LG has unveiled its range of CDMA handsets suitable for the Indian market. Tae Kweon Baek, head, (CDMA terminal division), LG Electronics, who was in Hyderabad for the launch of LG’s CDMA handsets, spoke about the company’s plans in India, and about the telecom market in general. Excerpts:

What is your assessment of the Indian telecom industry?
There is a big opportunity for us in the Indian subcontinent, simply because of the sheer size of the market and the potential. The future is bright for the Indian telecom industry and we are going to play a vital role in the overall scenario.

What is LG Electronics’ focus in India, as of now?
We want to be a name to reckon with when it comes to the telecom sector. Everyone knows what LG is but still people don’t associate us with telecom and we want to change that. We are envisioning ourselves to be one of the top five worldwide handset makers by 2005. We are planning to develop CDMA, 3G, and GSM handsets, and aggressively advance into the international markets. We have set aside a budget of $5 million, major portion of which would be used for promotional activities.

One thing that separates us from our competitors is that we have always thought of the handset market as the fashion market, and hence we emphasize on design and quality, while our competitors focus on cost and cost-cutting. We have already bagged the Reliance order worth $100 million for CDMA handsets. We also want to build business partnerships with the leading Indian telecom operators for mutual cooperation, co-marketing, and other meaningful arrangements.

The cost of a basic CDMA handset is still much higher as compared to a GSM one...
Yes, it’s a bit high as of now, but we cannot do anything about this, as we supply the sets to the operators and it is up to them to decide on the cost factor. For example, we have given CDMA handsets to Tata in Hyderabad and they are selling it in the range of Rs 7,500–8,500.

The cost is totally controlled by the operator, but we hope that after sometime the cost of CDMA handsets will come down as the market penetration increases. We are directly selling our handsets to operators, so they control the price for the end user.

Do you think CDMA handsets will outgrow the number of GSM sets in the country?
During the recent ruling by the Supreme Court on the CDMA front, two elements came out—one is that this technology is for the masses, hence it should be encouraged, and the other is related to the current penetration level in India. I think CDMA has a good future in India, as the need for such mobile handsets is huge here.

Any plans to tie up with Surana on the manufacturing front...
We are seriously looking at manufacturing of handsets in India, but that would be done solely by LG. We took some help from Surana Telecom and ITI when we had bid for the BSNL tender. We have won the tender and are now supplying about 600,000 sets to BSNL.

Will you be manufacturing GSM handsets as well?
In India, 60–70 percent of the GSM market is gray, and that’s why we kept ourselves away. But once we get into manufacturing, it will be both for CDMA and GSM.

Zia Askari
Cyber New Service