Beijing, January 20, 2003 - Datang Mobile Communications Equipment Co., Ltd. (Datang Mobile), Royal Philips Electronics and Samsung Electronics today announced the formation of a joint venture company, named T3G. T3G will design and license core TD-SCDMA chipsets and reference designs for mobile terminals and end-user equipment. The company aims to provide a complete solution (reference design, hardware and software) for handset manufacturers and cellular phone design houses in order to speed up the production of the first commercial TD-SCDMA handsets, likely to be available in 2004.

The availability of the T3G reference design will speed up the development of cost-effective dual mode TD-SCDMA/GSM handsets in China, a factor which will ease operators' migration from second to third generation networks. With limited capital outlay operators will be able to immediately increase capacity, enabling them to improve profitability by building subscriber numbers for 2.5G and 3G services simultaneously. Operators will therefore be in a position to roll out reliable mobile broadband services in line with demand.

T3G plans to produce core chipsets and reference designs for TD-SCDMA/GSM (GPRS) dual-mode mobile handsets that will be brought to market by Samsung and other handset manufacturers. The technology is designed to reduce the current bottlenecks in the development of 3G handsets by providing benefits including reduced power consumption and improved standby time. The collaboration combines Datang's TD-SCDMA expertise, Philips' cutting-edge semiconductor design and process capability and Samsung's leadership in mobile handset creation. Each partner has invested considerable resources, including capital, technology, personnel and marketing.

"We have already successfully developed a TD-SDCMA test terminal and feel that the time is right to accelerate the availability of the first commercial products." commented Mr. Zhou Huan, President of Datang Mobile. "We strongly believe that our collaboration with Philips and Samsung, both at the forefront of their respective fields, will accelerate the commercialization of TD-SCDMA and thus contribute to the development of the TD-SCDMA industry."

"This venture builds on Philips' longstanding commitment to investing both technology and capital in China and its strategy of delivering complete solutions for operators and handset manufacturers." commented Thierry Laurent, executive vice president business unit mobile communications at Philips Semiconductors. "Our involvement in T3G will enable us to deliver advanced chipsets compatible with most of the world's 3G networks."

Mr. Shin, Jong Kyun, Vice President of Mobile Communication Division at Samsung added: "Samsung's participation as a founding Partner clearly shows Samsung's commitment and support to the Chinese Mobile Industry. China is the world's largest market for mobile phones but there is still considerable untapped demand. Through T3G's solution, Samsung plans to introduce commercial handsets in 2004 that will help the TD-SCDMA reach its full potential. By accelerating the time to market for TD-SCDMA handsets we hope to help the standard reach a critical mass of subscribers in record time"

Talking about the future development and business model of T3G, Johan Pross, CEO of T3G commented that "T3G is an autonomous company and the three venture partners will allow the company to expand in the market independently. T3G will also be in a position to form broad strategic alliances and provide open access to the technology."

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