Posts Tagged ‘WiFi’

More background about WiFi/WAPI on iPhone in China:

Here is iPhonAsia’s reply to CNET Asia article – iPhone finally coming to China, but who cares?

idannyb says…

Hi Ryan,

wifi-music-store-header1While all signs point to no WiFi on the “official” iPhone for China, there is a chance that Apple will submit a dual WAPI/WiFi model that would meet China’s requirements. Yet I’ll concede that this is a long shot.

Based on purported insider leaks to China’s tech press in March, Apple submitted two models for testing – one with WiFi and one without. Yet based on everything that I’ve read, China’s MIIT has allowed only one model to continue through the testing process – Model A1324. This appears to be a new Apple iPhone developed for the China market. It may come preloaded with several “for China” apps (e.g. Youku, Hanwang’s HWPen, etc) but it will most likely come sans WiFi.

Interfax TMT reported on April 7 that Apple had agreed to provide a majority share of App Store revenue to China Unicom. This leads me to believe that China Unicom has agreed to allow Apple to control delivery of wireless value added services (WVAS) and will allow iPhones to load apps via Apple’s China App Store (vs the app store that China Unicom will soon launch). I would imagine that as part of the negotiation quid-pro-quo, China Unicom will agree to pay a modest per unit subsidy and that the official iPhone will be priced significantly lower than grey market iPhones coming in from Hong Kong.

One item of note is that the iPhone 3GS has now landed in Hong Kong (July 10) and the SIM unlocked version can now be ordered through Apple’s HK Online Store. I’ve heard reports that the SIM unlocked models were sold out in a matter of hours. But not to worry, they’ll (Apple/Hon Hai) soon make more. SIM unlocked models must be shipped to a Hong Kong address. Too bad they need to swim across the channel and then back again.

SIM unlocked iPhone 3GS for 16GB HKD 5,388 ($695 US) and 32GB HKD 6,288 ($811 US) respectively.

In addition to Model A1324, I’m holding out hope (pure speculation) for another new model iPhone later in 2010. This model would be a low-priced “2G only” iPhone and would be available to any China carrier (unlocked). This model would be aimed at prepaid wireless consumers in BRIC nations, particularly in China and India.

Thanks for your article and insights,

~ Dan Butterfield

Jul 13, 2009 05:37


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FWIW … here are my replies to posts on my favorite Apple (AAPL) stock message board – AAPL Sanity

Re: China and the GFW

<< So essentially they’ve likely been negotiating for a model of iPhone with enhanced parental governmental controls. >>

Actually, yes … all “officially approved” WiFi-enabled phones in China must also include China’s home grown WLAN authentication and privacy infrastructure otherwise known as “WAPI

wifi-music-store-headerChina only recently approved the use of WiFi on handsets as long as these phones include WAPI encryption … WAPI (wireless authentication and privacy infrastructure) is still not an ISO/IEC approved standard. The ISO/IEC has previously been rejected WAPI. One reason for rejection was concern over a theorized WAPI “backdoor” that would allow government to monitor users:

This “backdoor” may or may not be true:

“One of the problems with China’s attempt to get WAPI wider acceptance is that they refuse to provide the full specification or its encryption algorithm. I can’t think of a standards body willing to adopt a standard they can’t see.”

“with WAPI’s algorithm still hidden in the shadows, one has to wonder who WAPI’s adoption would make more secure: consumers or the Chinese government?”

… and remains a raging debate amongst “techies” who know more than I … but it’s one reason why there is no clarity as to whether the TBA “official” iPhone in China will come with WiFi … If it does include WiFi … then it is virtually certain that it will be dual WiFi/WAPI … otherwise iPhone would not be approved by MIIT.

The buzz from China is that MIIT is testing an iPhone with WiFi disabled … if true, then Apple has made the decision to forego inclusion of WAPI.  NOTE: These restrictions will apply to ALL smartphone manufacturers who offer WiFi enabled phones in China – Apple, RIM, Palm, Nokia, HTC, et. al.  They will either include WAPI or they MUST disable WiFi.

