Operator to Begin Public Testing of TD-SCDMA Handsets

Communications World Weekly, 1/02/08

According to an industry insider, TD-SCDMA handsets are soon to be released for public testing. Participants will have to sign an agreement with China Mobile (NYSE: CHL; 0941.HK) to submit feedback every two weeks, while China Mobile will provide prompt and comprehensive customer service, with a customer representative assigned to each participant. There will also be a designated maintenance point.

TD-SCDMA handsets can currently provide stable 3G services including telephony, video calling, Internet browsing, VOD and mobile TV. Stability and power usage are approaching levels suitable for commercial use. Q1 2008 will see the release of HSDPA handsets.

According to the source, domestic firms are to win over 50% of China Mobile's TD-SCDMA handset orders, with handsets including smart phones and standard devices, ranging in cost from RMB 2,000 to RMB 3,000.

If TD-SCDMA is officially launched, domestic handset production capacity should be able to meet demand. ZTE (0763.HK; 000063.SZ) alone can produce 50,000 TD-SCDMA/GSM dual-mode phones per month.

The source also said that TD-SCDMA will soon go into commercial use, but the issuing of 3G licenses will not be accelerated - as there is no direct link between the two.

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