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GSM gaining ground in North America

The cell phone standard that dominates Europe is growing three times faster than Qualcomm's Code Division Multiple Access, challenging CDMA's hold on North America.

A cell phone technology that dominates Europe is now the fastest-growing standard in North America, according to a trade group.

Chris Pearson, executive vice president of mobile trade organization 3G Americas on Wednesday said North American use of the Global System for Mobile Communications (GSM) standard increased 57 percent from June 2002 to June 2003. That's three times faster than the growth of Qualcomm's Code Division Multiple Access (CDMA), which has dominated the North American market. He cited new cell phone market data from EMC, which publishes the EMC World Cellular Database.

The news is troubling for Qualcomm, Pearson said, because GSM is apparently beginning to challenge CDMA's stranglehold on the North American cell phone market. However, he conceded that GSM has a long way to go, because there are 71 million North American CDMA phones versus GSM's 22 million.

"In the United States, especially, CDMA (cell phone providers) were the leaders as far as number of subscribers, but that's changing," he said.

Representatives from the CDMA Development Group, a CDMA trade organization, did not immediately comment. Two Qualcomm representatives did not return phone calls seeking comment.

The number of North American GSM subscribers is expected to grow to at least 55 million once , AT&T Wireless and T-Mobile USA finish converting their subscribers to GSM.