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U.S., EUROPEAN EXECS AGREE ON HARMONIZED 3G CDMA FRAME WORK

WASHINGTON-In potentially a major breakthrough in the gridlocked third generation mobile phone
controversy, U.S. and European wireless executives here last week agreed to pursue a framework for an umbrella Code
Division Multiple Access standard that combines common elements of competing CDMA technologies and gives
operators the ability to choose from three different CDMA modes.

The modular CDMA harmonization approach
was proposed by Roland Mahler, executive vice president of new business at DeTeMobil Deutsche Telekom MobilNet
GmbH, at the TransAtlantic Business Dialogue forum last Wednesday.

The TABD gathering was a follow-up to one
in Charlotte, N.C., last November.

The Mahler plan could help salvage a global wireless standards process that at
times has been on the verge of implosion. A 3G CDMA compromise also could help avert a U.S.-European Union trade
war over mobile phones.

Unlike past meetings where confrontations have erupted among warring 3G wireless
parties, last week’s TABD conference was described as positive and upbeat.

The three modes in the Mahler proposal
include one resembling the European wideband CDMA standard championed by Sweden’s L.M. Ericsson and Finland’s
Nokia Corp.; a multicarrier mode resembling the cdma2000 technology promoted by Qualcomm Inc.; and a time-
division duplex mode for unpaired spectrum.

The new plan could pave the way for a smooth migration to 3G for
existing CDMA carriers as well as for carriers in the United States and abroad that deploy wireless systems based on
Global System for Mobile communications technology.

The tough part will be translating the Mahler CDMA
harmonization concept into technical specifications within the International Telecommunication Union standardization
process.

There is another big obstacle, too: The one standard, three-mode CDMA proposal does not resolve
hotly contested differences between Ericsson and Qualcomm on chip rates and intellectual property rights.

While
calling last week’s TABD developments very positive, William Plummer, Nokia’s vice president of U.S. government
relations cautioned: “We’re a long way from a CDMA umbrella standard.”

The ITU is
approaching a March 31 deadline to settle on what many observers predict will be a family of 3G standards that could
include a harmonized CDMA standard and a 3G Time Division Multiple Access standard.

There was support at the
TABD meeting, according to participants, to move forward and stick to that deadline. The meeting was not open to the
press.

A joint communique being finalized on Friday was expected to include language supporting multiple 3G
standards. There was an effort to have the communique stress that patent disputes and politics-including saber rattling
by U.S. officials over EU trade policy that discriminates against American-developed CDMA technology-be kept out
of the ITU standardization process.

Several members of the Senate have urged U.S. trade representative Charlene
Barshefsky to include the CDMA technology lock-out in Europe in an upcoming trade report on hot spots that may
require tough U.S. responses.

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