Motorola (NYSE:MOT) and Telsim, Turkey's fastest-growing GSM operator, have signed a Memorandum of Understanding (MoU) agreement for the supply and deployment of a third generation (3G) mobile network capable of providing advanced multimedia services. Motorola estimates that the potential value of the contract could be in excess of $2 billion.
The European member of the IMT2000 family of third generation (3G) cellular mobile standards is known as UMTS - Universal Mobile Telecommunications System. Telsim initially plans to deploy Motorola's UMTS solution in Turkey's capital city and economic centre Ankara, and in its largest city Istanbul. Telsim, which had two million customers at the beginning of the year and now has over five million customers, estimates its growth to be seven and a half million customers by the end of the year - a growth rate this year of 375 percent.
With the advent of UMTS, Telsim's customers can look forward to totally interactive services delivered to their 3G terminal of choice whenever, wherever and however required. Combining voice, video and data, 3G technologies will transform the Internet into a true mobile resource. Motorola, through its strategic alliance with Cisco Systems, Inc. (NASDAW:CSCO), is developing a common, IP-based architecture designed to integrate voice, data and multimedia communications networks.
In Europe, the new UMTS networks will build on the success of GSM, and on the GSM operators' existing investment in infrastructure. The first stage of 3G service and network evolution is from today's GSM systems, through the implementation of General Packet Radio Service (GPRS), to UMTS networks that are expected to begin deployment next year.
Telsim launched the first commercial GPRS network in Turkey in August, becoming one of the world's first cellular network operators to implement GPRS. The launch came just four months after the successful completion of the technology trials and the first live GPRS call in Turkey, enabled by the core GPRS network solution supplied by Motorola and its strategic alliance partner, Cisco Systems, Inc. Motorola, through its alliance with Cisco, is the only supplier worldwide with complete end-to-end GPRS solutions in commercial service.
In February this year, Motorola and Telsim announced an agreement for Motorola to provide infrastructure, handsets and associated services to expand Telsim's GSM network. Telsim said it chose Motorola based on its ability to provide market-leading solutions that could handle high capacity traffic on large subscriber-base networks. As part of the agreement, Telsim named Motorola as its exclusive regional supplier of GSM 900 equipment over the next three years. Motorola has estimated that revenues from this supplier agreement could be at least $1.5 billion.
Hakan Uzan, CEO of Telsim said: "The potential of the wireless Internet is now beginning to be fully recognised by the wider marketplace. Following our successful introduction of GPRS with Motorola and exceptional growth of our GSM network, the arrival of the third generation service will take both Telsim and our subscribers to the next level of personalized anytime/anywhere access to messages, telecommunications, data, multimedia and the Internet.
"Reliable, proven solutions and system dependability are the key to 3G success," said Mr. Uzan. "Motorola's successful track record in GSM, and its leading position in the commercial deployment of GPRS, will be the key factors in delivering a proven 3G technology. Motorola clearly has an industry edge."
Gene Delaney, Motorola senior vice president and general manager of the Telecom Carriers Solutions Group, said: "The commercial success of the next generation networks is related directly to their accessibility - determined by the communications infrastructure. The Internet has proven the value of a universal, accessible, versatile network, and Motorola is extending that vision to wireless with our Aspira™ architecture that develops total communications solutions specifically designed for 3G." About Telsim
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