China Mobile Kuang Guohua: Real Hope in TD-LTE

How will China Mobile in the "Guo Guohua era" cope with the changing competitive environment? Yesterday, the new head of China Mobile made public appearance for the first time. He said that China’s move will fully invest in TD and TD-LTE, and it will not push into the fixed network. In his view, the current “more terrible” is competition from Internet companies.

In the gap of the 2012 Asian Mobile Communication Expo held yesterday, Guo Guohua explained the company's latest strategy to the media for the first time. Ruan Guohua believes that China Mobile currently has two main rivals: First, the traditional operator. He describes this as a competition between the "three sheep" and is an effective competition scenario. Competition from Internet companies is even more terrible. In the wave of mobile Internet, business traffic has become a common issue for global operators.

He pointed out that China Mobile will deal with three levels: First, 2G networks, 3G networks, WLAN, and 4G networks will grow together; Second, it will adopt a full-service strategy to enter the fixed network; Third, it will promote the mobile Internet strategy. Yesterday, China Mobile and Sohu, UC, and Sina jointly announced the new Sogou Input Method Fetion Edition, UC Browser Surfing Edition, and Sina Weibo G3 Mobile Internet Product.

The cooperation between China Mobile and Apple has always been the focus. Kuang Guohua pointed out that the most crucial factor lies in technology. At present, the TD-LTE chip is not yet mature, and Apple pursues first-class quality, and non-high-quality chips are not used. He said that when the TD-LTE-enabled Apple mobile phone was launched, it can't depend on China Mobile, nor does it depend on Apple, but on Qualcomm.

For the commercial development of 4G, TD-LTE, which is of great concern to the public, he explained that China Mobile currently conducts 4G scale trials in ten cities. At present, the biggest bottleneck is in the terminal. Once the terminal is mature, China Mobile will upgrade from TD to 4G in a short time.

While there are arguments that TD is a transitional technology, Zhai Guohua said that TD is the cornerstone of 4G, and it is insurmountable from the national point of view. "China Mobile is really doing TD." He said that this year will continue to increase the subsidies for TD mobile phones, while the fifth phase of the six-phase expansion project will continue to improve the network.

TD-LTE is the top priority for China Mobile. According to China Mobile's plan, China Mobile will increase the number of TD-LTE cities to 10, and the base station scale will increase from the current 20,000 to 200,000 in 2013.

This led to some controversy. "Is it true that TD-SCDMA can not be crossed? My conclusion is that we cannot leapfrog," said Guo Guohua. "If TD-LTE matures for at least two years, what will China Mobile rely on to hit the market? If it is a two-year gap, then The market was taken away."

If you look at the perspective of investment return, Kuang Kuo-hua believes that the later commercial use of TD-LTE, the easier it is for TD-SCDMA to reach a break-even point, but because TD-SCDMA can smoothly transition to TD-LTE, "You can't just look at TD-SCDMA itself. It is more reasonable to calculate the general ledger between the two."

Kuang Guohua pointed out that the rapid development of mobile internet has increased the data traffic of China Mobile by 150% in recent years. In addition, the substitution of Internet services for traditional telecommunication services also exposes operators to the risk of “dumb pipe”.

He believes that China Mobile is unstoppable and really hopes for TD-LTE. Unlike the dark years ago, China Mobile now sees the dawn of oriental fish.

For China Mobile’s bid for a fixed-line license, Kuang Guohua said: First, it did not give a China Mobile license, and it could also do it through China Railcom’s fixed-line license. Second, China Mobile’s fixed-line business would have a choice to do. Third, China Mobile would not Engaging in price wars, China Telecom and China Unicom need not worry.

The existing policy hurdles mainly come from licenses issued to the three major operators after the reorganization of the telecommunications industry in 2008. At that time, China Telecom’s acquisition of China Unicom’s C network and acquisition of mobile licenses amounted to RMB66.2 billion. China Mobile’s basic telecommunications business license is not fixed. The network business, China Unicom is already a full-service operator.

Later, on December 25, 2009, the Ministry of Industry and Information Technology issued another “Department of Industry and Information Technology to publish a circular on further implementing the spirit of the document governing the order of the telecommunications market” (Ministry of Industry and Information Technology No. 686). The document clearly states that: China Mobile can only The company operates a wireless broadband access service using the TD-SCDMA network, and the cable broadband service is authorized to operate by China Tietong Group Co., Ltd. This was interpreted by the industry as a policy prohibiting China Mobile from directly operating fixed-line broadband.

“The restrictions on China Mobile's fixed network licenses are asymmetric controls. The formulation of this asymmetric control policy was still led by me during the year. After the move, the bell must be tied up. I am under pressure now,” he said. The background of the introduction of the policy was that of Guo Guohua, former minister of the Ministry of Information Industry and the Ministry of Industry and Information Technology.

He said, "The situation was that China Mobile had a large share. In order to balance the market, the 686 document was formulated. At that time, it was a two-year restriction. Whether China Unicom could get a WCDMA license could develop rapidly."

He also pointed out that "At that time, Document No. 686 did not seal the policy and China Railcom had a fixed network license. In other words, China Mobile can use China Railcom to do fixed-line business. In the past two years, China Mobile has done so. Of course, if It would be better to get a license directly because it can avoid related connected transactions."

Ruan Guohua said that whether China Mobile can obtain a fixed network license depends on the government's decision. The Ministry of Industry and Information Technology is currently studying it.

At present, China Unicom and Telecom both have full business operating licenses, and China Mobile’s China Railcom has also been operating fixed network. Kuang Guohua pointed out that in order to balance the telecommunications structure, China Mobile’s fixed network license was not awarded to the last telecommunications industry restructuring, and the related regulatory policies had expired at the end of last year.

To this, Zhai Guohua has made clear two major attitudes: First, relying on Tietong can also be a fixed-line business. Of course, if you get a license directly, it will be of greater significance to listed companies. Second, if you obtain a fixed-line license, you will certainly not be able to Entering the battle will not result in a price war.

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