PUBLISHED : Tuesday, 03 August, 2004, 12:00am
UPDATED : Tuesday, 03 August, 2004, 12:00am

Tibet brought up to wireless date

The last rotary phone in China, in a remote Tibetan village, has been replaced with a wireless unit, according to Xinhua. The phone had been in use at Menzhong village in Nedong County, Tibet, since 1974. Dominant fixed-line provider China Telecom has spent US$17 million building wireless infrastructure in Tibet. About 17,800 families have joined the network since its launch last year.

Mainland GSM makers may face royalty fees

Mainland manufacturers of GSM handsets could be hit with royalty fees as they increasingly export their products.

The major owners of GSM technology - such as Nokia, Motorola and Sony Ericsson - do not charge for handsets destined for the mainland. This was because they feared upsetting Chinese officials and a market which had bought several billion dollars of equipment in the past two decades, iSuppli analyst Byron Wu said.

But as excess production finds its way into the global market, technology owners may reconsider their position on royalties, which account for up to 12 per cent of a handset's cost.

'In the long run, this will hurt the interests of China's OEMs as they hope to sell more products globally,' Mr Wu added.

At the end of last year, China had capacity to produce 200 million handsets, although domestic demand for this year is forecast at just 100 million units.

Mr Wu said it remained unclear whether GSM technology would begin charging Chinese manufacturers patent fees. But as mainland producers grew in strength, their overseas counterparts might be forced to respond.

Government moves see card market get smarter

The mainland market for smart cards continues to grow with the help of government-backed mandates. China's demand for smart cards is expected to top 300 million units by 2007, according to iSuppli, compared with fewer than 100 million pieces last year.

A key driver is the issuance of second-generation residential ID cards this year, with trials starting in select cities.

Analyst Anny Li estimated output at 600,000 units this year, ballooning to 900 million units by 2010.

Another application for smart cards is equipment for value-added tax/point of sale machines.

The central government requires all retailers to install the terminals.

With 50 million enterprises, iSuppli estimated demand at 30 million units per year.