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Unicom eyes massive 3G expansion

By Joey Kwok (China Daily)
Updated: 2009-01-15 07:07

China Unicom, the second-largest wireless carrier in China, said its third-generation (3G) mobile services will cover 55 major cities on the mainland within the first half of this year.

And Chairman, Chief Executive Officer and Executive Director Chang Xiaobing said the company plans to finish construction of its 3G network in 282 cities by the end of 2009.

"As we have estimated, the investment capital for 2009 and 2010 will amount to 100 billion yuan. We will spend around 30 billion yuan in the first half of 2009," Chang said yesterday after the company's general meeting in Hong Kong.

He also expects the construction investment in the WCDMA network, which the central government granted the license for last week, to reach 60 billion yuan by the end of 2009, while the company hopes to generate profits from the next-generation services in 2010.

"Through the merger of China Unicom and China Netcom, we hope to further utilize the resources of the two companies to help bring down our investment capital in 3G services," Chang said.

Concerning its bigger rival China Mobile's plan to provide 10 billion yuan in subsidies for mobile phones using the home-grown TD-SCDMA 3G services, Chang said China Unicom will consider giving such supplements to mobile phones using WCDMA.

However, he stressed, it is also important to balance the cost of subsidies and the earnings.

"The key is to adapt to the market," he said. "We are now exploring other ways to further improve our sales service."

He also admitted that China Unicom is currently lagging behind China Mobile and China Telecom in promoting 3G services.

"On the one hand, we want to accelerate our (development) steps," he said yesterday. "On the other hand, we have to ensure the quality of our network. I am more nervous than all of you."

Chang said China Unicom will continue to facilitate the sharing of resources with the two other carriers to minimize the overlapping of resources and maintain rational competition among the operators.

"The three operators need a compromising period to build up a good managing system," Chang said. "No matter how, it will benefit the entire industry."

Executive Director Zuo Xunsheng said the network-subscription price will face pressure to further decline because of intense competition.

The company, Zuo said, will try to overcome the pressure through strengthening its business development.