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3G/HSPA

I'll Up You a Million

Now we are not suggesting in any way that the two are connected, but…

NEC Corp. (Nasdaq: NIPNY), which recently invested in two Hutchison Whampoa Ltd. (Hong Kong: 0013) telecom businesses (see NEC Invests in Operators), has just had its order for 3G handsets from Hutchison doubled to 2 million (see Hutch Orders NEC Handsets).

These handsets will be for use across all of Hutchison's 3G businesses as and when the operators need them.

And they're reasonably funky, too. The NEC 3G dualmode devices come in three designs, which you can see below:

Now, that's a very significant increase for NEC. So what does this ramp-up mean for Hutch's other dualmode device supplier Motorola Inc. (NYSE: MOT)? Does more from NEC mean less from Motorola, which has only just started rolling its devices off the production line (see Motorola Fires Up 3G Production)?

"This makes no change whatsoever to our orders with Motorola," says Ed Brewster, head of corporate communications at greenfield 3G operator Hutchison 3G UK Ltd., which has already taken delivery of 1,000 of NEC's devices (see Hutchison Inches Closer to 3G). "We will have volume delivery from Motorola by the end of November, and between the two companies they will deliver 100,000 handsets for use in the U.K. and Italy," where Hutchison has another 3G operator close to commercial launch.

With that number coming from the two vendors, one can only imagine that the majority might come from NEC, as its handsets are already being used by "friendly users" in the U.K. and will therefore be carrying fewer bugs. "It's about even," says Brewster unconvincingly. "It's not like NEC will be delivering 99,000 and Motorola only 20 or so." Indeed. That wouldn't be about even at all.

So while we're on the phone with Mr Ed, we ask how the friendly user phase is going? "The handsets are going out and coming back, and we're ironing things out," says Brewster, which is just what you'd expect. Hardly anyone would expect them to work straight out of the box. "It's all part of our step-by-step approach. Any issues that arise are dealt with before moving on to the next step."

So what about call handover from a WCDMA cell to the GSM network of O2 Ltd. (NYSE: OOM), with which the 3G new entrant has a roaming agreement? Is that possible yet? "This is an industry-wide issue," says Brewster. Absolutely. So is it possible for your friendly users to roam from 3G to 2G without the call dropping? "We are happy with the progress we have made." So is that a "Yes" or a "No"?

"We're pleased with the progress. Obviously it's an issue that we will have resolved before we go to a commercial launch stage."

Tricky, that handover.

— Ray Le Maistre, European Editor, Unstrung
www.unstrung.com
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