China issues 4G network licences to China Mobile, Unicom and Telecom

Reuters

* China Mobile, China Unicom, China Telecom awarded 4GTD-LTE licenses

* FDD-LTE licenses for China Unicom, Telecom not yetannounced

* China Mobile receives license to operate fixed-linebroadband services

By Paul Carsten

BEIJING, Dec 4 (Reuters) - China has awarded 4G licences toChina Mobile Ltd, China Unicom Hong Kong Ltd and China Telecom Corp Ltd in a widely expected movethat will benefit industry players from telecom equipment makersto Apple Inc.

The Ministry of Industry and Information Technology hasissued licences for the TD-LTE standard to the country's threecarriers, according to the ministry's website on Wednesday.

The announcement only mentions licenses for the TD-LTEstandard, not the FDD-LTE standard which is more widely adoptedglobally. The licences will mostly benefit China Mobile, whose4G network is heavily based on TD-LTE.

The ministry also awarded China Mobile a license to operatefixed-line broadband services, according to the company.Previously, only China Unicom and China Telecom were able tooffer fixed-line broadband.

China Mobile, the country's largest mobile carrier bysubscribers, has trailed behind its smaller rivals in attractingusers to its home-grown 3G standard due to its poorer networkservice. It also does not have a distribution deal for Apple'siconic iPhone.

China Mobile's 3G subscribers accounted for just 23 percentof its total subscribers as of the end of October, compared with42 and 54 percent for China Unicom and China Telecom,respectively.

China is only expected to license FDD-LTE networks - ChinaUnicom and China Telecom's favoured standard - sometime nextyear.

China Mobile issued a statement on its website acknowledgingthe award of the 4G and fixed-line broadband licenses, addingthat it would "collaborate with the supply chain to make anall-out effort to push forward the construction and operation of4G mobile communications".

China Telecom said it would apply for a FDD-LTE licence "assoon as practicable", according to a statement to the Hong KongExchange.

China Unicom declined to comment.

The rollout of commercial 4G is also expected to benefitequipment makers Huawei Technologies Co and ZTE Corp as well as Chinese Internet firms.

APPLE'S IPHONE

China Mobile, the country's biggest mobile carrier, is theonly one to not offer customers the iPhone as Apple did notsupport its proprietary 3G technology called TD-SCDMA.

Now that China Mobile has obtained a 4G licence based onTD-LTE, which is supported by Apple's latest iPhone models, itpaves the way for a deal between the two giants.

But negotiations have been tricky, in part because ofdisagreements over details like revenue-sharing, analysts say.

The ongoing effort has fuelled Wall Street hopes that a dealwould come soon, offering the iPhone to 759 million potentialbuyers who are China Mobile subscribers.

According to a Tuesday report on Fortune.com, China Mobilehas quietly begun taking pre-orders for iPhones.

China, the world's biggest smartphone market, had 1.2billion mobile users as of the end of October, 62.3 percent ofwhom are on China Mobile.

China Unicom is the second-largest with 22.6 percent oftotal users, while China Telecom has 15.1 percent.

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