China issues 3G licenses

China issued third generation (3G) mobile phone technology licenses to three state-owned telecom operators yesterday, state media reported. As expected, China Mobile received a licence for TD-SCDMA, the domestically-developed 3G standard, while China Telecom will use the US-developed CDMA2000 and China Unicom will use Europe’s WCDMA. All three standards should allow for faster data downloads, enabling video phone calls and other advanced features. The Ministry of Industry and Information Technology (MIIT) also issued 23 regulations on 3G operational requirements. China hopes the move will stimulate billions of dollars in investment in new 3G networks to handle the data transmission. Sinolink Securities analyst Chen Yunhong predicted that 3G cell phone sales will top US$44 billion between 2009-2011. Possible beneficiaries would be network equipment and cell phone manufacturers. However, shares in all three China telecom operators fell following the news.