Hangzhou-based electronics firm Eastern Communications Co Ltd (Eastcom) revealed Tuesday it had signed a joint venture agreement with South Korean conglomerate Samsung Electronics.

The Shanghai-listed firm's move is a bid to complete its strategic deployment for the launch of the third generation (3G) mobile communications in China.

The joint venture, Hangzhou Samsung Eastcom Network Technology Co Ltd, will be based in Hangzhou, in east China's Zhejiang Province, where Eastcom is also based.

The two companies will invest US$15 million in the new company, which has a registered capital of US$6 million, with Samsung Electronics taking a 70 percent stake in the venture.

"This joint venture is a major step in our deployment in preparation for the launch of the 3G in China," said Samsung Electronics China spokesman Li Wei.

Samsung Electronics has already developed 3G technologies based on the code division multiple access (CDMA) 2000 standard.

The joint venture with Eastcom will enable the South Korean giant to gain a foothold in the European-initiated wideband CDMA (WCDMA) standard.

It will be engaged in the research and development of WCDMA technologies and the localization of Samsung Electronics' technologies developed in South Korea.

An Eastcom spokesman said the joint venture may also produce WCDMA equipment at a later date.

Li said Samsung Electronics does not consider itself to be lagging behind its European competitors such as Ericsson, Nokia and Siemens regarding WCDMA in China.

"We are at the same starting point as the European companies and the only thing we need to do is to work closely with local partners to develop the market."

Besides the joint venture, Samsung Electronics also participated in the second phase of the MTNet trial, a 3G test organized by the Chinese Government, in co-operation with China Railcom.

Li said his company has also been in contact with other major players in the market, including China Mobile and China Telecom, to help introduce Samsung's experience in 3G applications.

He said Samsung Electronics will support all three 3G standards in China, the other one being the Chinese-initiated time division synchronous CDMA (TD-SCMDA).

(China Daily April 21, 2004)