St. Petersburg Times
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Push made for U.S. technology

By MARY JACOBY, Times Staff Writer
© St. Petersburg Times
published March 28, 2003

WASHINGTON -- In an early skirmish over the expected spoils of war, a California congressman is pressing the Defense Department to use American technology to build a new cell phone network in Iraq.

Republican Rep. Darrell Issa introduced a bill Thursday requiring the United States to award cell phone network contracts to companies that employ a wireless technology called CDMA, which is used in the United States, Latin American and Asia.

Issa said he acted after hearing that Defense prefers to install a European-based technology called GSM in postwar Iraq.

GSM, which stands for "groupe speciale mobile," is a wireless standard developed by the French and a consortium of European companies. It is used in Europe, the Middle East and Africa.

The American standard is called "code devision multiple access" and was developed by the California firm Qualcomm. The technology is not compatible with GSM, which means Iraqis couldn't use their cell phones in neighboring countries if CDMA were deployed.

But Issa, whose district lies between Los Angeles and San Diego, said American taxpayers should not underwrite technology that will benefit others.

"If we build a system based on European technology, the Europeans will receive the royalties, not U.S. patent holders. From an investment standpoint, that's a bad decision," Issa said in a statement.

His bill is more symbolic than substantive at this point, an indication of the huge economic stakes in postwar Iraq.

Russia, France and Germany -- U.N. Security Council members who opposed the United States and Britain's plans to topple Iraqi President Saddam Hussein -- have longstanding business ties with Iraq.

Officials of those countries, already angry over the war, have expressed concerns that the Bush administration will try to muscle them out of reconstruction efforts.

The French telecommunications company Alcatel already has a start in Iraq. It built a limited GSM network for the Iraqi leadership, Issa said, citing a report by World Markets Research Centre.

But in Congress, feelings against the balky U.S. ally are running high. House cafeterias recently rewrote menus to change French fries to "freedom fries" and French toast to "freedom toast."

Issa said the Defense Department and the U.S. Agency for International Development, the civilian agency in charge of reconstruction efforts in Iraq, plan to build a cell phone network after the war for the immediate use of American officials.

After being operated by the United States for some period of time, the network would be privatized, Issa said. And the beneficiaries would primarily be European companies that sell handsets and infrastructure for the GSM standard, he said.

Ellen Yount, a spokesman for the development agency, said officials had not yet sought bids for telecommunications projects in postwar Iraq and that speculation about their plans is premature.

But a spokeswoman for Issa said the congressman's office has heard that some $750-million in U.S. contracts are to be awarded to build Iraq's cell phone network.

Qualcomm, which is not in Issa's district, makes cell phone handsets for the CDMA standard. Lucent Technologies of New Jersey and Nortel Networks of Canada are the largest manufacturers of CDMA infrastructure.

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