The name is absent

paid special attention to the TD-SCDMA standard and has jointly developed it with the China
Academy of Telecommunications Technology (CATT) and Siemens. TD-SCDMA is one of the
only three international standards recognized by the International Telecommunications Union
(ITU) for 3G and is the first ITU standard proposed by China. On Oct 30, 2002, the alliance of
TD-SCDMA industry, consisting of eight domestic enterprises including Datang , Huawei,
Soutec, Huali, Legend, ZTE,CEC and Putian, was established in Beijing. Financially supported
by the Chinese government, a meeting on TD-SCDMA prototype standards was provided by
members of the Alliance in 2004 (RTX Telecom, 2003). Although Motorola, Nokia, and
Ericsson already have their own mature 3G products, these products cannot easily be introduced
into China because of different standards. China’s domestic firms have the potential of building
technological competency in this area.

Competition

In the intensely competitive handset market, domestic manufacturers compete directly
with foreign owned or joint venture rivals. China’s diverse domestic mobile phone
manufacturers have adopted a series of strategies to compete with their leading foreign
competitors. This competition has contributed to China’s success. As in many other Chinese
industries, domestic competition among China’s mobile handset manufacturers has been
regarded as more important and threatening than competition overseas.

First, China’s domestic firms focused on the low or middle-end market and initiated
severe price competition based on their advantages in low costs and local market characteristics.
The leading domestic firm, Bird, engages in competition by keeping prices lower than
comparable products (ChinaNex, 2004). Network Weekly (2004) estimates the average price of
the mobile phones sold by Bird to be about RMB 919.21 (about $110) with an average profit of

China's Mobile Handsets FINAL DRAFT 2006.sph ERSA2006 Greece

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