China Awards 3G Licenses

China's Ministry of Industry and Information Technology (MIIT) handed out 3G licenses to China Mobile Ltd. (NYSE: CHL), China Telecom Corp. Ltd. (NYSE: CHA), and China Unicom Ltd. (NYSE: CHU) Wednesday.

As expected, China Mobile is to build a TD-SCDMA network, China Telecom a CDMA 2000 network, and China Unicom a WCDMA network. The operators are expected to spend tens of billions of dollars on building their new networks during the next few years. (See China Gets 3G Green Light, China's 3G Move to Trigger Spending, and China to Get 3G – At Last!)

China Telecom issued a statement saying that the "issue of 3G mobile licence [sic] will enhance the economic growth and the competitive landscape of the telecommunications market... The Company will strictly adhere to the relevant regulatory policies, and make comprehensive planning and dedicated preparation for the timely launch of the 3G mobile business, fully leveraging its existing communication network resources. The Company will endeavor to provide more premium services and better satisfy the customers’ ever-increasing diverse needs for integrated information service."

Of the three carriers, China Mobile has the largest installed base of mobile customers, with 450.2 million GSM customers at the end of November 2008, up 6.9 million from a month earlier.

China Telecom, which swallowed China Unicom's CDMA business as part of last year's restructuring of the country's service provider sector, had nearly 28 million CDMA subscribers at the end of November, down more than 400,000 from the end of October.

The carrier is stronger in fixed line services, as it has 210 million fixed access lines (though that number is decreasing by more than 1 million per month), including 43.6 million broadband lines (increasing by about 700,000 per month).

China Unicom had nearly 133 million GSM customers at the end of November (up nearly 1 million during the month), as well as 105 million fixed access lines (down 1.5 million from the end of October).

Unicom, which merged its GSM operations with the fixed assets of China Netcom as part of last year's telecom industry restructuring process, has 25.4 million broadband customers, an increase of 234,000 from the end of October.

— Ray Le Maistre, International News Editor, Light Reading

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