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SAMSUNG Electronics Begins First Commercial Service in China

on Jun 17, 1998

- Mobile communications system goes on-line June 16.

SEOUL, Korea - June, 17, 1998 - Samsung Electronics Co., Ltd., Over the past year, Samsung Electronics Co.
successfully carried out test operation of a CDMA wireless communications system in the Shanghai area. #n June 16, Samsung Electronics and Shanghai Great Wall Mobile Communications Co. Ltd. held a ceremony to mark the beginning of commercial wireless CDMA service. #ver 250 people related to the telecommunications field were present at the ceremony, including Post & Telecommunications Mobile Communications Bureau Deputy Chief Lixiuchuan, Shanghai Great Wall Director General Wang Qingnian, Samsung Electronics Information & Communications Division President, Park,Hee-choon, and Samsung China Headquarters Vice-president, Sohn, Myung-sup.

Samsung Electronics was selected as the official supplier of CDMA equipment to Shanghai in June 1997. #fter that, Samsung Electronics carried out a turnkey project with Shanghai Great Wall involving one switching
station with a 68,000-line capacity, sixty-seven base stations and support services. #fter a year of testing, Great Wall approved the system for reliability and safety, allowing commercial service to begin.

During the testing phase, Samsung Electronics supplied 3,000 CDMA handsets, which were given a high quality rating. #reat Wall plans to extend its commercial CDMA service to twelve provinces (Shandong, Jiangsu, Zhejiang, etc.) in the second half of this year, solidifying its position as China's leading CDMA service provider.

In 1996 the Chinese government held a tender for supplying wireless CDMA systems in the cities of Beijing, Shanghai, Guangzhou, and Xian as part of a project to modernized the nation's telecommunications infrastructure. #Different companies were selected for each city and each company carried out a test system for one year.

Among the four test projects, Samsung Electronics' wt as the largest, and Shanghai has the greatest growth potential. #amsung Electronics' technology was rated highly and the company received notification of its being selected in March of last year.

Samsung Electronics has already established a joint venture company in Shanghai to market wireless local loops.
#he company is now focusing on expanding its presence in this market by selling PCS handsets, asynchronous transfer mode switching systems and other hardware there.

Shanghai CDMA Business

1. Summary
A tender was held in July 1996, with Samsung Electronics, Motorola, Lucent Technologies, Northern Telecom, Qualcomm and LG Information & Communications taking part. #amsung was selected as the supplier of CDMA hardware to Shanghai, and the supply contract was concluded in June 1997.

Organizer: #hanghai Great Wall Mobile Communications Co., Ltd. was established as a 50:50 joint venture between the Shanghai Post & Telephone Administration Bureau and the Nam-kyung-gun-gu Telecommunications.
#reat Wall is the sole provider of CDMA service for the Shanghai area.

Business Scope: Commercial wireless service is offered to the entire Shanghai metropolitan area through one switching station and 67 base stations. #he system capacity is 68,000 subscribers.

2. Significance
Great Wall has emerged as China's leading provider of CDMA services and the company is expected to play a key role in determining hardware suppliers. #he China market now can be divided among Motorola, Lucent Technologies and Samsung.

The company (Great Wall) has the vested right to supply the Hwadong region (southeast coast). #his gives Samsung a channel for expanding into the areas surrounding Shanghai, which have the highest growth potential for mobile communications demand in all of China.Samsung now has an opportunity to supply CDMa handsets and other related hardware.

3. Mobile Phone Test Projects in China

CompanyArea Samsung Shanghai (67 base stations) Tianjin (11 base stations) Lucent Technologies Guangzhou, Shanghai Motorola Beijing, Guangzhou Northern TelecomXian

4. Progress
. Jun. '97: First hardware shipment arrives in China (five base stations and one switching station).
. Oct. '97: System installation and linkup tests completed.
. From Nov. '97: Second and third hardware shipments arrive in China and are installed.
. User-friendly service available
. May '98: No. 7 #telephone network) acquired.
. Jun. 16, '98: Commercial service begins.

In Samsung Electronics Co., Ltd., there are three main business units:
. Multimedia & Home Appliances
. Semiconductors
. Information & Telecommunications.


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