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China Mobile GSM -, China

Key Data

China Mobile is a state-owned enterprise and is widely regarded as one of the world's largest mobile operators. The company was established after the reorganisation of China's telecommunications industry in 1999. Its major businesses include mobile voice, Internet Protocol (IP) telephony and multimedia services. China Mobile is now in talks with Google (2006) to bring internet search services to its network.


"China Mobile's major businesses include mobile voice, Internet Protocol (IP) telephony and multimedia services."

The company has evolved since the reorganisation and now is responsible for, or has subsidiaries in, all 32 administrative regions or provinces. China Mobile has a total of 247 million subscribers – 70.632 million contract and 176 million prepaid – in the fourth quarter of 2006, an increase of 23 million on the 2005 subscriber total. It is currently adding 2 million subscribers per month.

China's total number of mobile phone subscribers is estimated to be in the region of 450 million currently, but is expected to increase to 600 million by 2009. Over 100 million mobile handsets have been sold in China in the past year.


Historically (since 1995) Motorola was a major GSM network supplier to China Mobile Communications Corporation (China Mobile). A number of contracts awarded since summer 2000 to improve and expand GPRS and GSM services throughout China have highlighted this close relationship.

Now the company has cast its net further afield and because the task of upgrading and maintaining its networks is such a massive task, a whole range of mainstream equipment suppliers have been asked to contribute.

China Mobile has awarded a series of contracts since its last Motorola upgrade in 2002. As one of the leading mobile providers in China, China Mobile has to make sure that the network is able to provide the most up to date services. A big challenge will be the eventual evolution to 3G services, given that coverage is so wide and the network so large. When 3G licences are granted the spending on new equipment could, for all of the Chinese mobile telecoms companies, be more than US$12bn.


In October 2001 a contract was signed to expand China Mobile's GPRS system across seven provinces and municipalities. It also covered a further expansion of GSM services across the areas, plus ten other provinces. Both of these expansions were completed by December 2001.

In early 2002, Motorola Inc, in conjunction with Cisco Systems, was awarded a GPRS and a GSM network supply expansion contract by China Mobile worth $95m. The contract was for the expansion of the GSM 900 network in Beijing and Sichuan by 1.5 million subscribers and was completed towards the end of 2002.

The network used the Motorola Horizon infrastructure but also involved the installation of packet control units (PCUs) and operation and maintenance centre radios.


Ericsson was chosen by China Mobile in mid 2004 to provide equipment for its CMNet phase two IP backbone networks expansion in all 31 Chinese provinces and autonomous regions.

"China Mobile had a total of 224 million subscribers in 2005."

The phase two expansion was designed to increase backbone bandwidth, reliability and the range of mobile internet applications available to subscribers. The expansion (completed in October 2004) has improved the overall scalability of the network and allowed a more efficient use of bandwidth through Multiple Protocol Label Switching (MPLS) traffic engineering.

Ericsson provided IP / MPLS routing platforms through an association with its partner, Juniper Networks. Ericsson provided AXI 580-3 and AXI 520-8 IP backbone routers and also expanded the existing AXI 520-4 routers. Ericsson was also the sole equipment supplier of the phase one IP backbone networks in 2000.

In early January 2005 China Mobile selected Nortel to expand the digital wireless network in six regions under a series of contracts worth an estimated $150m. The contracts include network optimisation services from Nortel to streamline performance of the expanded infrastructure and enhance network productivity while allowing China Mobile to standardise tariffs across all regions.

The GSM network expansion in these six regions has increased subscriber capacity by 3.48 million to a total of approximately 18 million. The expansion has improved network coverage and services to remote areas while providing a smooth migration to future 3G services.

The expansion has also supported China Mobile's National Rural Network Project in the northern and western provinces of Hebei, Shaanxi and Liaoning, the municipality of Tianjin, the Xinjiang Uygur Autonomous Region, and the eastern province of Hunan.

The Nortel GSM / UMTS expansion included network infrastructure, software upgrades and support services. The equipment is HSDPA-ready and designed to easily upgrade to support HSDPA through software installation. This gives China Mobile the flexibility to cost-effectively upgrade its networks as required.


Ericsson was awarded a $550m contract in August 2006 to expand GSM mobile networks in 17 Chinese regions for China Mobile. Ericsson has started deliveries of network equipment which it claims will be able to support an additional 200 million subscribers across the 17 regions.

Under the new contracts, Ericsson is to provide China Mobile with core and radio networks, together with related technical support and services. It will also deploy its Mobile Softswitch Solution in the contracted regions. The expansion projects will not only allow China Mobile to boost network capacity while enhancing operational efficiency and cutting costs, but will also pave the way for future network evolution.


China Mobile is one of the largest mobile telecoms companies in China and is constantly merging and taking over smaller companies. If as is expected there is a consolidation of mobile telecoms providers forced by the Chinese government before they will issue 3G licences, China Mobile would expect to be one of the survivors. The executives of China Mobile expect the 3G licences to be issued in mid-2007 and have made a pledge to have full 3G services operating before the 2008 Olympics begin in Beijing.


In late 2004 Hebei Mobile, a provincial affiliate of China Mobile, awarded a contract to Nortel Networks for Wireless Network Expansion and optimisation in Hebei Province. The contract was estimated at $46m and was able to increase Hebei Mobile's subscriber capacity by approximately 880,000.

Nortel Networks was able to provide Hebei Mobile with network infrastructure, software upgrades and support services. The network upgrade will also allow easy migration to 3G when the licences are granted by the Chinese government in 2007.

"China Mobile expanded its digital wireless network in six regions under a series of contracts worth an estimated $150m."


In early 2006, Shanxi Mobile a subsidiary of China Mobile contracted Alcatel to expand wireless services in seven Chinese cities. The expansion project is using Alcatel's Evolium GSM / EDGE solutions for upgrades in seven cities in Shanxi province that will extend service to another 3 million subscribers.

The contract, along with a second deal for spare parts, is worth €24m ($28.8m) to Alcatel and is the 11th contract for GSM network expansion entered into with Shanxi Mobile since 1996.


Guangdong Mobile is a provincial branch of China Mobile with an IP operation network covering 22 cities in the Guangdong province. In early 2006 Asia Info, a telecoms software and security products supplier completed a phase three IP network expansion for Guangdong Mobile.

The project is expected to optimise Guangdong Mobile's IP network performance following upgrades to the carrier's IT network backbone and aggregation nodes.

Asia Info has also aided in the creation of a wider platform to support Guangdong's data services business by establishing a Quality of Service (QoS) standard throughout the network, adjusting Border Gateway Protocol (BGP) network access and developing a Multiprotocol Label Switching (MPLS) VPN service platform.


In late July 2006, Nokia signed an agreement with Hunan Mobile Communication Co, a local arm of China Mobile in Hunan province, for GSM expansion. Under the terms of the agreement, Nokia will provide Hunan Mobile Communication with a mobile SoftSwitch system and services including network integration, trial operation, and training that will cover the four major cities of Hunan Province.


Early in July 2006, Nokia also signed a $150m contract to expand GSM and GPRS networks for Henan Mobile in Henan province. The proposed expansion is meant to significantly increase network coverage and capacity for mobile phones in the province's rural areas. Nokia said it is deploying its NetAct network and service management system in Henan. Under the contract, Nokia will also provide network planning, implementation, commissioning, training and care services. The network expansion was operational by the end of September 2006.