China could "very
soon" award domestic telecom operators licences to build 3G (third generation)
mobile phone networks, the country's top telecom official said yesterday.
"I cannot provide a specific timetable, but it could happen very soon," Wang
Xudong, minister of information industry, told reporters at the ITU Telecom
World 2006 being held in Hong Kong.
Wang reiterated a commitment to enable operators to offer 3G services during
the 2008 Olympic Games in Beijing, saying it is "well-founded and feasible."
3G services enable video calls,
faster data downloading speed and mobile Internet access.
Wang said operators would be given enough time to deploy 3G networks. "The
build-out of networks and the following trial operations could take some time."
Industry observers estimate that setting up networks and trial operations
could take at least one year before operators can formally roll out services to
consumers.
As a result, some believe licences could be handed out in the first quarter
next year; and China Netcom (Hong Kong) CEO Zuo Xunsheng said at the expo that
it could be as early as February.
The acceleration of the 3G licensing process could be a shot in the arm for
major telecoms companies, especially equipment and
handset makers, which have invested heavily in 3G-related
research and development.
The building of the 3G networks could unleash purchase orders worth tens of
billions of dollars but Wang suggested the windfall might be smaller than many
expect.
"It might not be feasible (for operators) to build national 3G networks
immediately," he said. Some analysts expect regulators to allow operators to
first build networks in select cities such as Beijing and Shanghai.
Wang would not specify how many 3G licences would be handed out. There are
four major telecoms operators in the country and analysts believe four licences
could result in excessive competition while fewer than three could curb
competition.
"Government bodies are studying how many licences, three or four, are needed
(to be awarded)," said Wang.
An industry restructuring has been looming in China's telecom sector, which
might see the government consolidate the top four operators into three while
awarding 3G licences.
