The post I wrote about China Mobile got a quite few feedbacks. Thank you for reading it and even more if you have left a comment.

Some of the readers are quite mad that I am not supportive of the home grown 3G standard, calling it the worst among the three licences.

First of all, I call it the worst, purely from a performance point of view. I don’t care where it is made. And if you have problem with that, check with a technician, or someone who has tried the different services, i.e. China Mobile’s 3G, China Unicom’s and China Telecom’s.

Secondly, I would like to take the opportunity to discuss about TD. Whether it is a blessing or a curse for China, as a whole. I first studied TD in 2007. There was a national conference on technology in Shenzhen. I was still working for South China Morning Post in Hong Kong. So, I crossed border to attend the conference. Lots of interesting stuff. And there was a whole section about TD-SCDMA. I’ve already known by then, it is something important. And I spent a whole afternoon, talking to the persons in the different booths. I also made friend with one of them. His name is Andy and he worked for a company called Commit. It was one of the four companies that made TD-SCDMA baseband chip. For people who don’t know what is baseband chip – it is one of the most important chip in the mobile phone, responsible for communication. And it is the key of TD technology. Before Commit, Andy worked for Datang – the company which invented TD-SCDMA and holds its core IPs.

Andy currently works for Huawei on TD-LTE. So, he basically built his whole career on TD. But, what is he view on TD ?? He thought China did not get anything out of it.

Datang, which invented the standard, does not earn much on loyalty fee. The domestic manufactures, which are supposed to benefit from making products of the home grown technologies, do not prosper, either. In fact, Commit has gone out of business. (ZTE and Huwei are benefiting from making 3G infrastructures for the operators – but they offer solutions for all the three standards.)

Originally, as Qualcomm holds most of the 3G IPs, China hoped by developing its own standard, it can bypass Qualcomm, and save the loyalty fee in building its 3G network. But TD is not original enough, and TD products still have to use many Qualcomm IPs. (That is part of the reasons Datang does not have much loyalty fee. Another reason is TD is not popular enough.)

As the development of TD was funded by China only, it was slow and painful. The deadline for finishing TD development was delayed again and again. So, the granting of 3G licences in China was also delayed again and again. Andy said, all in all, if there was no TD, China would have 3G five years earlier.

A five-year delay is critical for many of the startups who was banking on the popularity of mobile internet. 5 years ago, many of them started their business hoping 3G would come and people would start surfing the net with their phones. One of them is a Shanghai company which provide mobile search. But, 3G did not come until recently. And today, that company is still small, with about RMB 20 million revenue. The CEO is very supportive to Chinese government. China Mobile is his business partner. But, even he agreed, if 3G could come 5 year earlier, his business will be in a much better shape.

As of the end consumers, if 3G could come 5 year earlier, today, they can enjoy a much cheaper rate for going online with their phone.

In conclude, I think no one win in this TD business. Andy said, for 4G, the Chinese government is not going interfere anymore, it will let the market decide.

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...

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2 Comments

  1. ShermanAs you note, TD is 1-3 years behind which has slowed the migration to 3G, a high price. But it has advantages for China that are visible here in New York. When I began reporting on broadband in 1999, standards were dominated by the U.S. and a few European giants. I watched closely a debate between two VDSL standards, DMT and QAM. Asia spoke up for QAM, which was much less expensive, but was barely heard in the standards debate which was dominated by Texas Instruments (who collects royalties on DMT) and their partner Alcatel. The focus is rapidly changing, with America playing less of a role and Asia ascending. Breaking the international consensus of FD LTE taught everyone involved they dare assume Asia will go along passively. It was a “declaration of independence” on international standards that was heard around the world. The existing royalty system is far too expensive and slows innovation with all the lawsuits. It needs to be made reasonable. I just wrote Hillary and Bill (Gates)A fantasy. Hillary Clinton should look Bill Gates in the eyes and insist, “Microsoft needs to shut up about intellectual property. Korea faces a nuclear war. When I ask Wen Jiabao to help keep the peace, I don't want to be distracted by your demand for royalties. The U.S. State Department needs to stop being a collection agency for Microsoft and Qualcomm. It's time for you to make your peace with the laws of the countries in which you want to do business.” Currently, the U.S. collects $10's of billions yearly on “intellectual property” and the government supports strong and even abusive interpretations of what's reasonable. DSL is down to four chipmakers, partly because fear of business-crippling patent suits like TI v. Conexant scared off new entrants. The balance will change against the United States over the next few years. Huawei has applied for 42,543 patents (China Daily.) Their Shenzen research center matches the best in the world. Huawei is building space for 30,000 R & D workers in Wuhan, China's optical capital. A WSJ headline China helps defuse Korean crisis inspired this item. ———————- China, like Brazil and India, has long worked for lower costs for all, a good thing not sufficiently respected by the western industry-dominated standards groups. db

  2. I agree with Dave that Asia or China are ascending in technology innovation and breaking the monopoly of the America. This is a good thing for the whole world. TD-SCDMA, in particular, did not achieve all its goals. But it does not mean, China cannot have another technology innovation in the future, that could really shake the world and benefit everybody involved. Just as many people, I believe the Asia era has come. Another point I noted is that, discussion about technology often cannot limit to technology alone. It often involve issues like politics and even the peace of the world.

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