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China Mobile Communications Corp (CMCC), parent of Hong Kong-listed China Mobile Ltd, is expected to soon invite bids for a new round of network trials on the Chinese standard for third generation (3G) mobile communication, according to industry sources.

 

"CMCC has already contacted equipment manufacturers to build TD-SCDMA networks in five cities," said a source with a TD-SCDMA equipment vendor.

 

The TD-SCDMA standard was in part developed by the Chinese Academy of Telecommunications Technology in an effort to employ home-grown technology.

 

"The bidding process will start after the Spring Festival holiday (February 18) at the earliest," the vendor said.

 

The five cities scheduled to use the new standard are Guangzhou, Shenzhen, Tianjin, Qinhuangdao and Shenyang. All the five networks will be built by CMCC.

 

CMCC is already testing the home-grown TD-SCDMA standard in Xiamen, while fixed-line carrier China Telecom operates trial TD-SCDMA networks in Shanghai and Baoding. No 2 fixed-line telephone operator China Netcom is testing the technology in Qingdao and Beijing.

 

The expansion of trial networks to five more cities underlines a growing possibility that China Mobile may adopt TD-SCDMA to run its future 3G networks.

 

China Mobile, the country's dominant mobile operator, has publicly stated its preference for WCDMA, which is prevalent in Europe. TD-SCDMA is an alternative technology to WCDMA and CDMA 2000, which are popular in Japan and South Korea.

 

Compared to its two rival foreign standards, TD-SCDMA is considered less mature, something the government would like to improve, hoping the strongest domestic operator will use a 3G network based on the Chinese standard to ensure its success.

 

China Mobile and China Telecom are widely regarded as the two candidates to run TD-SCDMA commercial networks.

 

Tao Xiongqiang, vice-president of Potevio, previously known as Putian, a domestic telecom equipment maker, confirmed CMCC could soon expand its TD-SCDMA trial networks to include five more cities.

 

Potevio and Nokia have formed a joint venture to develop and manufacture network equipment based on both the WCDMA and TD-SCDMA standards.

 

Some sources predicted China Mobile could start building the new trial networks in March. CMCC was not available for comment.

 

China Mobile's increasing TD-SCDMA push could bode badly for vendors backing foreign standards, as the firm controls about 70 percent of the country's mobile phone subscription base.

 

Huawei Technologies, the top Chinese telecom equipment maker, could be dealt a heavy blow as the firm has invested more that 4 billion yuan in developing WCDMA technology.

 

Manufacturers and technology vendors have been anticipating a windfall from the development of 3G networks that could mean purchase orders worth tens of billions of US dollars. But now that number might be much smaller than expected.

 

Out of the five new cities selected to build TD-SCDMA networks, three are related to the 2008 Olympics. Besides Beijing, some events will be held in Tianjin, Qinghuangdao, Shenyang, Qingdao, Shanghai and Hong Kong.

 

Some industry observers think that 3G services might be available only in Olympic-related cities, in addition to Guangzhou and Shenzhen, where mobile phone users have greater data demands for advanced telecom service.

 

(China Daily January 31, 2007)