT network in the U.S.

Well, Monet beat nationwide CDMA carriers like Sprint Corp.'s PCS division and Verizon Wireless to the punch with equipment from LG's U.S. arm, LG InfoComm U.S.A. Inc. Now LG says Monet will once again outstrip the pack by being the first U.S. carrier to launch a true third-generation (3G) CDMA2000 1xEV-DO (data only) network in September of this year, using LG's kit naturally.

LG's plan is to build on its experience of deploying CDMA in its home market, using smaller carriers as a proving ground for their base stations and other gear in the U.S. "Many of the existing tier one service providers have existing relations with the big equipment vendors," says Alex Ter-Vrugt, manager, infrastructure sales & marketing at InfoComm.

This could make it difficult it to sell into the larger accounts. "We know we have a lot of work ahead of us," admitted Melissa Elkins, PR manager at LG.

There's a logic to going after the smaller players like this: LG is hoping to get to the larger carriers -- which in the U.S. means Sprint and Verizon -- through the back door.

The folks at LG, like many others in the wireless industry, expect that after the Federal Communications Commission (FCC) repeals the limits on how much spectrum carriers can own on January 1, 2003, there will be an M&A feeding frenzy in the industry (see AT&T and Cingular: Hot for VoiceStream?). LG wants to provide the equipment that powers the networks that the large carriers buy.

"We're aiming to get a piece of the pie," says Ter-Vrugt. "But how much of the pie, it is too soon to say."

LG, a massive conglomerate in South Korea, is probably best known on the U.S. wireless scene for supplying CDMA handsets. London-based researcher Strategy Analytics Ltd. has just released a report on worldwide handset shipments, which notes, "LG… gained significant global share, improving its CDMA position and generating entry momentum with its GSM products." LG brought some of its new handsets into our offices, triggering a severe 'Inspector Gadget' attack for the Unstrung staff. Particularly cool was a new handset with a Gameboy-quality color screen and an LG smartphone gizmo, using a homegrown operating system. We're not supposed to say which U.S. carriers will launch these phones, but if you read this story closely you might have a few ideas of what's sprinting over the horizon.

— Dan Jones, Senior Editor, Unstrung
http://www.unstrung.com
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