Background article:  China to Propose WLAN Security Standard for Global Use Again by Owen Fletcher, IDG News Service Tuesday, June 16, 2009 4:00 AM PDT

Re: Hey idannyb… any new china news for Apple? <eom>

All quiet from sites and sources I monitor … My SWAG is that a deal announcement will happen sometime in July with a launch later in the summer. But this is more a gut feel than based on any solid intel. In any case, a deal announcement won’t happen until formal MIIT issuance of iPhone’s network access license (NAL) … which could happen at any time.

I suspect Apple will defer the iPhone in China launch date until the 55 major cities in China are showing good coverage via WCDMA 3G … and that’s progressing.

A few items that might have some relevance …

  • The iPhone 3GS will go sale officially in Hong Kong July 19 (just a rumor – no confirmation). But Apple has already stated it would be avail in HK in “July,” so this is no huge revelation.
  • China Unicom’s WCDMA 3G network build out continues at a brisk pace.
  • Apple/China Unicom official deal announcement could happen in concert with iPhone’s NAL issuance by China’s MIIT.

Word is that MIIT’s iPhone tests have been underway for several months now. So approval (NAL) could theoretically happen at any time. The wildcard is whether Apple is has provided the MIIT a WiFi/WAPI enabled model for tests … or just a model with WiFi disabled (as rumored). China’s authorization of WiFi/WAPI combo was only made public a few weeks ago. Should Apple elect to go this route (go with WiFi/WAPI) it might add time to testing/approval process. I have no reason to believe that Apple will go with WiFi/WAPI. Smart money says that Apple will disable WiFi on the official iPhone in China.

I’ve chatted via Twitter with several beta testers of China Unicom’s WCDMA 3G. They are primarily in Shanghai and Beijing. Since updating to iPhone 3.0 OS on their “unofficial” iPhone 3G (not S), they are reporting improved WCDMA coverage. Major cities in China (55 cities) are now up and running on WCDMA. But there are many secondary cities in China that are still in the early stages of installing WCDMA base stations. … new base stations are going up every day.

When the WCDMA 3G network is completed, I expect the coverage in China to be very good. Much better than in the U.S. Thanks to China’s economic stimulus package, the spend on 3G in China dwarfs what U.S. carriers have spent to set up their own networks. China Unicom’s WCDMA 3G network plans to cover China’s 284 cities with 78,600 base stations. That’s more 3G base stations than all carriers in Western Europe have rolled out in 9 years since 3G wireless standard has been in existence.

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wifi-music-store-headerMarbridge Consulting is carrying a story today about China’s Ministry of Industry and Information Technology (MIIT) approval of a WiFi capable 3G phone by Motorola. This appears to be the first WiFi 3G handset approved by the MIIT. The previous MIIT policy was to not allow WiFi on 3G mobile phones. The approval came about because of Motorola’s inclusion WAPI encryption. WAPI is China’s homegrown standard, an alternative to 802.11 (called WiFi). This appears to be the first mobile handset to integrate both WiFi and WAPI protocols. Read more about China’s morphing WiFi/WAPI polices > HERE

6a00e55225079e883400e553db8faf8834-800wiWill Apple follow Motorola’s approach and include both WiFi and WAPI in a new iPhone for China? iPhonAsia believes that this is a distinct possibility. We should have the answer in a matter of weeks. 

Picture 1EXCERPT: Motorola China’s vice president of sales, Wen Tao, confirmed the company will release a Wi-Fi capable WCDMA handset in China by the end of this month or early next month at the latest. Currently, no Wi-Fi enabled handset has received a mobile network access permit from the Ministry of Industry and Information Technology (MIIT). Wen said the handset, called the A3100, received permission because it supports both Wi-Fi and WAPI wireless networking standards. Read full post > HERE


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iPhonAsia’s response to Barron’s article

picture-13Barron’s posted an article today speculating on the timing for iPhone’s official launch in China. Read more via Barron’s > Apple: When Will China Get The iPhone?

