ZTE Wins Major Contract to Build China Mobile’s 4G Network in 5 Cities

China Mobile shows off a 4G-equipped car at a recent event (Image: Techinasia.com)

Phone-maker and telecoms firm ZTE (HKG:0763; SHE:000063) might be reviled in the US, but it’s still loved by fellow Chinese companies. To prove that, China Mobile (NYSE:CHL; HKG:0941) has just awarded ZTE the contract to construct China Mobile’s 4G TD-LTE networks in five Chinese cities: Beijing, Tianjin, Guangzhou, Shenzhen and Shenyang.

According to ZTE’s announcement today, this new tender also means the company will produce 20,000 4G base stations for China Mobile during its slowly expanding test phase. That’s currently going on in 13 Chinese cities ahead of an expected national 4G launch in, according to China’s minister of industry and IT, 2014 or 2015.

ZTE beat out bidders from around the world for this major TD-LTE contract, such as Ericsson, Nokia Siemens, and its compatriot Huawei.

Authorities are taking the 4G rollout very slowly as it tackles the issue of slow uptake of 3G in China. Official stats from all three mobile telcos in the country reveal that there are just over 130 million 3G subscribers in the country, with more than 60 million of those on China Mobile, the world’s biggest mobile telco. That’s a fairly big number, but it’s actually quite a small slice of China’s one billion mobile subscribers.

China Mobile might be the only mobile telco in China that will use the homegrown TD-LTE protocol for 4G, though that is not yet clear. China’s TD-LTE standard is being adopted outside of China – but if China Mobile is all alone in using TD-LTE in China, then it could face a re-run of its awkward lack of quality phones caused by it using the homegrown TD-SCDMA 3G standard. That has caused it to never get the official iPhone deal from Apple, and the iPhone does not support TD-SCDMA at all.