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Battle over wireless standards heats up

A battle over wireless phone standards intensifies as U.S. trade officials warn European representatives against limiting competition in the mobile phone market.

A cross-Atlantic battle over wireless phone standards intensifies as U.S. trade officials and regulators warn European officials against limiting competition in the mobile phone market.

U.S. officials are concerned that European efforts to settle on a standard next-generation wireless technology standard will shut some U.S. companies--such as Qualcomm--out of that market.

After receiving an explanatory letter from European Commissioner Martin Bangemann, the group of U.S. officials who have taken a lead on the issue said this week they are still concerned about the European Community's move toward favoring one particular wireless technology.

"Policies that reflected Europe's former monopolistic environment, such as mandating single standards, may have anti-competitive effects in Europe's newly liberalized telecommunications environment," said Federal Communications Commission chairman William Kennard.

Kennard's comment came in a joint reaction to the Bangemann overture along with Secretary of State Madeline Albright, United States Trade Representative Charlene Barshefsky, and Secretary of Commerce William Daley.

The four trade and regulatory officials sent European regulators a first letter indicating their concern last month, after their overseas counterparts indicated their support for a standard that competes with one developed by Qualcomm.

The European Commission backed the creation of a single next-generation standard for wireless phones, allowing customers from any part of the EC to travel between service areas and still use their mobile phones.

The Commission submitted their candidate for a single technology for consideration as a global standard by the International Telecommunications Union.

Problem is, that standard--called WCDMA--is developed by Sweden's Ericsson. Many U.S. companies are moving towards another standard, called CDMA, and Qualcomm has taken a lead in lobbying U.S. officials to make sure this standard is accepted overseas.

U.S. officials said they are worried that Europe's support of the single standard could lock other competing technologies out of the market, even if the ITU also supports the alternatives.

"The fact remains that the [European position] confers regulatory certainty and therefore a market advantage upon only one type of technology," Barshefsky said. "EC member states should now license and assign radio spectrum to the maximum number of service providers without regard to technology, based on the standards that emerge from the ITU negotiations."

The ITU is scheduled to decide by March 31, 1999 on key elements of third-generation wireless technology standards, with a deadline of December 31 for final standards recommendations.