China is inching closer towards the long awaited launch of internet services on mobile phones after China Mobile said it would start trials of 3G wireless technology in eight cities on April 1.

The trials involving up to 60,000 China Mobile customers are considered a test of TD-SCDMA, the 3G mobile technology that is favoured by the Chinese government but is not commercially proven.

The 3G mobile technology is widely used in Japan, Europe and the US, and allows swift data functions such as web surfing on phones and e-mail.

Beijing gave no indication of when a much anticipated restructuring of the country’s telecoms industry would take place.

Many analysts believe the restructuring will precede or coincide with the issue of 3G operating licences to Chinese telecoms companies.

Beijing has promised some form of 3G mobile services for the Olympic Games that start on August 8, and China Mobile’s trials will run from April to July.

Some analysts believe China, the world’s largest mobile phone market, has been delaying the introduction of 3G services to allow TD-SCDMA to become operationally viable.

The unlisted parent company of China Mobile, the country’s largest mobile operator, has spent an estimated Rmb40bn ($5.7bn) building 3G networks based on TD-SCDMA in Beijing, Shanghai and six other places.

China Mobile will offer free 3G mobiles to 20,000 selected customers and free air time worth Rmb800 per month.

Another 40,000 customers could sign up for 3G services. They will, however, have to buy 3G mobiles at a slight discount to anticipated handset prices of Rmb2,000-Rmb4,000 each.

China Mobile is also offering 15,000 data cards for laptops that will enable wireless connections to the internet.

The advent of 3G services in China should unleash a sales bonanza for the country’s telecoms equipment makers such as ZTE and Huawei Technologies and possibly western rivals such as Ericsson. China Mobile has ordered 3G phones from four Chinese manufacturers including Lenovo and ZTE, plus two Korean companies, Samsung and LG.

China Telecom and China Netcom, the country’s largest fixed-line phone companies that are hoping to become mobile operators after the industry restructuring, said they had not fixed dates for commercial trials of 3G services.

They have built TD-SCDMA networks in the northern cities of Baoding and Qingdao respectively.

Vodafone, the UK mobile group, and Telefónica, the Spanish telecoms company, are hoping to increase their exposures in China after the industry restructuring.

Vodafone owns 3 per cent of China Mobile, while Telefónica has a 7 per cent stake in China Netcom, which is due to increase to 10 per cent.

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