M-TAIWAN PROJECT: The agreements to set up R&D and testing centers should help speed up the nation's deployment of wireless services, the ministry said

By Lisa Wang

Tuesday, May 15, 2007

The Ministry of Economic Affairs (MOEA) inked major agreements with three foreign companies yesterday, paving the way for the establishment of a research and development center and a testing center in line with the government's aim of developing WiMAX-related equipment and wireless devices through a NT$7 billion (US$210 million) program called "M-Taiwan."

The ministry signed a memorandum of understanding with Japan's NEC Corp to set up a next-generation wireless broadband, or WiMAX, research and development center this year.

The R&D center would be open to local equipment vendors to enable them to perform interoperability tests and to support service providers and software vendors in the development and verification of application services, NEC said yesterday, adding that the center should be set up within the next year.

NEC said it is also working with Taiwanese home appliances manufacturer Tatung Co -- which is expected to bid for a WiMAX license in next month's auction -- in a WiMAX trial.

The Japanese company has helped Tatung conduct trials of Internet access and video streaming in Hualien on WiMAX equipment.

NEC bought US$3.8 billion worth of electronics products from Taiwanese companies last year, putting it among the top 10 foreign purchasers from local firms, the ministry's data showed.

The ministry also signed agreements with Canadian telecom equipment supplier Nortel and German electronics firm Rohde and Schwarz (R&S) to set up a laboratory to develop and test all types of WiMAX technologies and applications and to boost cooperation between the companies and local firms in developing WiMAX technologies and WiMAX-enabled devices.

"The agreements will promote cooperation between Nortel, NEC and R&S and local network and communications manufacturers and pave the way for Taiwan to establish a state-of-the-art WiMAX wireless broadband network, helping to raise the global competitiveness of Taiwan in the WiMAX industry," Minister of Economic Affairs Steve Chen said at the signing ceremony.

Overall investment by local companies on WiMAX-related equipment and research and development may reach NT$80 billion in the next few years, Chen said.

Taiwan's WiMAX trial center has been approved by the WiMAX Forum, making it the fourth country in the world to have such a laboratory, the ministry said.

The WiMAX Forum, set up in June 2001, is an industry-led, not-for-profit organization formed to certify and promote the compatibility and interoperability of broadband wireless products based upon the mobile WiMAX technology.

The first round of applications for six WiMAX licenses will close on June 11, and selected firms will take part in an auction for the permits in July, National Communications Commission (NCC) chairman Su Yeong-chin said yesterday on the sidelines of an industry event yesterday.

"Fourteen companies have come in for a briefing with the commission and have shown interest in getting a license," Su said.

Bidders will pledge a percentage of their annual sales from WiMAX rather than pay a flat fee for the licenses, said Wang Der-wei, a senior engineer at the commission's planning department.

Winning bidders will be those that offer the highest share of revenue, he said.

Wang said the government will award three licenses each for north and south Taiwan in July, with one license in each region reserved for a new entrant to the telecommunications market.

Additional reporting by Bloomberg