China's national 3G standard lags despite promotion

The carrier's huge user base has brought few subscribers to TD-SCDMA

Nearly one half billion people subscribed to China Mobile cellular services last month, but the giant's efforts to promote a Chinese 3G standard have made little headway.

The world's largest carrier grew to 498 million mobile subscribers last month, a number larger than the populations of the U.S. or the European Union. The number of subscribers using their mobile phones to play games, download music and surf the Internet also rose during the first half of the year, China Mobile said Thursday.

But growth was slow for TD-SCDMA (Time Division Synchronous Code Division Multiple Access), a domestic 3G mobile standard that the government tapped China Mobile to market. Subscribers surpassed 1 million in July, continuing a slow climb upward from the launch of TD-SCDMA services in January.

3G growth has been slow in China because of a limited selection of attractive 3G handsets from each of the country's carriers, and because few users demand data services so far, sticking instead to voice calls and text messaging, analysts say. High-end users willing to pay for 3G subscriptions are rare and concentrated in major cities.

The number appeared to put China Mobile far behind its 3G growth target. The state-run carrier aims to have between 50 million and 80 million 3G subscribers by the end of next year, the head of China's IT ministry said last week.

The carrier has begun integrating its 2G and 3G networks so users can upgrade without switching numbers, a move to encourage the switchover by subscribers, it said in a statement. Its 3G coverage has reached 38 Chinese cities, it said.

China Mobile is competing for 3G subscribers with the country's two other carriers, China Unicom and China Telecom. But its rivals have the advantage of using 3G standards already proven and widely used outside China. China Mobile is the only carrier worldwide using TD-SCDMA.

Only one-quarter of the 3G handsets sold in China in the second quarter supported the China Mobile standard, according to Chinese research outfit Analysys International.

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Owen Fletcher

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