Kyocera, Sanyo, Fujitsu dial China for deals


Japanese manufacturers and telcos hope to export its 3G expertise to China

By CNN's Kristie Lu Stout

TOKYO, Japan (CNN) -- Japan's Kyocera, Sanyo, and Fujitsu have separately announced plans to develop mobile handsets and networks for the China market.

Kyocera and Sanyo have each inked a joint venture with Chinese firms to produce cell phones, and Fujitsu has plans to develop third-generation (3G) cell phone networks with a Chinese university, according to Japanese news reports.

The alliances reflect an escalating trend of Japanese telecom players aggressively chasing market opportunities in China.

Strategic ventures

Kyocera on Saturday agreed with China's Zhenhua Technology to establish a joint venture to make and market mobile handsets, Japan's Kyodo News reported.

With the joint venture, the Japanese industrial giant expects to produce CDMA (code division multiple access) cell phones in China before the end of the year, according to the Nihon Keizai Shimbun business daily.

Kyocera plans to turn the joint venture into a strategic production center that would supply to CDMA-dominated markets like China and the U.S.

Sanyo and a Tianjin-based firm have also partnered to produce 50,000 handsets a month starting from November.

Electronics giant Fujitsu joined forces with the South China University of Technology to develop a 3G network in China using an officially endorsed mobile standard.

Company sources at Fujitsu told the Nihon Keizai Shimbun that the Chinese government would likely adopt the networks using the Chinese-developed TD-SCDMA standard.

'Ground zero opportunity'

The latest wave of telecom joint ventures follow a burst of activity between Japanese and Chinese telecom players in China, the world's largest mobile market.

"The Japanese obviously see China as a key market," said Gartner Group mobile analyst Nick Ingelbrecht.

"It's an emerging market that presents a ground zero opportunity for telecom manufacturers."

In June, Japan Telecom and China Telecom signed a knowledge sharing agreement to establish a comprehensive tie-up in mobile, fixed-line and Internet services.

One week before the Japan Telecom and China Telecom tie-up, Japan's KDDI and China Unicom signed a memorandum of understanding, sealing a pact that analysts say will boost 3G wireless technology in China.

In May, Japan's leading mobile operator NTT DoCoMo lifted its stake in Hong Kong's Hutchison Telephone.

The Japanese mobile operator made the move hoping to leverage its board seat and accelerate the launch of 3G services in the Hong Kong market, where Hutchison was recently awarded a 3G license.

"Japanese manufacturers really want to exploit the head start it has in the 3G world, its Asian connections," said Ingelbrecht.

"From a practical perspective, any telecom manufacturer has to have a big position in China."