SEOUL - A
South Korean technology start-up said Monday it
has developed a mobile phone with LG Electronics
Inc, using its home-grown core semiconductors for
cellular phones, a move expected to reduce the
market dominance of the US wireless chipmaker,
Qualcomm Inc.
In a media release, Eonex
Technologies Inc said the new model, N1000, will
soon go on sale to subscribers of SK Telecom, the
nation's leading wireless operator.
Eonex
said it is working with domestic and foreign
handset manufacturers to develop additional mobile
phones equipped with their own chip for launch
during the first half of next year.
"The
mobile phone's successful launch is expected to
spark a change in the global wireless chip market
that has been dominated by Qualcomm over the past
15 years," said Chun Sung-hwan, the company's
chief executive officer. "In addition, it will
help South Korean handset manufacturers save their
significant bill from having
to buy Qualcomm chips."
Semiconductors
made by Qualcomm, the world's second-largest
wireless chipmaker, dominate as the core component
of mobile phones running on code division multiple
access (CDMA) technology.
Qualcomm, which
holds key patents on the CDMA technology, earns
some of its profit by collecting royalties from
handset manufacturers such as South Korea's
Samsung Electronics and LG Electronics, the
world's third and fourth largest mobile phone
makers, respectively.
Currently, South
Korea's mobile phone makers spent about 3 trillion
won (US$2.83 billion) a year buying chip sets from
Qualcomm, Chun said.
Eonex is one of four
companies in the world to make and sell chips that
run the CDMA-based mobile phones, according to the
company statement. The other three companies are
Texas Instruments of the US, Philips of the
Netherlands and VIA Telecom of Taiwan, it said.
Qualcomm's Korean unit officials were not
immediately available for comment Monday.
While Qualcomm developed the core CDMA
technology in the early 1990s, South Korean
companies were the first in the world to
commercialize it.
Under the "most favored"
agreements with South Korean companies, Qualcomm
collects 5.25% of revenue from local sales of CDMA
handsets in royalties and 5.75% of CDMA export
earnings from domestic manufacturers, according to
sources.
However, some South Korean
handset manufacturers have complained about
Qualcomm's move to offer cheaper royalties for
companies in China.
