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Mar. 21, 2007

China Mobile Inc. is planning to invest $5.2 billion to design and build a large 3G wireless network based on the homegrown TD-SCDMA mobile standard.

The largest wireless operator in China has scored the first 3G license from its local government, which, given its state-sponsored backing, isn’t surprising.

Up until today, the Chinese government had delayed issuing any 3G licenses until the TD-SCDMA technology was ready for deployment.

China hopes to use its locally-developed technology rather than Western WCDMA or CDMA2000 networks.

China Mobile’s parent company has invited networking companies, such as Nokia, Ericsson and other Chinese firms, to bid on the new network, which will be trial-tested in 8 large Chinese cities, according to Chen Haofei, secretary-general of the TD-SCDMA Forum.

China Mobile’s competitors are not allowed to build 3G networks of their own until they are awarded licenses from the Chinese government.

Such an early lead for China Mobile in the 3G segment will help position the company even further ahead of its competitors.

Telecom industry groups in China have quietly criticized the government for moving too slowly with respect to 3G licensing.

Many wireless operators have repeatedly said they wouldn't use the local technology, though they probably won't have a choice unless the Chinese government has a change of heart, which is highly unlikely.

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Source: Wireless Week