German electronics kingpin Siemens on Friday said it has joined with China telecom equipment firm Huawei to develop, manufacture and market phones based on China's own third-generation (3G) technology.
The new company, with an investment exceeding $100m (£63m), will be based in Beijing. Siemens mobile will hold 51 percent of the joint venture, and leading Chinese telecommunication player Huawei Technologies will hold 49 percent.
The Chinese government is backing a homegrown technology -- TD-SCDMA (time division-synchronous CDMA) -- for the next wave of mobile phones.
Like the push to sideline Microsoft and MPEG video standards, the move is seen a way for China to develop its own IT industry free of licensing fees paid to Western firms.
CDMA2000, for example, is technology owned by US-based chipmaker Qualcomm.
State-owned Datang Telecom Technology and Industry Group is the principal supporter of the new technology, and is promoting it as a local alternative to standards used outside the country, according to wire agency Dow Jones.
Recently, Canadian networking equipment manufacturer Nortel launched a new TD-SCDMA laboratory with Datang in Beijing. Nortel will provide the core network, while Datang provides the access network.
However, the Chinese standard is not expected to replace better-known international standards such as WCDMA (wideband code division multiple access) and CDMA2000.
TD-SCDMA technologies and products have become "mature", according to the joint Siemens-Huawei statement.
The Chinese Ministry of Information Industry allocated 155 MHz spectrum to TD-SCDMA in October 2002, paving the way for the commercial use of the standard in China.
Both Siemens mobile and Huawei Technologies are "confident that TD-SCDMA will succeed in the China and could encourage operators outside of China to adopt the standard", said the statement.
"The TD-SCDMA standard can satisfy the requirements for stand-alone networks for large geographic coverage, and can also provide complementary solutions to GSM or W-CDMA networks to meet specific market demands," it continues.
TD-SCDMA infrastructure products are undergoing field tests in China at the moment, with the first commercial products of the joint venture to be available in China at the beginning of 2004.