Here (below) is iPhonAsia’s comment to the article. Let’s see if we make it past their spam filter 🙂

china-iphone-300x2081FWIW, here’s my guesswork … The majority of obstacles that Bernstein’s Toni Sacconaghi mentions have already been resolved. He is right that China Unicom will be the initial carrier in China and they will likely get a “3G” exclusive for a year or two. That opens up the opportunity for a low cost unlocked 2G iPhone that would be available through both China Unicom and China Mobile.

I think analysts Shaw Wu and Mike Abramsky may be right in their prognostications that we will not see the rumored Nano iPhone in 2009. However, a low cost iPhone model may be introduced sometime in 2010 to address potential buyers in major pre-paid markets – China, Brazil, India, Indonesia, Russia and Eastern Block countries. While this low cost iPhone has been dubbed a “Nano,” there are plenty of reasons why this phone might turn out to be a full screen model sans 3G and some high end features.



As far as the timing for an iPhone in China announcement … I’m sticking to my prior guess … either May 17 (World Telecom Day) or June 9 (WWDC Keynote) and a launch later in the summer but not before July 1st. 

wifi-music-store-header1The wild card that could upset the timing of an iPhone launch is the outside chance for WiFi (802.11) on a special production run for China.* Apple would no doubt prefer WiFi over China’s homegrown WAPI (doubtful that Apple would build WAPI support into an iPhone for China) and there is still a chance for WiFi approval. Why? Read more here: 

*iPhonAsia believes that the iPhone for China will be a special production run and may come preloaded with several “for China” apps such as mobile search through Baidu.com and an app to support either Tudou or Youku (China YouTube alternatives). We may hear more about these special partnerships with Apple on May 17 or June 9. Read more > HERE

* * *

Comment to Barron’s article by Zee

As a side note: Apple has sought people with Hand Writing Recognition Software/Development expertise. With my Oxford Chinese/English Dictionary I’ve been exploring writing Chinese Characters with a squirrel brush and ink . What I’m getting at: Recently, I watched a Chinese friend Text Message using a Qwerty Mobile Keyboard… I feel the MultiTouch iPhone Screen, the sophisticated OSX’s UI and OS have not yet been explored as to the success the iPhone will have in China over any rival vendors if one is able to use one fingertip for gesturally drawing the Chinese characters. It would be quick to do and adopted rapidly because of the visual vocabulary and orientation Asiatic Character Languages use. Mind you I am speculating. And the iPhone’s superior user experience of just picking it up and away you go, logical intuitiveness, strongly implies once the iPhone is attached to a carrier, it’s adoption in China could boggle the mind. Perhaps any length of time leading up to this deal being cemented, may only mean the Chinese will really get something to own and behold. Because the Chinese own very few personal computers, and the iPhone makes the most sense as a substitute for an affordable, and coveted mobile computing device that will be full featured upon it’s arrival in it’s next manifestation. Perhaps like Google, Apple will have to cede certain controls to the Chinese. Maybe it’s not so much about revenue but more in line with enabling the Chinese to feel they are able to censor or control contra-content. Finally someone mentioned reverse engineering. Well by 2012 China will lead the world in registering Intellectual Property Patents. If China does not want to honor IP Laws then they will find in the future the rest of the world taking their attitude down the road when they’ll have the most to lose. Good business is a two way street.


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China Unicom’s “WO” 3G

Apple’s presumed iPhone carrier partner in China, China Unicom, unveiled its new 3G brand on Tuesday, April 28, 2009. China Unicom’s WCDMA 3G network and services will be marketed under the “WO” brand. The initial WCDMA network trial launch is scheduled on May 17 in 55 major cities across China. The full 3G network rollout is scheduled to be completed by year-end with 283 cities up and running under WCDMA coverage.

