Corporate China | New competition coming soon in China 4G, broadband
The MIIT could award FDD-LTE 4G licenses to Unicom and China Telecom by July, forcing China Mobile to scale back its aggressive 4G subscriber targets for this year
Practically speaking, China Mobile is currently the only one of China's three telcos that can offer 4G service, after receiving a license from the Ministry of Industry and Information Technology (MIIT) late last year. Unicom and China Telecom also received 4G licenses at that time; but for technical reasons those licenses were largely hollow and the pair have been waiting impatiently to get useful licenses to build networks based on the FDD-LTE standard that is compatible with their current 2G and 3G networks.
Now media are reporting that China Telecom is expecting to receive its FDD-LTE license as soon as next month, and is preparing eight handsets for its 4G service. If the reports are correct, then presumably Unicom will receive an FDD-LTE license at the same time. The MIIT is notorious for its delays, and I wouldn't be surprised if the licenses don't actually come out until June or even July. But the timing seems about right, since an award of FDD-LTE licenses in that time frame would give China Mobile a half-year head start in 4G.
The regulator gave that head start because China Mobile is using a newer, more problematic homegrown standard in its 4G network. But this new award of FDD-LTE licenses means that Unicom and China Telecom could launch their commercial 4G service as early as the third quarter, potentially denting China Mobile's ambitious targets for new 4G subscribers this year.