Semiconductor Manufacturing International Corporation (SMIC) is expected to receive a positive sales contribution from its strategic partnership with Datang Telecom Technology & Industry Holdings for the first quarter of 2009, according to sources in the China semiconductor market. The sources believed that Datang will likely beat out other major telecom equipment suppliers to win orders for a government project for TD-SCDMA wireless network equipment, and SMIC is likely to be a direct beneficiary.

The project to build TD-SCDMA commercial networks in 28 cities has drawn interest from China-based China Putian, Datang, FiberHome Technologies and Huawei Technologies, as well as Ericsson and Nokia Siemens Networks, the sources indicated. The selected companies for the bid will be released by the middle of December, the sources added.

The Datang-SMIC cooperation, which was announced on November 12, has been identified by the foundry as a gateway into the TD-SCDMA sector. According to SMIC, the expansion of the existing TD-SCDMA network will cover a total of 38 cities (10 already have network built). SMIC is preparing to move to the tape-out stage, with volume production of related telecom chips slated for next year, said the company.

Developed by the China Academy of Telecommunications Technology, Datang and Siemens AG, TD-SCDMA is China's home-grown 3G wireless standard that is actively supported by the China government. Nokia also recently expressed its commitment to TD-SCDMA while attending the Mobile Asia Congress in Macau. The Finland-based handset vendor said in the November 19 press release that it has kicked off the development of a TD-SCDMA device based on its Symbian-based S60 and the launch is slated for the end of 2009.

Source:DIGITIMES