The China Blog: Online Gaming, Telecom, Digital Home...

Monday, January 23, 2006

China's TD-SCDMA ready for commercial debut

Jason Dean at the Wall Street Journal today reported that the Chinese government approved China’s local cellular technology, TD-SCDMA, which is one of the three international 3G standards (the other two being CDMA2000 and WCDMA). China is now one step closer to making 3G licenses available to major operators.

Friday's statement, published on the Ministry of Information Industry's Web site, makes TD-SCDMA the first of the 3G standards to be formally approved in China, Wang Lijian, the ministry's spokesman, said in a telephone interview. The other two are still being reviewed, he said.

In 2002, I predicted that 3G would not become a reality until the 2005-2006 timeframe. One of the major reasons I saw at the time was the immaturity of the TD-SCDMA standard. During the past several years, several major international vendors, including Siemens and Alcatel, have thrown their support and weight behind the Chinese standard. In the meantime, local companies such as Huawei also made significant investments in developing TD-SCDMA products. It is clear that even if the government does not bundle 3G licenses with the technology, it will at least wait for the technology mature before allowing carriers to launch services. Otherwise, CDMA2000 and WCDMA will bypass TD-SCDMA, the most promising technology standard developed by Chinese entities.

It is widely predicted that TD-SCDMA technology will be adopted by China Telecom, the dominant landline carrier. China Unicom and China Mobile are more likely to go with CDMA2000 and WCDMA. China’s mobile subscriber number is expected to pass 400 million in early 2006.

Wednesday, January 18, 2006

Reuters reports number of Chinese Internet users

The number of Web users in China, the world's second largest Internet market, grew by 18 percent in 2005 to 111 million, the Economic Daily reported on Wednesday.
Some 8.5 percent of the country's 1.3 billion people now had access to the Internet, the newspaper reported, citing a survey released by the China Internet Network Information Center.
State media previously predicted 120 Chinese million would be surfing the Web by the end of 2005 as computers find their way into more homes and domestic telecoms networks grow.
The 2005 gains represented an acceleration from 2004, when the number of Internet users grew 16 percent to 94 million.
More than half of China's Web population -- or about 64 million people -- accessed the Web via broadband connections, suggesting a 50 percent increase versus 2004 as China strongly promotes the development of its broadband networks.
The Internet's explosive growth in China has come despite the government's stepped-up efforts to control of the medium, in which occasional pockets of free speech have appeared in chat sites and blogs.
China is the world's No. 2 PC market, with nearly 16 million units shipped in 2004 and the number expected to have grown another 13 percent last year, according to data tracking firm International Data Corp.
PC makers, such as industry leaders Lenovo Group Ltd., Founder Group and Dell Inc., shipped 5.2 million units in the third quarter of 2005, according to IDC.
The growth of the Internet has also spawned a growing number of local online players, including Yahoo-invested e-commerce firm, Web portal Sina Corp., online game firm Shanda Interactive Entertainment and online search firm Inc..
Major mutlinationals attracted by the market's big growth potential have also set up shop in China, including online auctioneer eBay Inc., online retailer Inc. and online search leader Google Inc..

Tuesday, January 17, 2006

China Broadband Numbers

China’s Broadband Growth Remains Strong
The Ministry of Information Industry (MII), the regulator of China’s telecom and IT industry, reported more than 37 million broadband subscribers at the end of November 2005. By the end of 2005, the number of broadband subscribers will for the first time exceed that of dial-up subscribers, which currently leads broadband subs by 0.07 million. Compared to the end of 2004 (23.85), broadband subscribers have grown by 55. xDSL is still the dominant access technology, with more than 27 million subscribers. Chinese operators are adding more than one million broadband subscribers per quarter. The leading operators are China Telecom (with more than 55% of the market) and China Netcom (with more than 22% of the market).
The MII does not break out the number for residential subscribers. I believe that commercial subscribers (companies, government agencies, Internet Cafés, etc.) account for about 20% of the total subscriber number. As more consumers sign up for broadband access, this percentage will go down. I think a reasonable estimate for EOY 2005 broadband households is 31 million. Considering that the majority of broadband households live in urban areas and that there are more than 130 million urban households (out of more than 370 million total households), the current broadband penetration of immediately addressable market is around 28%. Unless the Chinese government aggressively pushes broadband access into rural areas, market growth will be limited to urban areas. I believe broadband penetration in large cities such as Beijing and Shanghai will soon exceed 50%, thanks to the low monthly fee, rapid economic growth, and the Olympics Effect.  

