Competition between service providers (SP) has intensified since the Chinese government issued the 3G telecommunication licenses for the major SPs. China Mobile (CMCC) and China Telecom, the country's leading 3G operators, will both consider March as a critical period for their respective promotions of product and service.

At the TD-SCDMA Industry Internal Communication Conference initiated by China Mobile on January 16, China Mobile's Vice President Li Yue said his company would open base stations in 28 cities as part of their second phase project, while Dong Xin, the general director of marketing, observed that the company had modified its strategy in accordance with the company's 3G network project plan formulated last December. According to the new plan, CMCC's 3G coverage will reach the 28 target cities in June this year.

In comparison, China Telecom's Vice President Zhang Jiping told the press that the company would launch 3G service in 100 major cities before the end of March and would launch full-scale nationwide 3G services in July.

Major cities in better-developed areas will be the front line of the two companies' first round of battle. China Telecom started the trial of strength by offering 3G service in approximately 81 cities, mainly along the eastern coast, and the choice of 28 provincial capitals and a number of other key cities is the CMCC response.

In the preliminary stage of 3G service, both China Mobile and China Telecom are guaranteeing a "smooth transition" for their customers so far as there will be no need for their customers to change their subscriber identity module (SIM) cards.

Its established customer network is CMCC's greatest advantage, whereas China Telecom aims to highlight its CDMA network connection speed: it promises 3.1Mb/S for downloading and 1.8Mb/S for uploading, a huge increase from the present 153.6 Kb/s. A China Telecom official has gone on record stating that the company aims to be the country's number one in 3G SP. However, this ambition seems sure to meet a counter-challenge from CMCC.

According to its plan, CMCC's TD network will cover all the country's cities by 2011. Says Li Yue: "In three years, CMCC will have the largest 3G network coverage in the world."

Currently, CMCC's smooth transition policy offers no change of SIM card, no change of cell phone number, and no re-registration for its subscribers in the 10 TD covered cities. But doubts and criticism have surfaced in response to the high failure rate, the instability of terminals, and the unreliability of debugging tools, all technical problems that remain problematic.

Li Yue also points out that CMCC is making the most of its experience in 2G network operation so as to roll out the TD/2G integration, allowing TD/2G coexistence and free sharing of resources. He also notes that poor performance from component suppliers is holding back CMCC's overall progress.

CMCC, the country's largest wireless telecommunication operator, currently has 460 million subscribers, among whom 420,000 are 3G users, including 156,000 new customers, according to business data made available by the company. The data also shows 82 percent of 3G users have chosen to upgrade their SIM cards. CMCC plans to invest 58.8 billion yuan (US$8.61 billion) in their TD network, building around 60,000 base stations.

(China.org.cn by Maverick Chen, January 19, 2009)