Motorola sees $50 b. 3G market in Asia

HONG KONG: Telecommunications equipment and chip maker Motorola Inc. said on Monday that it is talking to wireless carriers throughout Asia to sell its network systems for high-speed third generation (3G) wireless services. Bo Hedfors, President of Motorola's network systems segment, which builds the equipment running wireless communications systems, told Reuters the opportunities presented by 3G services would create a $50 billion market in Asia over the next four years.

"The business model for 3G is valuable," Hedfors said in an interview, "We value the total 3G market globally as being $200 billion, $112 billion will be in Europe, and about $50 billion is in Asia." Hedfors said that Motorola was talking to carriers in Hong Kong, China, Singapore, Thailand, as well as Australia.

Although he declined to comment on where those discussions were heading, he said: "China is going to be aggressive in building 3G-type services." As the global wireless market moves toward 3G services, which offer faster connections capable of carrying video and CD-quality sound, carriers will have to upgrade their systems using technology offered by companies like Motorola and Japan's NEC Corporation.

The high price of upgrading, plus the added burden of paying for government licences in some countries, have weighed on telecoms stocks worldwide in the second half of this year. Hedfors said that Motorola, which is the world's number two manufacturer of cellular phone handsets, was in a strong position to offer both network and handset services as 3G technology begins deployment in 2001.

Hedfors said that 3G systems installation would begin in Europe in the second quarter of 2001. Motorola's network systems business is expected to grow by as much as 25 percent in the current business year, the company said earlier this year.

<P class="smartcomment>(C) Reuters Limited 2000.