China Unicom’s unveiling of WO > WATCH VIDEO

250px-bestbuysh-7117251Five Star Appliance (Best Buy China)

As iPhonAsia reported on April 13, Apple has also reached an agreement with Best Buy owned Five Star Appliance to distribute Apple products throughout China. Apple will set up “stores-within-a-store” ala the Apple mini stores in US Best Buys. iPhone will presumably sell in the Five Star Appliance stores after it is officially launched. Read details on Apple and Five Star Appliance > HERE 

dsc09028There were rumors earlier this year that Foxconn Group’s (Hon Hai Precision is a Foxconn subsidiary) Cybermart would distribute Apple products in China. The Cybermart deal has been “officially denied” by Apple and Foxconn. Stay tuned, as it’s possible that we may hear about additional Apple distribution partnerships in China.

May 17 Announcements – Mid Summer Luanch

iphone-china-unicom-112iPhonAsia believes the China Unicom iPhone deal announcement could be made on May 17 (World Telecom Day) or on June 9 (Apple’s WWDC Keynote). The formal iPhone launch will most likely happen sometime in mid to late summer, but not before July 1.

iPhonAsia believes that the iPhone for China will be a special production run and may come preloaded with several “for China” apps such as mobile search through Baidu.com and an app to support either Tudou or Youku (China YouTube alternatives). We may hear more about these special partnerships with Apple on May 17 or June 9. Read more > HERE

Lou Qinjian - MIIT VM

Lou Qinjian - MIIT VM

MIIT Approval of iPhone and WAPI or WiFi

It should be noted that Ministry of Industry and Information Technology (MIIT) approval of iPhone is a necessary precondition to an official iPhone launch. Last month, MIIT Vice-minister Lou Qinjian confirmed that China Unicom was “engaged in clandestine iPhone in China negotiations with Apple.” He would not disclose any details regarding the negotiations, however he did reveal that:

“The labor letter department is organizing the operator to relate the terminal [mobile handset] manufacturer positively, after the 3G service launches comprehensively [circa May/June ‘09], provides the critical mass to the society 3G terminal product.”   

wifi-music-store-header1The MIIT also recently authorized 3G mobile handsets to include WAPI, China’s homegrown version of WiFi. iPhonAsia is still holding out hope for approval of international WiFi standards (802.11) on 3G mobile phones in China. More on WAPI vs. WiFi > HERE




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Update – May 13, 2009: Wow! MIIT approves a WiFi capable 3G handset. Read details > HERE

Update – April 24, 2009: Beijing. April 24. INTERFAX-CHINA – The Ministry of Industry and Information Technology (MIIT) has allowed mobile phone manufacturers to integrate China’s homegrown WAPI (WLAN Authentication and Privacy Infrastructure) standard into their handsets, a source at a domestic handset manufacturer told Interfax on April 22.

The source, who asked to not be identified, said that MIIT told a number of handset manufacturers on April 17 that both 2G and 3G handsets are now allowed to have integrated WAPI technology to allow users to access wireless broadband. Read details > HERE

MIIT mulling over WiFi policy for 3G smartphones

One egg that may now be in Apple’s Easter basket is an iPhone deal with China Unicom. While Apple and China Unicom may be on the same page, there could be one or two matters to clear up with China’s Ministry of Industry and Information Technology (MIIT). Namely a loosening up of WiFi restrictions and acceptance of iPhone and iPod Touch as approved gaming devices (similar to dispensation for Nintendo DS Lite).  We’ll leave the gaming issue to another article on another day. Today the focus will be on WiFi.

