Ericsson AG, currently SingTel's vendor for its 2G and 2.5G networks, beat four other bidders -- including shortlisted Nokia and a consortium comprising Siemens IC mobile, NEC Corp. and Itochu Corp. -- for the five-year 3G contract.

SingTel chief executive officer Lucas Chow told reporters Ericsson had offered the most attractive proposal based on price and its global expertise in mobile networks and technologies.

"Ericsson can help us deliver quality 3G services to our customers," Chow said.

Ericsson president Claes Odman said his company now had over 40 percent of 3G contracts around the globe, and had already delivered commercial 3G systems to more than 37 operators in 27 countries.

"This selection underlines Ericsson's dominance as the world's largest supplier of mobile telecom infrastructure," he said.

SingTel said the 3G network will be progressively rolled out based on consumer interests and handset availability, although it pledged to meet a deadline set by Singapore's Infocomm Development Authority (IDA) for it to be fully operational nationwide by the end of 2004.

An initial launch of the network that runs on wideband code division multiple access (W-CDMA) will be ready in the central business district and three industrial areas, including info-tech hub Science Park, by early next year.

With 3G, users can look forward to video streaming and messaging, face-to-face phone conversation and high speed Internet access of up to 384 kilobits per second (kbps), compared with 9.6 kbps on global system for mobile communications (GSM) handphones.

"We have identified four applications -- video streaming, video messaging, video conferencing and mobile gaming -- as the drivers behind market adoption and the success of 3G," Chow said.

He added the new network would be "backward compatible" with SingTel's existing GSM and general packet radio service (GPRS) networks so users can easily switch to conventional networks on dual mode handsets, which will be available by the end of this year.

The three telecoms firms in Singapore, SingTel, Starhub and MobileOne all have licenses to unroll 3G networks in Singapore.

Nokia, the world's biggest handphone maker, has already won a 200 million Singapore dollars contract with MobileOne and has signed a letter of intent with Starhub.

The cost of rolling out the 3G network in Singapore has fallen dramatically from the more than one billion-dollar price estimate floated a few years ago, thanks to rapid technology upgrades.

Singapore is recognised as one of the most high-tech countries in the world with latest government figures showing more than 80 percent of Singaporeans have mobile phones.

The IDA figures for June, show the number of mobile subscribers in June reached 3.34 million or 80.1 percent of the population, compared with 3.32 million in May.

Although penetration rates in Singapore still lag behind the Taiwan and Hong Kong, where it is common to have more than one mobile subscription per person, they are far higher than most Asian countries.

SPACE.WIRE