China to build 3G network with own technology

China is to begin building a national network for "third generation" mobile telephones based on a home-grown standard, bringing the government closer to issuing long-awaited licences for the new technology.

The Ministry of the Information Industry said the TD-SCDMA technology had been selected as a national standard and network construction would shortly begin, according to the Xinhua news agency.

Although the news China is endorsing its own standard will come as no surprise, the announcement could mean it will shortly begin awarding licences for 3G wireless services, with the domestic standard potentially given a headstart over the two most widely-accepted global standards - WCDMA and CDMA 2000.

Beijing has delayed introducing the new generation of services while the TD-SCDMA technology encountered problems in development. A trial network has been set up in several cities.

"The technology is already mature and ready for manufacturers to move ahead with production . . . A stand-alone network will be built for the home-grown technology," the Xinhua report said.

Although China is one of the biggest markets in the world, it has had little influence on technology standards, which some officials believe has given an advantage to multinational equipment manufacturers.

Industry executives had initially expected China to award four 3G licences in the first half of this year, with the domestic standard playing only a minor role. However, in recent months some executives say the government has appeared more likely to first issue a licence for the TD-SCDMA standard in order to give it market advantage. China Telecom is the favourite to be the operator for the first licence.

Strong support for the Chinese standard would boost local equipment companies.