"There is no manufacturing tie up with anyone as of now" Tae Kweon Baek, Head of CDMA Terminal Division at LG

As the country prepares itself for the telecom revolution, LG, a Korean company, has unveiled for the first time its range of CDMA handsets just suitable for the Indian market dynamics. Zia Askari from CNS spoke to Tae Kweon Baek, Head of CDMA Terminal Division at LG Electronics about the plans of LG in India and about the telecom market in general. He was in Hyderabad for the launch of LG’s CDMA handsets. 

How do you see the future of Indian telecom industry?

There is a big opportunity for us within Indian sub-continent simply because of the sheer size of the market and the market potential. So the future is bright for the Indian telecom industry and we are going to play a vital role in the overall scenario. 

What is the focus for LG Electronics as of now with regards to the Indian operations?

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. The company is also planning to fulfill its vision by developing new products such as CDMA, 3G and GSM handsets and by aggressively advancing further into the international markets. We have set aside a budget of $ five, million major portion of which would be used for promotional activities.

One thing, which separates us from our competition in the handsets arena, is that we have always thought of the mobile market of handsets as the fashion market so we emphasize on design and quality while our competitors focus on cost and cost cutting. We have already bagged the Reliance order for CDMA handsets worth $ 100 million and we firmly believe that quality should be maintained and this is the reason that we are going to provide customer services for our Indian customers. Phase one will cover more than 100 important cities within India and after that we will look into other far off places as well. We also want to build business partnerships with leading Indian telecom operators for mutual co-operation, co-marketing and other meaningful arrangements. 

The cost of a basic CDMA handset is still much higher when compared to a GSM one. Will it be a factor in CDMA adoption?

Yes the cost of a basic CDMA handset is 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 the CDMA handsets to Tata in Hyderabad and they are selling it between Rs 7,500 to Rs 8,500. 

The cost is totally controlled by the operator but we hope that after sometime the CDMA handset cost 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. 

Now that you have launched CDMA handsets, do you think it will outgrow the number of GSM sets within the country?

This is not the right time to comment on this but if we see both the technologies are designed for the good of common masses. During the recent ruling by the supreme court on the CDMA front, two elements came out one is that this technology is for the general masses hence it should be encouraged and the other is related to the current penetration level within India. I think CDMA technology has a good future over here, as the need for such mobile handsets is huge over here. 

There was talk about LG tying up with Surana for manufacturing front. Your comments?

Yes we are seriously looking out for manufacturing of handsets within India, but that would be done solely by LG only as we believe that we are fully capable of doing that. We took some help from Surana Telecom and ITI when we had bid for the BSNL tender. We have won the tender and now are supplying about six lakh sets to BSNL. So there is no manufacturing tie up with anyone as of now. 

Would you be manufacturing GSM handsets as well?

As of now more than 60 percent to 70 percent of GSM market is governed by the grey forces within the market and this is the reason we kept ourselves away from this. But now that we have launched our CDMA products within India, very soon we will come out with GSM products for the Indian market. And once we go in for the manufacturing it will be both for CDMA as well as
GSM.

(CNS)