What needs to be resolved? The MIIT has been favoring “indigenously innovated” WiFi technologies (WAPI vs. 802.11i) and has banned WiFi on 3G mobile phones. The logic for the ban appears to be the MIIT’s desire to protect carriers from voice over Internet protocol (VoIP) calling. The MIIT is also afraid that consumers will bypass carriers’ networks by way of WiFi that does not support China’s WAPI (Wireless LAN Authentication and Privacy Infrastructure) encryption protocols. WAPI is rumored to have backdoors that allow for Great Firewall snooping. More on China’s WAPI > HERE

iphone_unlocked_2-thumb1This “no WiFi on 3G phones” policy has created unintended consequences and threatens to slow economic growth in China. Here’s a short list of the problems that the ban poses:

  • The ban has created a huge blackmarket demand for WiFi enabled phones. It has been estimated that 50% of all mobile phone sales in China are through unauthorized channels.
  • The demand for blackmarket handsets has helped to create a thriving “jail-braking” business, where entrepreneurs will unlock handsets and load them with “illegal in China” apps (e.g. Skype and other VoIP and tethering apps).  
  • China loses out on licensing fees for all blackmarket handset sales.
  • Owners of blackmarket phones have little incentive to go “on contract” with carriers.
  • Non-WiFi handset owners have a lower ARPU

wifi-music-store-headerThere is another key issue … With so many blackmarket handsets flooding the market, carriers may have trouble selling their new non-WiFi 3G handsets. China Mobile has several “on the drawing board” customized TD-SCDMA models they would like to promote – Levono OPhone with China Mobile’s proprietary OS, HTC with the Android OS, and forthcoming TD models from Nokia. China Unicom will also be promoting several new WCDMA 3G models including new iPhone 3G models* (yes, possibly plural).

*Guesswork: iPhonAsia believes the iPhone deal with China Unicom will be announced either May 17 or June 9 and will launch mid to late summer. The important caveat is the necessary MIIT approval of the new iPhone models.

3G Smartphones with WiFi enabled will spur greater consumption of wireless value added services (WVAS). This will generate new revenues for carriers and third-party app/game developers. Yet, for now, the WiFi ban stands. While VoIP apps may not be allowed for the foreseeable future in China, the ban on WiFi will only hurt carriers’ ability to enjoy higher average revenue per user (APRU).

There may be some good news on the horizon. It is apparent that carriers and handset manufacturers have been lobbying the MIIT to overturn the WiFi ban. They have likely made the case that smartphones with 3G + WiFi will generate greater average revenue per user (ARPU) verses 3G alone. Moreover, the genie is out of the bottle. There are thousands of open WiFi networks in China’s urban zones, and there is no good way the control the blackmarket in handsets unless MIIT shifts its WiFi policy. For example, there are now some 500,000 iPhone 3G owners in China surfing on EDGE 2.5 G and WiFi. China Telecom and China Unicom can expect the blackmarket to upset their plans to bring more Chinese wireless users “on contract.” China Mobile too has an incentive to add WiFi to select models (e.g. TD HTC) as they can expect TD-SCDMA smartphones to stay on the store shelves if they do not include WiFi.

The best way to undercut the blackmarket is to allow WiFi on 3G smartphones and provide incentives for consumers to purchase authorized handsets and to go “on contract” for cool and fun WVAS (e.g. App Store, music, games, mobile TV, video chat, wave-to-pay, tethering and many pre-loaded apps). The bottom line … there is more money to be made with WiFi than without.

Let’s hope China’s MIIT acts in Chinese consumers’ interests and in China’s economic interests by allowing WiFi on new 3G smartphones in China. 


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Update – April 24, 2009: Beijing. April 24. INTERFAX-CHINA – The Ministry of Industry and Information Technology (MIIT) has allowed mobile phone manufacturers to integrate China’s homegrown WAPI (WLAN Authentication and Privacy Infrastructure) standard into their handsets, a source at a domestic handset manufacturer toldInterfax on April 22.

The source, who asked to not be identified, said that MIIT told a number of handset manufacturers on April 17 that both 2G and 3G handsets are now allowed to have integrated WAPI technology to allow users to access wireless broadband. Read details > HERE

WiFi on iPhone in China? Maybe


Will an official iPhone in China come with WiFi? If the Ministry of Industry and Information Technology (MIIT) bends to the will of consumers and China Unicom, then we may get our wish. But alas, don’t underestimate China’s tendency to make non-economic (political) decisions that stifle progress in the interest of maintaining control (“we’re watching you”) and promoting “ingeniously innovated” technologies. 

