China has successfully developed a mobile phone chip, doing away with a long-standing monopoly by foreign companies over the technology, according to a senior official with the Ministry of Information Industry.

The new 3G (third-generation) standard mobile phone chipset was developed by the Shanghai branch of the Spreadtrum Communications Inc., a leading provider of wireless integrated circuits software solutions.

The development will fundamentally decrease Chinese companies' dependence on foreign intellectual property and significantly lower the amount of intellectual property fees paid to foreign communications firms.

"This means Chinese companies are quite likely to compete in anactive way in the future instead of the passive one in the past," said the official.

To date, China boasts a total of more than 300 million cell phone users, the largest in the world.

In the market, a single chipset is sold US$25 to 50, making up 50 to 70 percent of the cost of the phones. Chinese cellphone makers pay more than US$10 billion to import chipsets.

China's cellphone maker giants like Amoi, Bird, Lenovo and Hisense have already signed agreements with some Chinese chip makers, a step that they will use the so-called "China chip" to produce mobile phones that are truly "made in China."

(Xinhua News Agency August 24, 2004)