Nortel Suffers China 3G Setback

Nortel Networks Ltd.'s (NYSE/Toronto: NT) plans to set up a 3G equipment joint venture with China Putian have fallen though, Unstrung has learned.

The news comes as Nokia Corp. (NYSE: NOK) today announced its own joint venture with China Putian. (See Nokia Invests in China 3G.)

In January this year Nortel announced it was hooking up with the Chinese vendor to create a new firm called Putian-Nortel Networks Telecommunications Equipment Co. Ltd. to develop 3G equipment based on the TD-SCDMA and W-CDMA standards. (See Nortel Teams on Chinese 3G.)

Now, it seems, that potentially very long corporate nameplate is never to see the light of day.

According to a Nortel spokesman, the joint venture deal was never actually signed, and January's announcement was only one of intent to form the company. He says those particular discussions have now ended, but that Nortel and Putian "are still cooperating, but in forms other than a joint venture."

The spokesman adds that Nortel, in addition to its scaled down dealings with Putian, is also trialing 3G kit with Datang Telecom Technology Co. Ltd., which is Alcatel's (NYSE: ALA; Paris: CGEP:PA) 3G partner in China. (See Alcatel, Datang Prep TD-SCDMA.)

The spokesman says Nortel is also engaged in 3G development in China through its Guangdong Nortel Telecommunications Equipment Co. Ltd. subsidiary, but that this is focused on WCDMA technology, and not on China's home-grown 3G standard TD-SCDMA.

— Ray Le Maistre, International News Editor, Light Reading

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