The developer of China's first 3G mobile phone set using Chinese standards signed a letter of intent on Sunday with a telecommunications company on commercialization of the product.

Under the deal, the Chongqing Institute of Posts and Telecommunications, the developer, and China Putian Corp, the country's largest telecom equipment supplier, will jointly set up a production base in Chongqing Municipality, southwest China, for manufacturing TD-SCDMA 3G mobile phones.

They will produce the first batch of 3G mobile phones in the first quarter of 2004 for network experiments, and commercial production is expected to begin in 2005, according to the deal.

The Chongqing Institute of Posts and Telecommunications announced earlier this month they had developed the world's first 3G mobile phone set of the TD-SCDMA standard independently with all the intellectual property rights.

TD-SCDMA is the technological standard formulated by China for 3G mobile telecommunications and approved by the International Telecommunications Union of the United Nations as one of the three standards for 3G mobile phones.

The other standards are WCDMA, proposed by European companies, and CDMA 2000, by the United States. CDMA refers to code division multiple access and WCDMA is wideband CDMA.

Compared with GSM, TDMA digital mobile phones, or 2G mobile phones, and their predecessor analog mobile phones, the 3G phones are a more powerful telecommunication tool.

The 3G mobile phone is widely considered the future of mobile telecommunications, capable of providing such services as Internet webpage browsing, teleconferencing, and electronic commerce.

Chinese telecommunications giant Datang has set up an experimental network for TD-SCDMA mobile phones in Jiangbei District in Chongqing, southwest China.

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