Beijing. December 12. INTERFAX-CHINA – China’s Ministry of Industry and Information Industry (MIIT) will issue 3G licenses to telecom operators by the beginning of 2009, although operators must meet three preconditions before it will do so, the MIIT minister announced at press conference on Dec. 12.
“The MIIT plans to issue a TD-SCDMA license to China Mobile, a CDMA2000 license to China
Telecom and a WCDMA license to China Unicom at the end of the year or the beginning of 2009,” Li Yizhong, minister of MIIT said.
Although Li emphasized that the licenses will be issued soon, he said that the exact date is still to be confirmed.
Li said that operators must meet three preconditions before they will be issued with 3G licenses. First, operators must make their 3G development roadmaps and network plans public and submit them to the government. Second, operators must guarantee that their 3G network construction work will avoid redundancy of network resources and will boost the development of the macro economy. Third, China Mobile’s construction of its TD-SCDMA network must reach a point at which it will be competitive with the 3G networks of the other two operators.
“3G licenses will be issued soon after the three pre-conditions are fulfilled.” Li said.
Li pointed out that the three operators have already prepared technology and capital reserves for investment in their respective 3G services.
“The MIIT estimates that operators will invest a total of RMB 200 billion ($29.22 billion) in 3G services in 2009. This will provide a significant driving force for the economy,” Li said.
Interfax reported recently on concerns that China Unicom’s WCDMA license will be held due to a dip in EU-China relations after the French president and current holder of the rotating EU presidency, Nicolas Sarkozy, met with the Dalai Lama on Dec. 6. European firms are set to receive patent payments as a result of the deployment of the European-developed WCDMA standard by China Unicom.
“The political situation is very sensitive and uncertain at present. Li’s confirmation that China Unicom will receive a WCDMA license is good news. However, the exact date of the issuance of the WCDMA license is very important. Hopefully, the MIIT will not treat China Unicom differently. However, China Unicom is prepared for whatever happens,” a China Unicom insider, who wished to remain anonymous, said.
On Dec. 11, the MIIT announced on its Web site that the three operators had signed a framework agreement on network resource sharing based on the regulation issued by the MIIT and State-owned Assets Supervision Administration Commission (SASAC) on Oct. 6. The framework agreement regulates cooperation, network sharing, joint network construction, investment, ownership, rights of use, maintenance responsibilities and methods for solving disputes.
There is still much speculation as to the precise date when 3G licenses will be issued.
Xi Guohua , vice minister of the MIIT, said at the end of November that 3G licenses will be issued by the end of the year. Industry rumors put the precise date at Dec. 15. Others have revised this to some time in February, 2009.
Interfax commentary: After nearly eight years of talk, 3G in China will soon become a commercial reality. The government’s desire to incubate the homegrown TD-SCDMA 3G standard and its distaste for competing standards have been demonstrated by the headstart granted to China Mobile’s TD-SCDMA construction. This has been confirmed by the support given to the operator by the preconditions attached to the award of the licenses. However, TD-SCDMA has already received poor feedback from commercial trials, giving rise to expectations that 3G in China may prove less a success in its own right and more as a learning experience for 4G services, to which many in the industry are already looking.