3G Plans Announced In China: What Does It Mean For Global Telecom?
As the world’s largest market, there has been a huge interset by the whole world in China’s 3G plans. Finally there is official word on China’s 3G roll out. At TelecomPk.net we have been wondering about 3G in Pakistan for some time and it is interesting to learn from the Chinese 3G roll out. For one the Chinese telecom has been shrouded in mystery for years. Now restructuring plans have been announced which will cause many ripples in the Chinese industry and will have implications for global telecom industry.
We share two perspectives here. One from WSJ story Long-Awaited Plan Feeds Competition, Fuels Wireless Revamp and another from blogger Brough Turner China’s 3G license delay is a smoke screen. Brough who has travelled to China frequently, says that 3G licenses are a formality and 3G is happening in China without licenses. Brough believes that “As more and better TD-SCDMA handsets get deployed, we should see some really interesting innovation coming out of China — innovation that will be applicable to any 3G technology, anywhere in the world.”
Some excerpts from the news story:
After the restructuring, the statement said, the government will issue licenses for advanced, “third-generation,” wireless services that enable high-speed functions such as video downloads. China is one of the last major telecommunications markets to adopt such 3G technology. Global telecom-equipment providers such as Telefon AB L.M. Ericsson, Alcatel-Lucent SA, and Huawei Technologies Co. have been waiting years for China to begin building 3G networks.
The new structure has been determined entirely by the government, which owns all of their parent companies, without any say from outside shareholders. While Saturday’s statement said the government only “encouraged” companies to follow the plan, it is clear that companies have begun to implement it.
China Mobile Communications Corp., parent of China Mobile, will take over China Tietong Telecommunications Corp., the smallest of three fixed-line operators. China Mobile stock is down for now though it has been turbulent this year.
Questions remain about how the industry changes will play out — not least about how various 3G technologies will be deployed. Industry executives and analysts expect each of the three new carriers to use a different type of 3G technology, including two international standards and one that was developed in China.
The government has been especially eager to promote the domestic 3G standard, called TD-SCDMA, as part of a broader push to help wean China off higher-cost foreign technologies. TD-SCDMA has undergone the widest testing in China. But some analysts have said problems with the technology — which hasn’t been used outside China — have caused the government to delay the rollout of commercial 3G services.
Saturday’s statement alluded to the importance placed on TD-SCDMA, saying one of the industry restructuring’s main goals is to foster “indigenous innovation.”
It remains unclear how the other two 3G technologies, WCDMA and CDMA2000, will be employed — a question for foreign companies that stand to earn more from their use. China Mobile, the strongest financially of existing operators, has been handling the bulk of the TD-SCDMA tests, and is expected to keep using the technology as licenses for commercial service are issued.
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