CES: U.S. Commerce secretary slaps China for 3G stance

Gutierrez says it should accept common standards to encourage innovation

By Elizabeth Montalbano

January 10, 2007 12:00 PM ET

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IDG News Service - LAS VEGAS -- U.S. Commerce Secretary Carlos M. Gutierrez yesterday criticized China for delaying the creation of a third-generation (3G) wireless network in that country, saying it is thwarting global technology innovation by not embracing standards.

2007 International CES: January 8-11, Las Vegas

Speaking at the International Consumer Electronics Show (CES) here, Gutierrez said companies around the world must support common standards to promote a worldwide environment for technology innovation, and not have their own "pockets of standards." He used China, where the government continues to hold out on granting licenses to build 3G networks, as an example of a country that is not supporting common standards.

"When a government uses its heavy hand to decide what is best for its citizens, it warps the marketplace," Gutierrez said. "We look with great concern when any country obstructs or hinders competition."

China has delayed plans to build a 3G network for several years, he said. Many believe it is because the government wants to promote its own homegrown 3G standard, called TD-SCDMA (Time Division Synchronous Code Division Multiple Access), instead of embracing a version of Code Division Multiple Access (CDMA), which other countries have based 3G networks on.

To do its part to encourage competition in the technology industry, the U.S. has to revise current legislation that governs the technology industry and remain as hands-off as possible to create an atmosphere where the industry can continue to innovate and flourish, he said.

Gutierrez noted that much of the U.S. legislation around the Internet and technology is outdated and needs to be revised to keep up with the current trends of technology convergence.

"We in government need to recognize the need to remove legacy legislative barriers to innovation," he said. "Much of our legislation was put in place many years ago, in the late '90s, which seems like decades ago.... We believe that technology neutrality that rewards innovation and takes the government out of decisions is the right way forward."

Gutierrez said the U.S. will continue to encourage other countries to allow the technology industry to create its own market.

"On a worldwide basis, we need to allow market forces to take their course," he said. "We believe governments should not be allowed to decide on business models. Consumers should pick winners and losers, and innovation will be the drivers of what consumers use."

Reprinted with permission from

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