Source: LiveMint.com, Aug 19, 2013
Singapore/New Delhi: The plans of Indian mobile phone service providers to roll-out fourth-generation (4G) mobile networks received an unexpected boost after the world’s largest wireless operator China Mobile Ltd agreed to buy equipment worth more than $7 billion for a network based on a new technology standard, boosting its popularity, and potentially increasing the availability of phones and network equipment based on the standard and lowering their costs.
Indian telecom companies, including Bharti Airtel Ltd and Reliance Industries Ltd, the only companies to have pan-India bandwidth to offer high-speed 4G data services, are struggling to roll-out high-speed mobile networks because of high costs of building 4G networks and few handsets that support the standard. They were awarded air waves to offer 4G services on the TD-LTE 4G (time division–long term evolution) standard, the one that is now being supported by China Mobile.
Most companies in Europe and the US have, however, adopted a rival 4G technology standard. This had prompted leading network equipment vendors such as Ericsson, Nokia Siemens and handset makers such as Samsung and Apple to develop equipment and phones based on the LTE-FDD (frequency division–long term evolution) standard.
On 15 August, China Mobile chief executive Li Yue told reporters in Hong Kong that more than 100 smartphones were being developed for its upcoming TD-LTE fourth-generation network. Besides, some media outlets have reported that China Mobile has been in talks with Apple for a 4G handset on its upcoming TD-LTE network. Li said that talks with the iPhone maker were going on, without disclosing details.
The $7 billion China Mobile network contract is for the first phase of roll-out and will be followed by more such orders, a move that is set to bring down costs of devices and equipment based on this technology, which is also being adopted by Japan’s SoftBank Mobile Corp.
A Bharti Airtel executive had earlier said the company’s 4G expansion plans would largely be related to the development of the ecosystem and added that any move by China Mobile could drive down network costs. The executive, who declined to be named, also pointed out that Bharti was a founding member of the China-Mobile-led Global TD-LTE Initiative (GTI), whose members include Vodafone, Clearwire in the US and Japan’s Softbank.
A top executive with the Indian unit of a global telecom vendor said that vendors who bag the China Mobile order could potentially walk away with a significant portion of India’s 4G market. Chinese vendors Huawei and ZTE had been attempting to leverage their success in supplying close to 45% of the TD-LTE test network that was built by China Mobile to bag deals in India, said the executive, declining to be named.
There’s still a long way to go before the TD-LTE standard can reach critical mass, some experts caution.
“The development is definitely a significant one and one that will cause a great boost to the India TD-LTE ecosystem. But there’s still a long way to go, especially on the devices side,” said a senior executive with a major mobile chipset maker, on the condition of anonymity.
Qualcomm’s success with its latest chips that work on both technology platforms is also set to pave the way for major handset makers, including Apple, to launch products that run on the TD-LTE technology without having to redesign their handsets significantly. Samsung, too, had recently introduced a variant of its popular Galaxy-2 model on the TD-LTE platform.
Earlier this year, China Mobile had unveiled four smartphones from vendors such as Huawei, ZTE, HTC and LG that run on both the 4G technology standards. These along with seven other models are slated to be commercially available by the year end. About 200 devices have been announced in the TD-LTE band, but still accounts for a small segment of the 4G ecosystem as close to 1,000 devices have been announced on the more popular platform, according to the Global Mobile Suppliers Association.
The China Mobile development will also result in Indian telcos dropping their plans to delay 4G deployments until airwaves on the 700 MHz are made available by the government in 2015, according to analysts.