Developments in Chinese telecom

Includes: CHA, CHL, CHU, CN-OLD
by: Ezra Marbach

Details on a China Unicom (ticker: CHU) license win, a DSL subscriber update, a budget phone package from China Mobile (ticker: CHL), and a mobile phone for gamers from Qualcomm (ticker: QCOM):

China Unicom (ticker: CHU) wins Macau's CDMA license

China Unicom (ticker: CHU), the second-largest mobile operator in China, beat four rivals to win a CDMA service license for China's Macau Special Administrative Region.

The company will now offer Macau citizens CDMA and value-added services when they travel to China's mainland. But in the first year of operation, the company will mainly focus on servicing tourists visiting Macau. Currently, Macau only offers GSM service for mobile communications. GSM has reached a penetration rate of 100% in the city of 460,000 people.

With economic development bolstered by the gaming, tourist and convention industries, Macau enjoyed 16 million visitors last year.

China Unicom's Macau project is the first example of a Chinese telecom company building a network outside the mainland.

China DSL subscriber update

DSL lines around the world increased 60% to 97 million in 2004. China had the most DSL lines with 17 million, up 4.4 million. The US has 13.7 million DSL lines. Demand for DSL continues to be strong in Europe with France, UK, Germany and Italy all adding more than 1 million lines each in 2004.

China Mobile (ticker: CHL) subsidiary launches budget call package

To expand their share of the mid-range market, Shanghai Mobile, the largest mobile telecom operator in Shanghai, has unveiled a budget phone call package for users of its prepaid Shenzhouxing Jiajia Card service.

Analysts regard the new package as a challenge to Shanghai Unicom, Shanghai Mobile's key rival and Shanghai's No. 2 telecom operator, particularly for mid-and-lower budget telecom subscribers.

Qualcomm (ticker: QCOM) develops game-ready phones

Qualcomm China announced that it has developed two types of mobile phone chips which can be used to support new 3D games available for mobile phones in China. According to the company, the first group of mobile phones embedded with such chips will come out by the end of 2005. A number of international game developers, including Disney (ticker: DIS) and Sony (ticker: SNE), have begun cooperation with Qualcomm to develop 3D games for this new mobile phone.