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Availability, Reliability, Device Accessibility and Economics Give CDMA2000 Operators Competitive Edge

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COSTA MESA, Calif., Aug. 5, 2002 - A recent independent equity research report on wireless technologies from Morgan Stanley, a global financial services firm and a market leader in securities, investment management and credit services, placed CDMA2000 in the leading position for delivering 3G services. Research conducted for this report was based on real-world operator experiences in Asia, the only region to have commercially available, co-existing 2.5G and 3G technologies including GPRS, W-CDMA, CDMA2000 1X and CDMA2000 1xEV-DO. An executive summary of the report titled "Wireless Technology: Who is ahead?" can be viewed on the CDMA Development Group's (CDG) Web site at

"Morgan Stanley's extensive research concluded that CDMA2000 operators are ahead of their counterparts in offering commercial 3G services," said Luiz Carvalho, managing director of wireless for Morgan Stanley. "The contributing factors to the success of CDMA2000 are the ease of migration, low capex requirements, backward compatibility allowing seamless roaming between 2G and 3G networks and lower handset pricing."

According to the report, key benefits of CDMA2000 compared to other 3G technologies include:

  • Economics - CDMA2000 requires lower capex for data network upgrades. In Japan, KDDI will invest less than 25 percent of the capital to migrate to CDMA2000 1xEV-DO than NTT DoCoMo will spend on building their W-CDMA network. Similarly, in the US, Sprint PCS will spend $8 per POP to implement CDMA2000 1xEV-DV while other operators will have to invest three times that amount to upgrade to W-CDMA.
  • Economies of scale - Morgan Stanley expects 25 million CDMA2000 1X handsets to ship versus 3.4 million W-CDMA handsets worldwide by year-end 2002. The higher volumes translate into lower costs for handsets.
  • Capacity - Capacity gains of CDMA2000 1X technology lead to much lower capex for operators when compared to other technologies.

A significant finding of the survey was that CDMA2000 delivers higher revenues for operators. KT Freetel announced that color screen CDMA2000 1X users generate 380 percent more data ARPU and 54 percent higher total revenue than their 2G subscribers. SK Telecom also recently reported that higher ARPU from 3G Internet and data services contributed to a 39 percent increase in revenue and 42 percent increase in net profits for the first half of 2002.

"Morgan Stanley's independent analysis of 3G technologies underscores that CDMA2000 is clearly leading in the delivery of 3G," said Perry LaForge, executive director, CDG. "The higher revenues, lower investment and ease of migration that CDMA2000 technologies offer make a compelling business case for operators to migrate to 3G. CDMA2000 will continue to build on this momentum in the coming months with additional commercial deployments, new devices and high-margin applications becoming available."

The CDG reports that there are 16 commercial 3G CDMA2000 networks with a global subscriber base of more than 13 million. Additionally, there are more than 124 devices providing wireless users access to 3G applications including multimedia messaging, full-color music videos, camera and motion video functionality, Internet broadcasts and animation downloaded at up to 144 Kbps on CDMA2000 networks.

CDMA2000 1xEV-DO, commercially deployed by KT Freetel and SK Telecom in Korea, allows mobile users to experience the mobile Internet and rich multimedia applications at higher data speed up to 2.4 Mbps-more than six times the speed of competing third-generation systems.

The CDMA Development Group is a nonprofit trade association formed to foster the worldwide development, implementation and use of cdmaOne™ and CDMA2000. The 110 member companies of the CDG include many of the world's largest wireless operators and equipment manufacturers. The primary activities of the CDG include development of CDMA features and services, public relations, education and seminars, regulatory affairs and international support. Currently, there are more than 500 individuals working within various CDG subcommittees on CDMA-related matters. For more information about the CDG, contact Valerie Christopherson of the CDG News Bureau at +1-714-540-1030, ext. 14, e-mail, or visit the CDG Web site at

***cdmaOne is a trademark of the CDG

Editor's Note: The Morgan Stanley "Wireless Technology: Who is ahead?" equity research report was released June 10, 2002.