By the Blouin News Technology staff

China Mobile ventures into 4G

by in Enterprise Tech.

An Indian man uses his cellular phone next to a banner advertising China Mobile phones in Hyderabad on January 5, 2012.

A cell user next to a banner advertising China Mobile phones in Hyderabad. AFP/Getty Images/Noah Seelam

Fourth-generation mobile internet services are spreading slowly but steadily, with China next in line for an upgrade. China Mobile — the largest carrier of phone services by number of users — released news at Barcelona’s Mobile World Congress in February of its intention to roll out 4G LTE licenses during the rest of 2013, leaving the tech world ruminating over what kinds of newfangled handsets will be made available to China Mobile customers with 4G capabilities. The chairman of the telco, Xi Guohua, reaffirmed this network expansion on March 13 when the company released its earnings.

China Mobile’s network runs on technology that does not support 4G capabilities at all currently, so a multi-city expansion is a multi-year project. Indeed, the company does not anticipate seeing revenue from the network build-out for years, but revealed its planned investment into 4G coverage will cash in at the equivalent of USD $6.7 billion. The 4G expansion will require the company to increase capital spending by 49%, according to reports. This announcement coincided with revealing that the company’s profits rose just 2.7% over the last year as it grappled with what Xi described as “a more complex competitive landscape.”

The investment will also open the proper iPhone market to China Mobile’s 715 million subscribers. While reports note that the company currently hosts 10 million iPhones on its network, indicating that users find ways around the network incompatibility, China Mobile would finally catch up to China Unicom and China Telecom whose networks have been iPhone-compatible for years. (China Unicom has carried the iPhone since 2010, with China Telecom jumping on board in 2012.) The iPhone, however, is not the be-all-end-all for the Chinese market. Huawei, HTC, LG, and Samsung have all designed and debuted smartphones destined for China Mobile’s coming 4G network — and have seen success in China’s market through selling less expensive feature phones and lower-end smartphones, most of them running Android. (The popularity of which is now a point of concern for the Chinese government.)

While U.S. carriers have been operating 4G-capable networks since 2010, the U.K. government only just auctioned off 4G spectrum to bidding telecoms in January. And talk of a North and South America LTE roaming band was another hot topic at Mobile World Congress. China Mobile is gearing up for the cell network future in a big way — its 4G move will cover 100 cities in 2013, and reach 500 million people. And it comes at a time when 4G wireless technology is getting harder for carriers to avoid around the world. The next significant moves will have to be from Europe as telcos wrestle with dividing spectrum, foreign mobile software and hardware-makers like Ubuntu, Mozilla, and Huawei bring new devices and platforms to their shores, and installing more 4G ports for more wireless coverage. And with China’s government finally doling out 4G licenses, that country could well be the next frontier for the new era of wireless.