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China's investment on 3G equipments will reach RMB 10 to 20 billion

July 4, 2006

Analysys International says in its recently released report ''China's 3G Network Implementation Focus Report 2006'', that China's first round of investment on 3G equipments will reach RMB 10 billion to 20 billion.

The coming of 3G will definitely bring strong impact on the overall telecom market in China. Every link of this industry chain will benefit from this market, including main equipments manufacturers, fiber & cable manufacturers, terminal manufacturers, system integrators, and other vendors of auxiliary lines such as electricity power, instruments, etc. To grasp business opportunities and win contracts in the coming new round of investment cooperation with operators has become imminent for all system/network equipment vendors. Some foreign vendors had started their PR campaigns targeted at operators with the advantage they have gained in 2G/2.5G era. China's 3G equipment market has already been activated quietly.

According to Analysys International's ''China's 3G Network Implementation Focus Report 2006'', if one 3G license will be released in 2006, the first phase of 3G network implementation should reach 10 million lines to 20 million lines to meet the user demands. Therefore, the first round of investment on 3G equipments will reach RMB 10 billion to 20 billion if each line cost about RMB 1000.

According to Analysys International's research, ''If China Mobile get the first license, it will have enough capability and capital to carry out the construction of 3G network. While if China Telecom get the license, it will probably solve the problem of capital gap by indirect financing,'' Says Mr. Cui Xiaolong, analyst from Analysys International, ''But if China Netcom or China Unicom get the first license, neither of them can build up the 3G network alone. China Netcom's selling out Asia Netcom can be viewed as the capital preparation for 3G. But anyway, China Netcom and China Unicom do not have enough capital power to build up 3G networks alone. We suggest that they can establish joint venture to construct 3G network together.''

This subject is further discussed in Analysys International's research report ''China's 3G Network Implementation Focus Report 2006''.

 

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