BenQ Announces World First Phone
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BARCELONA (Reuters) – BenQ Mobile said it will bring the world’s first HSDPA mobile phone to market around the time of the soccer World Cup in Germany that starts in June,

It is not sure though, whether networks will be ready in time. HSPDA (high-speed downlink packet access) promises high data speeds similar to those of fixed-line broadband networks, but mobile operators and handset makers have been waiting for each other to make the first move, reluctant to invest too early.

Samsung Electronics, the world’s third-biggest maker of mobile phones, was the first to announce an HSPDA phone last month. But BenQ said on Monday its handset would go on sale sooner, as it was based on an earlier version of a Qualcomm chipset that Samsung would also use. Chief Executive Clemens Joos told Reuters he expected European operators to start upgrading their networks and then rolling out HSPDA networks in the second half of the year.

But it was important for BenQ to get its HSPDA phone out early to show it was speeding up the rate at which it could get new products to market — a key plank in Joos’s strategy to turn around the former Siemens loss-making business.”I do not believe the phone will be an important part of our portfolio but we had to show we have the functionality and we could make a phone out of it,” he said in an interview.

BenQ was catapulted into sixth place in the world’s ranking of mobile phone makers when it took over the handset business from German conglomerate Siemens last year. Joss said he doubted that as many as six million to 10 million HSPDA phones would be sold this year, as Samsung’s telecoms networks chief Ki Tae Lee predicted earlier on Monday in a Reuters interview. “I’d be very surprised,” he said.

But he said he believed HSPDA had the potential to take off in a way that ordinary third-generation (3G) telephony failed to despite years of hype, thanks to its much faster download speeds and lessons learned from the 3G experience. If it takes off, HSPDA will benefit operators as well as consumers by making more efficient use of bandwidth, which is in increasingly short supply as services such as video streaming use up far more of it than voice calls.

Joos said BenQ Mobile already had HSPDA agreements with Deutsche Telekom’s T-Mobile and Vodafone, and that he was in talks with many other operators. BenQ’s HSPDA phone, the EF91, has a clamshell design with rounded edges and a metallic finish in a choice of colors. BenQ Mobile also launched two other phones in Barcelona: the slim-line multimedia S81 and the EF91 music phone, which has a music control pad that can be used when the phone is closed.

GERMAN PRODUCTION THREATENED

Joos reiterated that BenQ aimed to be profitable by the end of this year. “We want to be profitable in the fourth quarter,” he said, but declined to say what type of profit that would be. He added that a decision about whether and to what extent to keep production in Germany was still pending negotiations with trade unions, which he expected to start in six to eight weeks.

“Production in Germany is always threatened, that’s clear. It depends on what kind of deal we get with the unions,” he said. “If a deal isn’t struck by June, then we have a challenge.” BenQ Mobile inherited from Siemens a deal struck with thousands of employees at production sites in Germany that they would work longer hours in exchange for job guarantees. That agreement expires in June, and unions have so far declined BenQ’s offer to extend the deal, BenQ says.


By: Georgina Prodhan

Copyright 2006 Reuters.