(Sept. 2, 2009 - Chinavestor) China Mobile (NYSE:CHL), the largest mobile carrier in the world by subscriber base, is under pressure to roll out a successful 3G network. China Mobile is the only Chinese mobile carrier that reported revenue and profit growth for the first six months of 2009 (Earnings Season is Over, New Opportunities Lay Ahead), yet has been underperforming compared to China Unicom (NYSE:CHU) and China telecom (NYSE:CHA) due to lack of 3G growth. A little industry background. All three main carriers in China received licences to operate advanced networks but China Mobile got stuck with a home grown TD-SCDMA network protocol. This is turn has been hindering efforts to convert current GSM subscribers from 2G service to smart phones that require 3G.
But considering the latest developments, I am positive that TD-SCDMA is going well due to the following reasons:
1. TD network has covered 38 main cities, and the quality improves, comparing to the start of 2009. CHL's target is to build TD-SCDMA stations in 200 cities at the end of year.
2. In order to provide more handset models to customers, up to 200 models at the end of year, China Mobile (NYSE:CHL) has signed up cooperation agreements with many handset suppliers such as Nokia and HTC. Furthermore, the Ophone is expected to be launched soon.
3. Mobile Market has be launched and is improving quickly in terms of different services. Mobile Market is a software and information provider website that is similar to iTunes store of Apple.
In essence, outlook for China Mobile 3G is positive.
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