Joint Venture in 3G Infrastructure Area

ASIA : Wuhan Research institute of Post and Telecommunications (WRI) and NEC Corporation has signed an agreement to establish a joint venture in China. The new firm will engage in 3G mobile infrastructure development, manufacturing, sales, maintenance, and system engineering (wireless circuit design).

The name of the new firm will be "Wuhan Fiberhome Mobile Communication Inc.". A 65% share of the new company will be hold by WRI, a 30% share by NEC and NEC Telecom China and a 5% share by others. The new company plans to start with 100 employees and is set to be established within June of this year in Wuhan City.

WRI was established by the Research Institute of Chinese Post and Telecommunications ministry, and now one of top manufacturers in the field of telecommunications infrastructure in China. As a local vendor in China, the joint venture company will contribute to the early establishment of 3G infrastructures in China by expanding W-CDMA and developing TD-SCDMA based on NEC's state-of-the-art 3G (W-CDMA) infrastructure technology and 3G network design and optimization technologies, utilizing WRI's extensive maintenance, sales, and service network and established relationships with telecommunications carriers.

By working together with WRI, NEC gets to establish a 3G business operation structure taking strong hold in China.

NEC, together with its 3G alliance partner Siemens, has already become a leading company in 3G infrastructure with respect to orders received and extent of commercial applications. To build on this base, NEC is striving to expand the 3G infrastructure business in the Chinese market mainly through NEC Telecom (China), established in June 2004. NEC Telecom (China) will work with Siemens and also through its joint venture with WRI in an optimal formation to expand 3G infrastructure business in China.

Takakuni Kuki, Executive General Manager of NEC's Mobile Network Operations Unit commented, "NEC hopes to take a leading position for the construction of 3G infrastructure in China with its abundant technologies and experiences in 3G commercial markets in Asia and Europe. NEC will enter into a key phase of the Chinese 3G market. In order to accelerate the progress of Chinese 3G market, NEC will build up basic production as early as possible to meet the increasing demand of the market."

<NEC and 3G>
As the pioneer of global 3G WCDMA market, Siemens/NEC alliance has made outstanding achievement. It has already cooperated with more than 30 3G operators and more than 20 countries and areas. In a report from April 2005 the independent Multimedia Research Institute in Tokyo positions Siemens/ NEC in the 3G W-CDMA market as No.1 regarding commercially installed NodeBs, occupying 30,1 percent worldwide market shares.

In 2004, NEC established a 3G demonstration center in Guangdong. The center showcases NEC's 3G network solution offerings such as Node-B radio base station, radio network controller and 3G terminals, and mobile internet application platform, and demonstrates attractive mobile multimedia service using the 3G technology. The 3G demonstration center is opened to a variety of customers including telecom carriers, government agencies, as well as software vendors and application service providers who may use the center as a testing site for 3G mobile applications with actual 3G infrastructure environment. NEC is also increasing its 3G infrastructure support sites in major cities in China.

In addition, NEC recently established "NEC Telecommunications (Hong Kong) Limited", a mobile network operation outsourcing company to further expand the business of the new company to include 3G projects in China in the future. The new company marks NEC's entry into a new business area, accumulating capability in network system outsourcing with the combination of NEC's competences as a mobile network vendor and highly skilled outsourcing staff. With this new company, NEC will be ready for 3G's take-off in China market, enabling us to support global operators with its total solution capabilities.