Beijing has confirmed speculation that it will issue three licences for the country's third-generation mobile service, which analysts expect to be granted by the end of the year after the completion of the industry restructuring. Without giving a timetable, the Ministry of Industry and Information, the National Development and Reform Commission and the Ministry of Finance released a joint statement at the weekend saying the six telecommunications operators would be merged into three. The government would issue the 3G licences after the mergers to enable all three operators - China Mobile, China Unicom and China Telecom - to run fixed-line and mobile services, the statement said. 'The restructuring is scheduled to be completed no later than this year,' a telecommunications analyst said, adding that the licences could be awarded in the fourth quarter. China Telecom chairman Wang Xiaochu said in March that the company might need three to four months to complete the acquisition, and a further three months to launch the service once the government announced the restructuring plan. Analysts said the 3G licences would probably be based on three different technologies - the homegrown TD-SCDMA, European-developed WCDMA and the United States-developed CDMA 2000. China Mobile Communications Corp, which is now operating the homegrown standard in eight cities including Beijing and Shanghai, is expected to be awarded the TD-SCDMA licence. China Mobile Communications has invested 14.2 billion yuan (HK$15.96 billion) in developing the TD-SCDMA network. The company launched commercial trials last month but they were not well-received due to the poor service quality. 'China Mobile is rumoured to have asked for a WCDMA licence for the upgrade of its GSM network, which should be the contingency plan if its TD-SCDMA network still lacks improvement,' said Fang Meiqin, the principal analyst at telecommunications research house BDA China. Ms Fang said that suppliers and vendors of TD-SCDMA equipment had blamed China Mobile's poor support and lack of promotion for the tough business environment in the sector. Under the plan, the new China Telecom will be the combination of the current fixed-line company and Unicom's CDMA network. It will also take up the basic telecommunications services of China Satcom, a satellite communications operator. The enlarged firm was expected to get a CDMA 2000 licence, analysts said. UBS was the financial adviser for China Telecom, sources said. 'The terms of the acquisition may be out in the next two weeks,' the sources said, adding that both parties had started talks. Market watchers valued Unicom's 43 million CDMA subscribers at 30 billion yuan to 43.5 billion yuan. The CDMA network, held by Unicom's parent, is valued at 50 billion yuan to 70 billion yuan. Unicom's GSM network will merge with fixed-line operator China Netcom and analysts said it could be awarded a WCDMA licence. China Mobile will take over China Tietong, which owns the nationwide railway-based telecommunications network, Xinhua reported on Friday. Shares in China Telecom, China Unicom and China Netcom Group Corp, the listed units of the groups, would be suspended from trading until further announcements on the potential transactions regarding the restructuring. Analysts said the merger of Unicom and Netcom could be the most complicated as it involved a share-swap arrangement. Credit Suisse estimated Unicom's assets would account for 65 per cent of the merged entity and Netcom 35 per cent. Netcom yesterday announced Zhang Chunjiang had resigned as chairman and executive director effective last Friday. Mr Zhang was appointed party secretary and deputy general manager of China Mobile Communications Corp.