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    • BACKGROUNDER June 14, 2004 3G on a roll: WCDMA is ready for primetime Following a longer than expected wait, the future has never looked better for WCDMA 3G. A number of important developments have converged to accelerate the mass deployment and adoption of WCDMA 3G around the world. The potential is there, the technology is being rolled out, and Nokia is leading the way. The stage is set The potential for WCDMA 3G is huge. Operators with WCDMA licenses already have a customer base of over 500 million 2G subscribers, representing a massive pool of potential 3G customers. Today there are already close to six million WCDMA subscribers, a number that is set to grow to at an accelerated pace with more WCDMA networks opening almost every week. In 2004, the introduction of both 3G networks and terminals is dramatically moving ahead, making this the breakthrough year for 3G. Full-scale 3G network launches are proceeding, with 33 commercial launches to date (15 supplied by Nokia), a number that is expected to reach over 60 by years’ end. The stage is also set for a proliferation of 3G handsets during 2004, bringing 3G subscribers a wide assortment of attractive devices to choose from. To date, Nokia has introduced three 3G devices: the Nokia 6650, Nokia 7600 and Nokia 6630, all of which deliver industry-leading performance in 3G environments. The Nokia 6630 megapixel device is the world’s first mobile phone to combine the benefits of 3G, EDGE and the leading smartphone platform Series 60. Offering always-connected e-mail, mobile broadband access to multimedia content, live video streaming and video conferencing, it makes 3G a reality for a growing number of people. A worldwide audience In key regional markets, WCDMA 3G is progressing strongly. Japan saw the world’s first launch of 3G, by NTT DoCoMo in October 2001, and today Japan has the largest 3G subscriber base of any market, served by two 3G operators. The number of mobile subscriptions in China reached 300 million in 2003. Mobile fixed substitution has already occurred in China, ahead of the global trend, with mobile network subscriptions surpassing fixed network usage. The success of GSM is a solid foundation for the future success of 3G. Currently the 3G licensing is expected to take place in 2005. Field trials of the different technologies (WCDMA, CDMA and TD-SCDMA) are scheduled to be concluded in September. The USA is another key market for WCDMA growth opportunities. The majority of mobile networks in the US market today deploy GSM/EDGE or CDMA technology. This will also be reflected in 3G. Mobile usage in the US is characterized by high ARPUs, bundled service packages, charging for received calls, and low levels of revenue from mobile data. WCDMA 3G will be deployed using the existing 850/1900 MHz frequencies, and licensing in new frequency bands will take place probably next year. Commercial HSDPA functionality in networks and terminals is expected within 2005-2006 timeframe.
    • BACKGROUNDER June 14, 2004 Europe has enjoyed the widest WCDMA 3G deployment so far. A total of 93 licenses for 3G have been issued in nearly 30 countries in Europe, with more to be granted this year and afterward, especially in important markets in eastern Europe such as Russia. Also, the majority of the world’s commercially launched WCDMA 3G networks are located in Europe. Latin America is experiencing a mass migration away from AMPS, TDMA and second generation CDMA to GSM. In 2003, the subscriber base for GSM increased by nearly 150% in 2003, growing almost six times faster than the second most popular technology in the region, according to the 3G Americas industry association. Nearly 90% of new Latin American subscribers during the 4th quarter 2003 were GSM subscribers, according to EMC. For 3G, networks in Latin America will use US frequencies, and licensing will not take place until 2005. Nokia takes the lead role Nokia’s position in WCDMA 3G is strong in all markets. Nokia has over 40 WCDMA 3G operator customers and has provided networks to almost half of the over 30 WCDMA 3G commercial networks launched today. Nokia has also taken a leading role in further developing 3G technology. Nokia is at the forefront of research in High Speed Downlink Packet Access (HSDPA), a natural evolution to WCDMA 3G that will bring even higher data speeds with a simple software upgrade to Nokia’s existing WCDMA 3G radio network. In many markets WCDMA 3G will co-exist with EDGE, a high-speed enhancement to GSM. As a complementary technology to WCDMA, EDGE has already seen wide-scale deployment and global commercial use. To date, there have been 16 commercial EDGE network launches and a total of some 70 network deployments worldwide. Nokia’s track record in EDGE is also clear. Nokia has delivered GSM/EDGE hardware to nearly 80 customers in 38 countries, mostly in Europe. Of these, Nokia has 27 public EDGE references and has supplied 12 of the 16 launched networks, including AWS, CSL Hong Kong, Telefonica Movil Chile and TeliaSonera Finland. Of Nokia’s entire deliveries of GSM base stations 2H 2003, 75% were EDGE capable. On the terminal side, Nokia has introduced 12 models of EDGE phones, and expects to ship close to 100 million by 2005. Virtually all new Nokia GPRS and WCDMA terminals will be EDGE capable.