Happy New Year!! In the beginning of a year, many organizations will give their predictions for the coming year.   I seldom predict the future.  But, I think one thing that is rather certain in 2011: China Mobile is losing its influence .

Many people already know the reason.  It is because it was grant the worst 3G licenses – TD-SCDMA.  The home made standard does not have a hot product, such as Apple iPhone, to promote it.  It is seldom used in the rest of the world.  So, many China mobile users switch to China Unicom, when they want to upgrade to 3G phones.  China Unicom uses the more widespread WCDMA standard. Chinese government is helping them to make the decision. People can switch between operators and keep their original numbers.  Many of my local Chinese friends are doing so.

If we check the MIIT data, we will see, for 2G, China Mobile has 70% of the market.  But for 3G, the three operators, i.e., China Mobile, China Unicom, China Telecom, have more or less the same number of users.  By July 2010, China Mobile had 11.8M 3G users, China Unicom 8.5M and China Telecom 7.75M.

This could be a good news for companies providing mobile services. China Mobile used to be the absolute monarch. It has 70% of the country’s mobile users and 90% of the data business – the part mobile services providers can participate. Now, the playing ground is leveling. There are three operators to choose from. Terms and conditions for partnership could be fairer and more stable.

Of course, the transition will be a long term process. And no one dares to not consider China Mobile’s response in any mobile related development at the moment.

But there are signs showing China Mobile cannot dictate mobile development anymore.  For example, the mobile payment.  China Mobile is the first to launch mobile payment in China, with a proprietary 2.4G Hz technology.  But, the other players in the industry, such as China Unicom, China Unionpay, the Chinese banks, prefer the 13.56M Hz worldwide standard.  Recently, China Mobile has softened its position. It will keep using 2.4G Hz for the existing cities that it has launched the services, e.g. Shanghai.   But for the other cities, it will also adopt the 13.56M Hz standard.

Sherman So

Author of Red Wired: China's Internet Revolution, the first book to completely survey the nature of China's internet. (http://redwiredrevolution.com/) She previously was the lead China technology reporter...

Join the Conversation

8 Comments

  1. Now I see why China will never catch up with the West, especially U.S. technologically. Not becausee of TD-SCDMA which you said its the worst 3G license, but because the mind set like you who ridicule the home grown technology, along with other millions like you who looked down your Chinese own home grown technology, never give them a chance and support. Same as automobile industry, believing foreign cars are the kings of the world, never give domestric companies a chance to earn enough money to invest in reesearch and development. I am delighted you reserve such Comunist regime to promote your Chinese technology. If Japan had not produced mediocre products 50 years ago, and got her people to support, it would not be as a great nation (with small population) as of today.

  2. Hey, you have problems with Chinese technology? Why are you so happy about its declining dominance? It sounds so sick.

  3. Chinese home grown technology???? China has hardly invented anything except for perhaps paper and firecrackers. All the modern technology in China today was stolen from western companies as “payment” for trying to get into the Chinese market. Also, the person who wrote the article really needs help with English. Don't you have any native English friends????

  4. China Mobile's 3G standard TD-SCDMA maybe is in a limbo, but its 4G standard TD-LTE has a lot of promise. Just last week it lunched trail services in six cities in China, and mobile operators from Australia to India are adopting TD-LTE too. TD-LTE is going global, and I don't see it stops at India & Australia. Not that I cheer for China Mobile's dominance, but the decline of China Mobile is greatly exaggerated.

  5. You must have been sleeping for a decade or so (:0 Keep dreaming and live in the past while China and other Asian countries surpass the western countries!

  6. CMCC will have to suck it up until 4G comes swinging in, when its TD-LTE – which, as commenter Allen pointed out already – expands from its recent very early testing phase.By that time, CU and CT will be enjoying a much more level playing field in the hi-tech mobile field, which will be good for consumers – I can foresee quite a battle between the 3 companies in the near future (next year?) when Apple makes its iPhone go 4G (i don't think Apple will push it out so early as 2011; they generally wait for much riper pickings).

  7. It is the worst because its stability, support from phone makers, portability around the world and other performance matrix is inferior, comparing to the other two standards, WCDMA and CDMA-2000. Not because it is home made. And everyone, including every Chinese, know that for a fact. I think the government has given TD plenty of support, by granting the strongest operator this licence. Otherwise, it has no chance to survive.By the way, for 4G the Chinese government is no longer going to interfere. It is just going to let the market decide.As of Japan, its own development is not without problem. Look at its economy for the last 10 years. I don't a direct comparison is relevance.

Leave a comment

Leave a Reply

This site uses Akismet to reduce spam. Learn how your comment data is processed.