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December 24, 2013
The last piece of China's 4G LTE rollout has fallen into place, with China Unicom finally calling a tender.
The operator has reportedly issued a tender for 50,000 LTE base stations -- its first large-scale 4G deployment. This sets the stage for head-to-head 4G services competition by the middle of 2014.
However, China Unicom Ltd.'s first foray into 4G is on a much smaller scale than initial rollouts by China Mobile Ltd. and China Telecom Corp. Ltd. This underlines its intention to sweat its 3G assets.
The three Chinese operators have had an unusually short 3G window. Licences were not issued until January 2009, because the market was forced to wait for the market readiness of TD-SCDMA, the homegrown Chinese version of the 3G standard that was adopted by China Mobile.
Because of the limitations of TD-SCDMA, China Mobile has been first out of the blocks for 4G. It deployed a trial network in 2012 in a dozen cities. In mid-2013, it chose suppliers for a major rollout of across 100 cities.
China Mobile has earmarked 41 billion yuan renminbi ($6.9 billion) for 4G this financial year. Analysts have said that figure could rise to $10 billion next year.
At its recent global partners conference, China Mobile said it expected to have deployed 500,000 base stations in 340 cities by the end of 2014, creating what would be far and away the world's largest 4G network.
When the Ministry for Industry and IT (MIIT) awarded LTE-TDD licences to each of the three operators on Dec. 6, China Mobile was ready to go to market. It is now offering service in 16 cities. (See: China Issues 4G TDD Licences.) But by issuing TDD-only licences, the MIIT forced China Telecom and China Unicom to revise their plans to concentrate on the mainstream FDD version of 4G.
China Telecom's LTE rollout, announced in October, was for 60,000 base stations, of which 70% are said to be FDD and 30% TDD. It has said it plans to use TDD as a complement to the FDD equipment solely in urban areas. (See: Alcatel-Lucent Makes 4G Gains in China.)
China Unicom plans an even lower proportion of TDD -- just 20%. The tender is likely to be completed in the first quarter, so commercial service is unlikely to start before June.
Whereas the 4G rollouts will dominate the capex programs of China Mobile and China Telecom next year, China Unicom is betting on 3.5G and its greater range of devices against the higher speeds of LTE. It is expected to spend just CNY10 billion ($1.65 billion) on 4G in 2014, with the bulk of its investment going toward W-CDMA/HSDPA upgrades.
— Robert Clark, contributing editor, special to Light Reading
Read more about:Asia
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