China Mobile sets USD8.6bn rollout budget for 2009

15 Jan 2009

China Mobile has announced a mobile network investment budget for 2009 of RMB58.8 billion (USD8.6 billion) to expand coverage of its 3G Time Division Synchronous Code Division Multiple Access (TD-SCDMA) services. The company also said it plans to issue subsidies of around RMB10 billion (USD1.4 billion) to TD-SCDMA handset manufacturers to encourage take-up of its 3G services, including videocalling, high speed downloads and streaming TV programmes. According to TeleGeography’s GlobalComms database, the TD-SCDMA network was launched on a pre-commercial basis in ten cities in April 2008, with an estimated 300,000 3G users by end-September 2008 (a tiny fraction of China Mobile’s total 436 million user base at that date). Earlier this month China Mobile was awarded a commercial TD-SCDMA licence, whilst it also met equipment suppliers in preparation for the launch of its third-phase TD-SCDMA network rollout tender in 162 cities. The tender is expected to open on 25 January, with winners to be announced at the end of March. Its RMB30 billion second-phase network tender was carried out in November 2008, and will increase TD-SCDMA coverage to 38 cities by the end of 2009.

The company says it plans to cover a total of 238 cities by building 60,000 base stations, up from approximately 20,000 currently. The Chinese government has set a target of 100 million TD-SCDMA subscribers by the end of 2010. According to a governmental statement issued last month, the country’s three 3G licensees – China Mobile, China Unicom (W-CDMA licence) and China Telecom (CDMA2000-based concession) – are expected to invest USD41 billion in third-generation networks in the next two years, including around USD29 billion in 2009.

China, China Mobile