Minister of Industry and Information Technology Li Yizhong

Minister of Industry and Information Technology Li Yizhong

Is there a chance for Wifi? Yes, but in the near-term (2009) it’s less than 50/50 odds. I’d place the Vegas line at 70/30 against. But hey, 30% is still a chance. There are many who might say that 30% odds for an iPhone with WiFi is optimistic. But China’s Ministry of Industry and Information Technology (MIIT) gave us reason to be hopeful. On March 18, 2009 Marbridge Consulting reported that:

“A source close to the Ministry of Industry and Information Technology (MIIT) says the ban on Wi-Fi enabled mobile handsets might be lifted shortly, with the condition that such handsets were also compatible with the Chinese-developed WAPI wireless networking standard.”

One important side note: For many years now, China ministry officials told wireless consumers that WiFi would NOT be allowed on mobile phones. The rationale for this prohibition was the fear that consumers might be tempted to illegally load VoIP apps and make calls over the Net (Skype, et. al.). China felt this would undermine carriers’ interests.

What was the result of this “no WiFi for handsets” policy? A flourishing black market in WiFi enabled mobile phones, including iPhone. There is also a major jail breaking business in China. Entrepreneurs will sell you a WiFi Smartphone and load it with a VoIP app that allows you to bypass the carrier’s network. 

The genie is now out of the bottle. China’s MIIT is not blind to this thriving black market in Wifi handsets. Telecom insiders in China have estimated that a full 50% of mobile phones sold in China are traded through these black or grey market channels.  How do you stop this? Make WiFi on mobile handsets legal albeit the handset may have to comply with China’s WAPI.

Let’s hope the MIIT makes the right call and approves WiFi enabled handsets. The consumers will be the winners and new e-commerce opportunities will arise. WiFi will also attract new mobile subscribers and will raise carriers’ average revenues per user (ARPU). That’s called a “win, win, win” – for consumers, for carriers, and for China.

Here’s the full backstory for those who care:

In 2003, the Chinese government released its proprietary security encryption standard for WiFi, known as WAPI (Wireless LAN Authentication and Privacy Infrastructure). China’s ministries then said that any foreign company that wanted to sell Wi-Fi gear in China would have to include WAPI in their products. Naturally, in order to include WAPI in products (e.g. laptops and base stations), foreign manufacturers would have to license the technology though agreements with specially designated Chinese vendors (there were initially 24 such approved vendors).

80211i_logo_deMany nations, including the USA, objected strongly to the WAPI standard, and in 2004 the Chinese temporarily relented and backed off on the mandate. But the Chinese would not give up easily. Chinese engineers and government officials wanted to see their own WAPI standard adopted as the official International Organization for Standardization (ISO) successor to WiFi encryption. The Chinese pushed hard for WAPI, but in 2006 the Geneva based ISO voted in favor of a rival technology – 802.11i. WAPI was supported by just 32 percent of ISO members. In the same 2006 voting session, 802.11i was backed by 89 percent of those who voted. 

What was the key reason for WAPI’s rejection? Concerns over WAPI secrecy, namely the use of an undisclosed algorithm in the WAPI protocol. This set off rumors and charges that WAPI may have “backdoors” that allow China’s Great Firewall (60,000 employees who monitor the Net) to snoop on WiFi users. To this day, China refuses to allow a full inspection of the WAPI standard.


“I have assumed all along, and see no reason to doubt, that the WAPI standard contains backdoor technology that will allow China to monitor any communications sent over ‘secure’ links. Given the propensity for Chinese government monitoring of general Internet activity specifically, and warnings from security firms about purchasing technology designed in China that could contain embedded corporate espionage tools, this isn’t so much speculation as a high probability.”

Still more background:

chinatrade1-1Excerpt from Telecommunications Industry Association (TIA) December 12, 2008 letter to the Executive Secretary, US Trade Policy Staff Committee:

Issue 4: Technical Barrier to Trade – Wireless Authentication and Privacy Infrastructure (WAPI).

