Samsung forms 3G venture with Chinese firm

Samsung and China's Eastcom are setting up a joint venture to develop 3G technology for the Chinese market.

Samsung and China's Eastcom are setting up a joint venture to develop 3G technology for the Chinese market.

The new company, Hangzhou Samsung Eastcom Network Technology, will be based in Hangzhou and will be capitalised at $6m. Samsung will own 70% and Eastcom will hold the remaining 30%.

China has yet to issue any licences for third-generation cellular services,although tests involving 3G technology are taking place this year.

The country's six telecommunication operators are testing three formats: WCDMA and CDMA2000, which are already in commercial use overseas, and TD-SCDMA (Time Division Code Division Multiple Access). The latter was largely developed in China but has yet to be used commercially.

Samsung Electronics is a major supplier of CDMA2000 infrastructure and terminals to operators in South Korea but is less experienced in WCDMA, which has been adopted by operators in several Asian nations and Europe.

The new venture in China, which will work on WCDMA, will not give the company a possible foot in the door to the Chinese market but could help it gain technological know-how useful in Europe.

The prospective launch of 3G services in China has spurred several other companies to make moves on the market.

In March, Germany's Siemens said it was teaming up with local company Huawei Technologies to form a research and development joint venture for third-generation TD-SCDMA (Time Division Code Division Multiple Access) technology and TD-SCDMA-based products. The planned company represents a $100m capital investment; Siemens will own 51% and Huawei 49%.

Last year, Japan's NEC said it would make China its development centre for international 3G handsets.

Martyn Williams writes for IDG News Service

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