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September 19, 2009

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Dell will sell mobile phones at retail outlets

DELL Inc will sell mobile phones through retail channels in China to penetrate into the world's largest cell phone market, the world's No. 2 personal computer maker said yesterday, without providing a detailed timetable.

Dell's push into the global mobile phone market follows similar moves by Acer, Hewlett-Packard and other computer manufacturers. Dell has linked up with China Mobile in its China foray.

"Dell's long-term strategy is to tap into consumer markets, and for that it's necessary to tap into the mobile phone sector," said Michael Yang, Dell's vice president, who is in charge of the company's China consumer business.

Dell's new handset features an operating system called Ophone that was developed by China Mobile. It supports domestically developed 3G technology TD-SCDMA (time division-synchronous code division multiple access).

Dell is negotiating with China Mobile to sell the model in "multiple channels," Yang said at the opening of Dell's first nationwide "customer experience" store, located in Shanghai's Xujiahui shopping area.

The China market offers great potential for latest-technology phones after the central government awarded 3G licenses in January, providing high-speed networks for more mobile applications, analysts said.

In the first seven months, China's mobile phone users increased 61 percent to 703 million, the most users anywhere in the world, according to the Ministry of Industry and Information Technology.

HP, the world's No. 1 PC firm, Acer, Asus and other PC makers have launched handset products in cooperation with carriers such as China Mobile and AT&T.

"Profit margins in the PC industry are limited," said Sandy Shen, a Shanghai-based analyst at US-based IT consulting firm Gartner Inc. "On the other hand, smart phones, especially 3G phones, generate considerable income."

Dell, which started its PC sales in China via Internet and phone orders, will expand distribution channels here, Yang said.



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