Impact: TIA understands that MIIT plans to issue a regulation allowing handset manufacturers to seek type approval for WiFi-enabled handsets. However, TIA also understands that the MIIT regulation would require handset manufactures to use WAPI and allow them to use WPA2. It is unclear why MIIT would require WAPI when an international standard exists for WiFi (WPA2, which is used internationally as the encryption method in IEEE 802.11i).

Recommendation: TIA seeks to understand what the regulatory justification is for requiring WAPI to be used in order for manufacturers to get type approval for WiFi- enabled handsets. Further, TIA would urge USTR to remind the Chinese government of its 2004 JCCT commitment not to mandate WAPI, and would ask that USTR press MIIT to remove WAPI as a condition of getting type approval for WiFi-enabled handsets in China.

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See also the following excerpts from a United States Information Technology Office (USITO) report on WiFi and WAPI (Apple and many other tech/telecom companies are members of USITO)…

USITO Special Report: China’s WiFi-based “WirelessCity” project kicks off

December 26, 2008

Recently the Chinese government has been sending mixed signals with regards to Wi-Fi. The industry regulator, MII has long harbored hostility toward U.S.-owned technology, especially Wi-Fi. For instance, it reiterated last year that mobile phones with Wi-Fi enabled-functions are prohibited to sell in China, with no sign that China will change its policy in the future. On the other hand, Wi-Fi technology is growingly popular within the Chinese IT industry: more domestic computer vendors have begun to adopt Wi-Fi, almost 100% of laptops made by domestic companies such as, Lenovo, Haier or Hasee, exclusively use Wi-Fi technology. Most importantly, governments at local levels, out of MII’s jurisdiction, are deploying Wi-Fi at an unprecedented large scale – as we read from last week’s news reports in China’s technology media.

According to the 1/17/2008 headline story in tech.sina.com.cn, the launching ceremony of the “Shanghai Jiading Wireless City” program, China’s first WirelessCity project, was held in Shanghai on December 28, 2007. Shortly afterwards, the local government signed a number of deals with the vendors for relevant Wi-Fi equipment. This signifies the official kick-off of the “Shanghai Wireless City” project. An official press release stated that CECT-Chinacomm Communication Co. will be responsible for implementing the program, and the first phase of the project will build 200-300 Wi-Fi base stations. Members click here for the full text

Special Report: Extensive Wi-Fi Deployment by Chinese Carriers

On March 10, 2008, official sources from China Telecom, China’s largest fixed-line carrier, stated the company will accelerate its Wi-Fi deployment, and roll out large-scale wireless networks in Southern China’s 21 provinces.

China Telecom’s statement said the deployment of the Wi-Fi network will enhance customer loyalty to China Telecom and boost the competitiveness of its mobile service. The company’s 21 provincial subsidiary carriers will focus on building and optimizing their Wi-Fi networks in 2008, in an effort to secure its earnings amid the sharp revenue decline in the landline businesses.

While the telecom carriers are extending their Wi-Fi deployment, China’s WAPI (Wireless Authentication and Privacy Infrastructure) camp made another round of proposals to top Chinese authorities during the National People’s Congress (NPC) meetings, which are still taking place in Beijing. A representative from the Xi’an Electronics University (Xidian), the initiator and patent holder of WAPI, submitted a proposal to NPC asking for reinforced government measures to promote mandatory WAPI products in government agencies and state-owned enterprises. The proposal said that China’s domestic market is currently dominated by foreign wireless LAN products, and that reliance on them is harmful to national security. The WAPI standard should at least be used in the country’s important industries, such as energy, transportation, finance, aerospace and pharmaceutical sectors. Xinhuanet.com, 3/14/2008

USITO Notes: Chinese telecom carriers prefer Wi-Fi to WAPI, although the WAPI camp keeps lobbying the government and industry to promote their products. Currently, most laptops in China support Wi-Fi; it is very rare to find any laptops with a wireless LAN function supporting WAPI. At the city level, governments are making efforts to improve their communications infrastructure by building Wi-Fi networks, like Shanghai and Beijing.

