ZTE Tops 3G Tender

11:45 AM -- ZTE Corp. (Shenzhen: 000063; Hong Kong: 0763) is the biggest winner of China Mobile Ltd. (NYSE: CHL)'s third round TD-SCDMA 3G tender, winning 34 percent of the total contract, according to this China Tech News report.

China's vendors again dominated the contract awards, taking a total of 72 percent of the tender, with Huawei Technologies Co. Ltd. getting 22 percent and Datang Telecom Technology and Industry Group securing 16 percent.

This is more bad news for Datang, which was at the forefront of TD-SCDMA's initial development but which has seen its share of China Mobile's business drop dramatically: It previously landed a 40 percent chunk of the the carrier's second TD-SCDMA tender, according to data from Pyramid Research , so its share of the spoils has dropped by 24 percentage points.

Such a dramatic decline gives further credence to suggestions that Datang's equipment is not designed for a seamless upgrade to TD-LTE, something that is reportedly costing the vendor significant business with China Mobile. (See China Mobile Swaps Out Datang 3G Kit.)

Datang's loss has been ZTE and Huawei's gain, though: ZTE increased its share from 25 percent in the second round to 34 percent, while Huawei's share rose from 16 percent to 22 percent.

The decline in share may hit Datang even harder if this earlier Interfax China report, which claims the third round tender was expanded from 260,000 transceivers to 1 million, is accurate.

— Catherine Haslam, Asia Editor, Light Reading

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