Toshiba delays 3G work with Siemens

The rapid cooling of interest in third-generation (3G) cellular services among carriers worldwide is forcing Toshiba Corp. to delay its joint development work with Siemens AG. The company has also cut by more than half its forecast for U.S. handset shipments for the current year.

"The market has not developed how we expected it to develop," said Midori Suzuki, a spokeswoman for Toshiba. "We are deciding our schedule (for cooperation with Siemens) but we have no definitive schedule yet," she added. Earlier Thursday, the Nikkan Kogyo Shimbun newspaper reported Toshiba had originally planned to send 100 engineers to Germany to work with Siemens although Suzuki said no such plan had been finalized.

The two companies announced an agreement in November 2000 under which they would pool their resources to jointly research and develop technologies for 3G mobile phone handsets and terminals that can access both second-generation (2G) and 3G networks.

At the time, the companies said they expected to produce the first dual-mode GSM/WCDMA (Global System for Mobile Communications/Wideband Code Division Multiple Access) handsets by early 2002 although that schedule is now unlikely to be achieved.

"We are continuing to talk with Siemens," said Suzuki although she conceded that, as of today, no joint development has been carried out despite the passage of almost a year since the announcement of the deal.

The company also said it has cut by more than half handset shipment estimates for the U.S. market. Originally Toshiba expected to ship 5.7 million handsets to the U.S. in the current fiscal year, which runs until the end of March 2002, although that has now been revised to 2.8 million.

Japanese cellular handset shipments have been revised upwards slightly, from 3.5 million to 3.7 million and PHS (Personal Handyphone System) handset shipments revised down from 0.5 million to 0.2 million.

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