LG-KU250.jpgChina
will soon start building a 3G mobile telephone network, but will anyone
use it? That has been the issue that has dogged the mobile telephone
industry in other countries, where uptake of new 3G services has
invariably failed to live up to the industry's expectations.

A big stumbling block is price. New 3G handsets are invariably much
more expensive that their 2.5G counterparts, particularly in the first
year or two. In a bid to address this issue, the GSM Association last
week unveiled the fruits of its “3G for All” programme at the 3GSM show in Barcelona.

The aim of the 3G for All project is to bring 3G multimedia services
and mobile internet access to many more people in both the developed
and the developing worlds. This is done by lowering costs for handset
makers and their component suppliers by identifying common requirements
across operators and enabling economies of scale.

As price is obviously a big barrier, particularly in the emerging
markets, the group decided that the phones to bear the “3G for All”
label should have a street price of less than $100. Now, that still
seems expensive in our opinion, particularly for markets like India or
China. But presumably economies of scale will rapidly drive down the
price.

A consortium of 12 large mobile operators — none of them Chinese —
selected the phone that most met these requirements and at Barcelona,
the lucky phone was announced.

And the winner is… LG Electronics with its catchily named LG-KU250/U250, shown in the picture.

China could benefit considerably from a similar initiative because
of its huge customer base as the economies of scale can potentially
drive down prices much faster than in other markets where 3G has been
launched. It could also make up for the disadvantages that China's
home-grown 3G standard, TD-SCDMA has not least the luke-warm support
from China's own mobile operators.

So, the TD-SCDMA Alliance recently announced it would take a page out of the GSM Association's book and is trying to work out how to make TD-SCDMA handsets for around $100.

Of course its a bit difficult to sell 3G phones at any price if the 3G networks are net yet operational…

More on China's 3G delays in this earlier story.


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