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China Mobile Signs Deal to Lease TD-SCDMA Network from Parent Company

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Note -- this news article is more than a year old.

China Mobile Ltd has agreed to lease the TD SCDMA network being built by its parent company, China Mobile Communications (CMCC) and has announced that it will pay a maximum of RMB1 billion (USD146 million) during 2009. The company has already invested some USD2 billion building its trial network.

The figure has been agreed on by taking estimates of traffic and usage on the network by China Mobile subscribers. The term of the Network Capacity Leasing Agreement is for just one year, suggesting a level of uncertainty about the customer uptake of the network from 2010 onwards.

China's CCID Consulting issued a report earlier this year which predicted that the country would have 51 million TD-CDMA subscribers by 2011. CCID Consulting forecast that after an introduction period of deployment in 2008, TD-SCDMA will enter a peak period of deployment between 2009 and 2011.

The Leasing Fees are payable on a monthly basis in cash.

CMCC is currently expanding its TD-SCDMA 3G trials to 28 additional cities. The operator is currently trialling the network in eight cities, Beijing, Shanghai, Tianjin, Shenyang, Guangzhou, Shenzhen, Xiamen and Qinhuangdao.

Chinese state owned, China Mobile Communications Corporation (CMCC) is the ultimate controlling shareholder of Hong Kong listed China Mobile, holding indirectly approximately 74.25% of the total issued and outstanding share capital of the Company.

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Tags: china mobile  td-scdma  cdma  ccid consulting  China