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By Peter Wilson
Originally Published: June 12th, 2003
By: The Vancouver Sun
There are 220 million cellphone users in China -- and five million are being
added every month.
With just 200 million landline subscribers in a country of 1.3 billion,
and an infrastructure in rapid transition, there's little doubt that China's
communication future lies with wireless.
It's no wonder then that British Columbia-based wireless firms are making
the move into this exploding market. And it's not just the big players taking
part.
Smaller firms -- among them fSONA Communications, Contec Innovations and
Telos Technology -- are bringing their expertise to bear. And they all say
the key to getting a solid foothold in China, especially with its changeover
to private enterprise, is finding the right partners.
"This is largely true everywhere, but just more so in China,"
said fSONA senior vice-president of marketing Mike Corcoran, whose company
has a partnership with Shanghai Telecom, a subsidiary of China Telecom.
"You really need an experienced partner, someone who understands the
business culturally and also has the ability to track and understand the
changes that occur, because change is the order of the day."
Contec's president Perry Quan, who gained a lot of experience doing business
in China when he worked with Glenayre Technologies, agrees.
"Today, as always, relationships are very important in China and we've
been able to establish a partnership with Beijing Xiejin and build a strong
relationship with them. And they, in turn, have a strong relationship with
China Unicom. I think that's essential to be successful there."
He also sees the situation in China as being fluid.
"I think it's a huge opportunity, but the rules are quite fluid in
terms of the business models and so on," said Quan. "I think it
will be somewhat chaotic because things are going so fast and the business
models and the legal systems aren't as mature as they are in North America.
"So we're going to have to be flexible and adaptable and be able to
thrive on chaos."
Telos president Jack Mar, who had a joint-venture company that, back in
1985, manufactured optical fibre in China, says that the situation is much
easier now.
"Probably the best advice I can offer is that one should look at China
the same way you do business everywhere. You have to go through the same
criteria. Is this the right partner? Is there a synergy? Do they have the
right background?
"I think people go into China thinking, 'oh, China is different' and
so forth. But I think, from a point of business sense, it's the same.
"Maybe the method of doing business is slightly different -- when
you go to different countries it's always a little bit different. But the
business sense is the same, no matter where you are."
Corcoran said that fSONA began by seeking out potential partners through
trade shows, and used them as an initial step in a getting-to-know-you exercise.
"One of the greatest challenges is to determine, as a small company,
who to partner with. Conducting direct sales from Vancouver into any market,
particularly Asia, is fraught with danger."
None of the three companies has its own offices in China, but, for now,
rely on their partners, frequent visits and constant Internet contact to
keep information flowing.
"We had a choice," said Corcoran. "Sure we could have created
an office there and supported our own product line at great expense, without
the benefit of many years of having operated there."
All of the companies agree that it would be a major mistake not to think
of the Chinese as being well aware of the latest in technological advances
and keen observers of their partners' performance.
"It's a whole different ballgame there now," said Corcoran, who
worked in China in the 1980s. "They're privatized, they're highly competitive
with each other. China is making great strides. I'd say it's two steps forward,
one step backward, which is about as good as you're going to get.
"China has a wonderful, bright future, and you have to treat them
just as if they're a first-world customer. They're every bit as demanding
as a Verizon would be in New York or a British Telecom would be in London."
Corcoran said he knows that some people don't treat the Chinese customer
with respect.
"And to say that is foolhardy and foolish is beyond belief. These
people are really, really sharp and they demand the best."
Mar said that while in North America people -- even engineers -- are unlikely
to be aware of what is happening outside their own field, this isn't so
in China.
"Part of this may be because of the Communist ideals before. A lot
of the television shows, a lot of the documentaries, talk about manufacturing
plants, steel plants, car plants and so forth. And so a lot of people have
been able to understand as they grow up how these things work.
"Even in newspapers they talk about steel plants, how 3G wireless works
and all these other subjects."
- - -
WHAT FSONA, TELOS AND CONTEC ARE DOING IN CHINA:
fSONA Communications (www.fsona.com) is working with Shanghai Telecom --
a subsidiary of China Telecom -- to improve the quality of their networks
with advanced optical wireless technology.
fSONA's SONAbeam uses invisible beams of light to transmit high-speed communications
wirelessly.
Shanghai Telecom sees potential for optical wireless to upgrade their networks
with emergency backup and disaster-recovery services.
"Initially, Shanghai Telecom viewed us as a means to get to the customer
quickly to provide fibre-like quality," said fSona's marketing vice-president
Mike Corcoran. "Then they chose to put us in to protect existing fibre.
"The problem with buried fibre, particularly in a place like Shanghai
-- and, for that matter, all populated areas in China -- is it's one big
construction zone. And fibre cuts are a huge, awful problem."
Another division of China Telecom, Guangdong Telecom, has also completed
a successful three-month trial of the SONAbeam and has shortlisted fSONA
for the next stage of their trials.
TELOS Technology (www.telostechnology.com) is working with the Putian Institute
of Technology --the research and development arm of China Putian, the largest
telecom manufacturer in China -- to bring a state-of-the-art all-IP (Internet
Protocol) wireless network to the Chinese market.
TELOS provides distributed mobile switching solutions for voice and data
communications networks, with its Sonata SE product at the heart of its
technology.
The two companies are working together in developing a 3G network based
on advanced R5 network architecture -- making a two-step jump beyond the
R99 architecture being use in North America today.
Such a network will bring extensive, feature-rich voice, data and multimedia
services to the China market.
TELOS president Jack Mar said that this is being done in preparation for
licensing of 3G in China.
"Because of the timing it may be worthwhile for the China market to
skip the R99 and R4 architectures and go directly to R5.
"China will probably offer the 3G licences either at the end of this
year or the beginning of next year. And we'll be ready for that."
Contec Innovations has entered into an agreement with Beijing Xiejin Technologies
to support the launch of U-Map mobile data services for China's second largest
mobile operator, China Unicom.
Initial phases call for Contec to provide the company's Hornet mobile application
server and integration services to Beijing Xiejin as infrastructure support
for Unicom's location-based services.
U-Map trials are being planned in major cities such as Shanghai and Beijing
and a nationwide launch of the location-based services is expected late
in 2003.
U-Map will use a mobile handset with a high-resolution colour display for
maps.
"With this service, maps would be downloaded to the mobile handset
and the subscriber would be able to see a map and their position within
the map," said Contec's president Perry Quan.
"So, they can use the service for navigating around the city. And
the handsets also have a built in compass, so there's an arrow the shows
your direction.
"There are other services planned, like a friend finder, so you can
see your friends on a map relative to your position."
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