Korean Companies, Temptation of 2 Billion Dollars Market

‘Get over the barrier of the second bidding.’

Owing to the news that the additional bidding of China for CDMA equipment is now close at hand, the related companies of Korea have highly expected.

According to the news of communication industries on July 28, China Unicom which commercialized the CDMA mobile phone service at the begging of the year will start the second bidding during this week at the earliest since the first bidding in the last April.

Ranked third in the telecommunication industries of China, China Unicom plans to upgrade 2G CDMA Network into 3G (2000 1X) system of high speed radio internet (144Kbps) through bidding. The bidding scale hasn’t been published yet, but is estimated at USD 2 billion for 10 million lines.

Korea has expected the good results in this bidding, as the CDMA company which firstly commercialized the 3G CDMA service in the world.

Samsung Electronics was recognized for a technology and stabilization through taking the additional quantity of CDMA in some areas of China at the beginning of the year. So, Samsung Electronics obtained the advantages in the second bidding. LG Electronics intended to regain a failure of the first bidding with the best commercialized- technology in the world.

In addition, parts companies including Hyundai Syscom, Ace Technology, Danam Communication, AILINTEC and SP.Comtech have counted on the exports through partnership with foreign and domestic companies, despites not participating in the bidding.

However, Major foreign companies experienced in a shrinking market are eager to win in this bidding, and so Korean companies have too many things on their hands. As of the end of June, the number of CDMA subscribers in doesn’t exceed 1 million people. So, it is worried that the quantity of the second bidding will decrease owing to slow CDMA expansion.

In this relation, Yang Jun-cheol, Director of International Relations, Minister of Information and Communication said “The second bidding will be executed soon by area. Korean companies expect experienced in the commercialization of 3G technology”.

Tae-Han Kim freewill@donga.com