Chinese Mobile telcom market powers ahead

China Mobile (Hong Kong) Ltd. (HK: 0941) With a base of around 250 million subscribers (they cover 98% of the population) in China had 42 million net subscriber additions during 2005, with the average pace of net monthly additions rising to 3.9 million during the last quarter.Non-voice revenue continued to grow and accounted for more than 20% of the carrier‘s total revenues - they delivered more than 250 bln short messaging messages (SMS) in 2005.It is expected users will be 500MN in China by the end of
the decade.

Worldwide GSM subscribers total 1.56Billion and grows at 1 Mn per day.

In addition wireless music services such as music download, CRBT (color ring back tone), IVR (interactive voice response) are growing quickly in China, already creating more business value than the traditional music industry.

CM is Asia's most valuable telecom company, in which Vodafone has a 3.27 percent stake.

Mobile industry watchers expects China's entry into third generation mobile services to help drive down prices of 3G handsets and give the service a much-needed boost.China will award its 3G licenses in the first half of this year (Ministry of Information Industry (MII) is responsible), a move anticipated to unleash up to US$12 billion in spending as the country sets up the high-speed mobile data networks in time for the 2008 Olympics in Beijing.

Most of the world's major telecom equipment makers are hoping to get a piece of the action, and have also entered into various partnerships to support China's own 3G technology TD-SCDMA - which is claimed to have superior performance to WCDMA for a varirty of technical reasons - try Wikipedia TD-CDMA. Network firms ZTE Corp. and Huawei Technologies are the biggest Chinese players in the global market.

Major investors in TD-SCDMA include European firms Siemens and Nokia, while others who have formed alliances to support the technology include Motorola, Ericsson, Nortel Networks and Lucent Technologies.China Telecom Corp (HK: 0728)or China Netcom Group (HK: 0906)will get TD-SCDMA licenses.

On January 20, 2006, MII formally announced that TD-SCDMA is the country's standard of 3G mobile telecommunication. On February 15th, 2006, a timeline for deployment of the network in China was announced, stating pre-commercial trials would take place starting after completion of a number of test networks in select cities. These trials are expected to run from March to June, 2006. TD-SCDMA enabled handsets are also set to start testing around the same time, and are expected to be available in Q2 or Q3 of 2006. A TD-SCDMA forum provides up to the minute technical information and news.

Chinese (Shanghai based) fabless Spreadtrum announced the industry first TS - SCDMA baseband chips at the 3GSM World Congress, Barcelona, Spain, on Feb 15th, 2006, made interestingly enough by Taiwan based Taiwan Semi Conductor Manufacturing TSCM. At the same Forum Vodafone it has signed a global supply deal with Huawei Technologies for exclusive Vodafone-branded third-generation handsets which will be expected to drive down the costs of 3G handsets worldwide.

The deal represents Huawei‘s first significant handset deal in Europe ... and will not be the last.

WCDMA is a natural technology upgrade for the GSM standard, which is based on technology developed in Europe and widely used in China and is the natural route for China Mobile.

W-CDMA trial networks have proliferated in leading Chinese cities with equipment provided free by foreign manufacturers such as Nokia, Ericsson and Lucent Technologies as well as domestic producers such as ZTE and Huawei Technologies, in an attempt to secure future business although MII have tried to halt such trials.

China Unicom,(SHA: 600050) the second mobile operator with 25% of the market is rumoured to be split up. It was previously headed by Wang Jianzhou said now head of China Mobile.



Recent blogs on same topic here

STOP PRESS

Mobile weblog today reports China's Ministry of Information claiming almost 400 million mobile phone subscribers in China, a rise of almsot 59 million over last year, indicating more than 3 million new people subscribed every month.

Pacific Epoch has a report that China Mobile announced on February 20 that it recorded 4.07 million new users January and 251 million users end of January. Only 119,000 of the new users are contract subscribers. (Shares 36.95 closed up 0.35 = 1%)

China Unicom also announced on Monday that it registered 1.31 million new users in January and hit 129 million users by end of January. Of these 96.06 million were GSM users and 33.03 million CDMA users at the end of January, an increase of 990,000 and 316,000 new users from December, respectively.

Prepaid users accounted for less than half of China Unicom's new GSM users while the majority of new CDMA users were contract subscribers.

So CM and CU have 366 Mn subscribers between them.