DoCoMo considers Cingular future

NTT DoCoMo has yet to decide on the shape of its future relationship with Cingular Wireless should the US carrier gain clearance...

NTT DoCoMo has yet to decide on the shape of its future relationship with Cingular Wireless should the US carrier gain clearance for its proposed takeover of AT&T Wireless Services, of which it owns a 16% stake.

"We believe we now have much more options than before," said Keiji Tachikawa, president and chief executive officer of NTT DoCoMo.

"We have to find out what Cingular has in its mind and based on that, we will decide on our future approach. Nothing is decided at this point. We've talked with the management of AT&T Wireless and, according to their explanation, Cingular seems to have an interest in DoCoMo as well so it's up to future discussion."

NTT DoCoMo picked up its AT&T Wireless stake in January 2001, during the height of the 3G wireless frenzy, paying around $8bn. Most of the value of the investment is now gone. NTT DoCoMo wrote off almost its entire investment in the carrier in 2002 following a sharp drop in AT&T Wireless' share price.

But an agreement still exists between the two carriers under which AT&T Wireless is obliged to roll out a WCDMA (Wideband Code Division Multiple Access) 3G service based on at least 1,000 cell sites in four cities by the end of this year, otherwise NTT DoCoMo can insist that AT&T Wireless buys back its stake.

That contract will remain in force should Cingular complete the deal and gain control of AT&T Wireless, said Tachikawa.

"Our position is that our rights will continue [should Cingular complete its deal]," he said. "I understand this is how contracts are interpreted in the US. In reality, I think they want to start roll out much earlier than December."

"The AT&T Wireless 3G network is already prepared, the infrastructure is being made and handsets have been ordered," he added.

Martyn Williams writes for IDG News Service

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