As covered in recent USITO weekly newsletters, Shanghai Municipal Government has announced plans to establish a citywide wireless broadband network adopting Wi-Fi by 2010. The city will build trial networks in several districts this year and will explore a new business model for the wireless city. On March 5, Shanghai Telecom and the Shanghai Municipal Informatization Commission signed agreements for the construction of the wireless network, which will allow anyone to access broadband at anytime from anywhere in the city. At present, people can access Wi-Fi networks in Jiading District of Shanghai. In Beijing, Wi-Fi-based wireless networks are now available in most Olympic facilities and popular scenic spots. Wi-Fi hotspots are also widespread in the city’s business areas, transportation stations, hotels and restaurants.

However, WAPI still has its advantages, especially considering China’s growing national concern for information security. This issue has oftentimes been raised by the WAPI camp, though strictly speaking it remains a question whether WAPI could sufficiently prove its security feature. For the time being, the security issue has been a significant disadvantage of WLAN compared with traditional landline networks, and in China there was once widespread doubt over Wi-Fi‘s security capability.

No feedback to the Xidian proposal is yet available from the NPC authorities, but Chinese industry experts widely hold the view that the submitted proposal will once again receive no support, just as it failed to do in several submissions in recent years. USITO will continue to track the issue, and interested members should contact us for more details.

MIIT to Allow WiFi Phones?

Last week Chinese technology media widely quoted an MIIT official saying that mobile phones with WiFi functions will soon be allowed to debut on the Chinese mainland as early as late this year“. The quoted official was said to be Xiao Li, duputy chief with the Telecommunications Metrology Center under MIIT.

According to Xiao li, the WiFi-enabled mobile phones will be approved for sale by competent Chinese authorities at the end of this year or the beginning of next year. He estimated that the output of WiFi phones is set to hit 200 million to 300 million units in 2009 in China, half of which will be exported. But Mr. Xiao added that allowing WiFi-enabled phones doesn’t mean allowing Internet phone services such as VoIP, which was regarded as a major threat to the traditional voice-call telecom carriers.

WiFi phones have been restricted for several years in China’s domestic market. All handsets sold in the legal mobile phone channels are banned from carrying built-in WiFi chips although the feature has been widely available in most cell phones across the world. Shanghai Daily , 10/14/2008

USITO Notes: Despite this exciting report, we doubt the whole thing is at rumor base, and are yet to see any positive signs of having wifi phones available in Chinese official channels in the near term. First of all, we saw that Xiao Li is in strict sense not an MIIT official; his lab is a profit-making enterprise affiliated to the MIIT, with primary mandate being profitable (though not officially stated). From his own perspective, he would like to encourage the government loosen the control on WiFi phones, as this would mean better business opportunities. His lab, the Telecommunications Metrology Center, is China’s first agency authorized (in 2005) to conduct WiFi test and certification services. Now China has the second such lab, the Shanghai Tongxin Communications Technology Co., Ltd, authorized on October 13, 2008 to conduct similar certification services following Xiao Li’s lab.

The government repeatedly told the subscribers that WiFi mobile phones can’t be allowed as it would violate carriers’ interests when WiFi is “illegally” used for VoIP services and the like. However, the interests of Chinese mobile phone subscribers are rarely addressed. The scenario helps China’s “black market” grow rampant, as experts believe half (50%) of mobile phones sold in China are traded through illegal channels at the current stage.

Other than the frustrating mobile phone sector, WiFi has been largely adopted in China’s cities. In late 2007 Shanghai government kicked off the “Shanghai Jiading Wireless City” program, China ‘s first Wireless City project. Beijing, the 2008 host cities, began building WiFi spots several years ago and WiFi signals now cover all downtown areas (within three ring road). According to a CCID report, by 2012, WiFi hot spots in China will reach over 38,000 from 10,000 now.


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