Carriers Take Divergent 3G Paths In China
By Carlo Longino, Tue Jun 22 22:45:00 GMT 2004

TheFeature member Amy Gu says two of China's biggest carriers are taking very different approaches to 3G.

She writes: "China Telecom and China Mobile are both giants in China’s market, the former is the biggest fixed telecommunications company in South China, and the latter is the most popular mobile service provider here. Puffed by equipment manufacturers, both of them are considering the possibilities of 3G. It is possible that both will get licenses, though they have really different attitudes (link in Chinese).

China Telecom believes 'the early bird gets the worm,' so they are now preparing to set up 3G networks in the entire Chinese market. The whole project will cost RMB 80 billion (about $10 billion), and the capital, Peking, will be the first city to launch 200 of the 3G base stations by the end of the year. As China Telecom is the newcomer into the mobile market, it is being much more aggressive.

Conversely, China Mobile, the most successful mobile operator in China, seems cautious enough to not rush into 3G. Leaders there look peaceful on 3G matters, not the same as others in Europe, Hong Kong. etc. To avoid the risks, China Mobile is internally discussing the possibility to introduce an EDGE network to upgrade its current GSM network. No matter if the proposal is raised by the manufacturers or China Mobile itself, it is more acceptable to the company, which is famous for its caution in technology investment. Also it is partly because the Chinese market is so large, and the mobile penetration rate is just about 20 percent nationwide.

Anyway, the Ministry of Information Industry is still waiting to release the licenses. Maybe it just wants to see the pre-response from the operators. And the operators also want to do something to draw the eyes of the MII."

It looks like the MII will move soon on issuing the 3G licenses. It's evidently been waiting for the homegrown TD-SCDMA standard to be commercially ready before handing out the licenses, but a senior official there says it will be launched in the market by June 2005. The MII is expected to issue 3G licenses to China Mobile and China Unicom, and possibly to fixed operators China Telecom and China Netcom.