CHL Boost TD-SCDMA Handset Range

Chinese wireless giant China Mobile (CHL - Snapshot Report) has reportedly expanded its mobile handset portfolio as the carrier unveiled 11 new devices designed to run on its proprietary TD-SCDMA 3G technology. These handset models are being developed by nine vendors including industry leading cell phone manufacturers such as Motorola (MOT), Samsung, LG, Huawei and ZTE. 

The newly launched mobile handsets were developed under China Mobile’s “TD-SCDMA Terminal R&D Incentive Fund” launched in March 2009. Out of the 11 models, 6 are positioned for the high-end customers under the "Flagship Broadband Internet Handset" project. Some of these handsets are designed for customers of China Mobile's online application store “Mmarket.com”. 

The remaining 5 models, which are priced at about RMB1,000 (US$146) per set, were part of the company’s "Low Cost 3G Handset" project. These handsets are designed to be used for wireless websites, mobile music, e-maps and financial information. Under its TD-SCDMA R&D incentive fund, China Mobile has reportedly allocated subsidies of RMB600 million (US$88 million) to develop these 11 new TD-SCDMA handsets. 

China Mobile is planning to spend more on 3G terminal subsidies in 2010. The company has tripled the amount of subsidies from the current year and is expected to spend up to RMB30 billion (US$4.4 billion) next year. A significant portion of the terminal subsidies will be allocated to facilitate the roll-out of 3G TD-SCDMA handsets. China Mobile currently has 241 TD-SCDMA terminals including 64 mobile handsets. 

China Mobile remains the lead player in the Chinese wireless market with 70% market share and more than 500 million subscribers. However, the company faces the threat of market share erosion due to stiff competition from its peers– China Unicom (CHU) - Analyst Report and China Telecom (CHA - Snapshot Report), as they both operate networks based on internationally acclaimed 3G technologies.
 
Leveraging the home-grown TD-SCDMA standard, China Mobile launched its 3G network in early 2009. The company currently has more than 3.9 million 3G customers. China Mobile is increasingly focused on keeping its 3G services away from competition by offering a large assortment of premium TD-SCDMA handsets and better value-added services. As part of this strategy, the company has collaborated with world’s leading handset and chip manufacturers.

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