Taiwan Tastes China's 3G Flavor

Datang Telecom Technology Co. Ltd. and Taiwan's Industrial Technology Research Institute have signed a cooperation agreement to develop a trial TD-SCDMA network in Taiwan, according to China's official news agency, Xinhua.

The network is being set up as a test bed for Taiwan's extensive chipset and device communities and not as a competitor to Taiwan's existing 3G networks. It is being established to encourage vendors to develop products for China's homegrown 3G technology by removing the requirement for vendors to take products to the mainland for testing.

Commercial TD-SCDMA (Time Division-Synchronous Code Division Multiple Access) services were launched in China by China Mobile Ltd. (NYSE: CHL) earlier this month and both it and the Chinese government are very aware that matching the range of handsets offered by CDMA and Wideband-CDMA is vital for the take-up of TD-SCDMA.

China Mobile has already poured half of a total RMB1.2 billion ($175.6 million) budget into the R&D project that it set up through cooperation agreements with nine mobile phone manufacturers and three chipset producers.

The Chinese government is also looking to promote TD-SCDMA at every turn and has expressed its desire for TD-SCDMA to account for 20 percent of the world 3G market outside of China by 2020, according to China Interfax. The Taiwanese testbed is one of the first TD-SCDMA networks outside of mainland China.

This is considerably higher than most industry observers expect, with Pyramid Research putting TD-SCDMA's global market share at around 13 percent by 2014. This figure includes China, which is expected to account for the majority of TD-SCDMA customers at that time.

— Catherine Haslam, Asia Editor, Light Reading

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