2001: The New 3G Odyssey

It's the stuff of legend. Startling visual imagery. Sweeping symphonic sounds. Disbelief is suspended. And a moment of limitless possibility is born. For the wireless industry, the "moment" came not in a 2-hour premiere in Hollywood, but in a 15-minute press conference in New York, the effects of which "will be felt to the far reaches of the globe," according to Sven-Christer Nilsson, Ericsson president & CEO. These opening strains announced what's already being labeled an historic resolution forged between wireless giants Ericsson and Qualcomm.

The agreement purports to pave the way for 3G progress in three ways. First, the agreement resolves the patent dispute between Ericsson and Qualcomm over the IPR rights to CDMA technology.

"These two companies have finally decided, 'Let's move forward,'" said Perry LaForge, CDG executive director. The result is the CDMA "migration path into 3G."

To kick-start this migration, the two companies will enter into cross licenses for their respective patent portfolios offering the new CDMA technology to the rest of the industry on "a fair and reasonable basis free from unfair discrimination." As part of the deal, Ericsson will purchase Qualcomm's terrestrial CDMA wireless infrastructure business, including its R&D resources in Boulder, CO, and San Diego. Through this acquisition, Ericsson now can enter the competition in CDMA in North America, and Qualcomm can exit an unprofitable sector so it can focus on what it does best.

The two companies further agreed to jointly support the ITU, TIA, and ETSI's approval of a single CDMA 3G standard that encompasses three optional modes of operation (direct sequence FDD, multicarrier FDD and TDD). All three modes will support operation with the two major existing networks -- GSM and ANSI-41 (used for CDMA and TDMA).

"This tri-mode system will allow expansion of existing and new wireless services to proceed smoothly, with significant benefits to consumers worldwide," said Irwin Jacobs, Qualcomm chairman & CEO.

>From a network perspective, everyone agreed that this "expansion" will >occur -- just not on how "smoothly."

LaForge likened the building out of existing networks to ensure new standard compatibility to "jumping off a building and trying to build a parachute on the way down."

Jeff Belk, Qualcomm vice president for marketing, said that implementation of the new CDMA standard shouldn't be as risky a fall since it is "backwards compatible with both the other existing network structures."

The TDMA camp maintained that "it's too early to tell" what the full effect of the Ericsson-Qualcomm agreement will be on its path to 3G.

"Right now we're looking at it as good for the industry," said Chris Pearson, UWCC vice president of marketing. He remained focused on the ITU's endorsement of a family-of-standards approach to 3G. "In a sense the ITU is endorsing free and open competition (which is) generally good for the world marketplace," Pearson said.

Competition is good. On this point, everyone agreed. And if the agreement on a single CDMA is truly a preview of 3G's global future, the competition is just heating up.