China Mobile Steps Up 4G Drive 中移动4G网络建设提速年底或推商用试点

By newsdoug on February 29, 2012

China Mobile accelerates 4G plans There’s quite a bit of telecoms news coming out this week from the city of Barcelona in Spain, where China’s telcos and equipment makers are all showing off their latest wares at the world’s biggest annual telecoms show. Most of it looks like the usual display of new gizmos and gadgets, but the item that caught my eye was a relatively detailed update on China Mobile’s (HKEx: 941; NYSE: CHL) 4G plans, which indicate that both the company and, perhaps more importantly also the government, are moving aggressively forward to build a commercial network based on a homegrown Chinese standard called TD-LTE. Equally significant is who was discussing the plans, as the comments came from a relatively youthful Li Yue, a fast rising star who recently took over as president of China Mobile’s state-run parent, rather than the company’s longtime aging Chairman Wang Jianzhou, who is getting set to retire. Li said China Mobile will move ahead with plans to expand its large-scale trials of TD-LTE to 9 cities later this year, adding Qingdao, Tianjin and most importantly Beijing, to its current trails in 6 major cities that began last year. (English article) He went on to say that the fast-growing trial network could even be ready for commercial service in the cities of Shenzhen and Hangzhou by the end of this year. Li said the handful of telcos building commercial TD-LTE networks outside China, most notably Softbank (Tokyo: 9984) in Japan and Bharti Airtel (Mumbai: BHARTI) in India, are slowing down their plans until China Mobile can bring more momentum to the standard by working with networking equipment and handset makers to develop more products and clean up technological problems. Those remarks imply that not only China Mobile, but also the government, are working hard to speed up deployment of a full-scale commercial TD-LTE network in China, as Beijing is especially keen to see a China-developed standard compete globally alongside other standards developed in the US and Europe. In one other major development in that direction, Li disclosed that Qualcomm (Nasdaq: QCOM), one of the world’s biggest chipmakers for both cellphones and telecoms equipment, has agreed to develop chips based on the standard, providing more momentum for its development. On top of all those developments, I also like the fact that Li is now speaking for the company on this issue, as he represents a younger, more aggressive generation of new leadership that China Mobile needs to breathe life back into its stagnating top and bottom lines. All these latest signs say that despite some recent delays, China Mobile’s 4G plans are moving ahead at a fast and steady pace, helped by important government support, with some first-stage commercial service potentially starting to roll out in a few cities as soon as the end of this year.

Bottom line: New comments from a top China Mobile executive indicate its 4G plans are accelerating with government support, with limited commercial service possible as soon as year end.

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