Monday, January 09, 2006

Intel Launched ViiV in China

Just came back from a busy and crazy week at Las Vegas. The show keeps getting bigger. According to the CEA, more than 150,000 people attended this year’s event. Among the many hot new products and concepts being showcased on the floor, portable video/audio, big HDTVs in 1080p resolution, Internet video delivery, content sharing and remote access, and whole-home entertainment seem to be attracting many eyeballs. Big PC/IT companies such as Intel and AMD are again pushing into the digital living room with their new initiatives. Big telcos such as SBC and Verizon also have a strong presence with their U-Verse, HomeZone, and Fios services.
Prior to the show, Business Week featured an excellent article talking about Intel’s new platform strategy, new logo and tagline, and marketing campaign for the ViiV platform. Intel is finally committing serious financial and human resources to its digital home initiatives, in a campaign bigger than that of Centrino/hot spot in the 2002-2003 timeframe. During CES, a big part of Paul Otellini’s keynote is about the ViiV platform. He shared the stage with Chase Carey, the CEO of DirecTV, Michael Dell, and Morgan Freeman. ViiV is not just about chips; it’s also about interoperability and content.  
In China, Intel also has big plans. It is opening 15 stores for consumers to experience ViiV PCs and devices. These stores will be first launched in large cities such as Beijing and Shanghai, with more to come in the near future. More than 20 companies with operations in China will soon begin selling ViiV PCs in the market.
In order to localize its offerings, Intel is planning on using the interoperability guidelines developed in China-“Shanlian”, or IGRS (Intelligent Grouping and Resource Sharing). The IGRS WG was established by Lenovo, TCL, Konka, Hisense and Great Wall and approved by MII Science and Technology Department in July 2003. According to IGRS’ website, the scope of the standard is to allow information devices at enterprises, public, individual and home locations to conform to a set of common resource descriptions and functional service interface standards when interconnecting with each other, enabling them to effectively implement resource sharing and service collaboration, improving the interoperability among devices and enhancing the combined service among different devices. Many of IGRS’ objectives overlap with those of DLNA and some people suspect that it will trigger another episode of China attempting to create a local technology standard to compete with international standards, similar to that of WAPI vs. Wi-Fi. It seems the relationship between IGRS and DLNA is quite complicated. Many of IGRS members, including Lenovo and TCL, are also members of the DLNA. In fact, Lenovo wants to promote cooperation between the two organizations. Lenovo believes that the two are complementary than competitive. This article on China Daily provides more information about IGRS.
Intel is also launching with several important IP content providers such as Shanghai Media Group (SMG) and TianTian Online. The partnership with SMG is especially important. SMG is the second–largest media distributor in China and the first in the country to receive an IPTV and mobile TV operation license. It owns 13 analog television channels, 11 analog radio channels, two newspapers and two magazines, and also produces, licenses and distributes domestic, Korean and Japanese content. SMG also has more than 53 million broadband customers.

Sunday, January 01, 2006

China Sees 3G Licenses in 2006

China sees 3G Licenses in 2006
According to an article written by Jason Dean at the WSJ, China’s government is finally near a decision to issue licenses for 3G mobile services. Now it seems possible that Chinese people will have access to such services in 2006.

At a government meeting yesterday, China's top telecommunications regulator made his most definitive public statements yet on the timetable for licensing third-generation, or 3G, networks. Minister of Information Industry Wang Xudong said China would "finish formulating policies for the development of 3G technology and business" in 2006, according to a report by China's official Xinhua news agency. A ministry official attending the meeting confirmed the comments.

The discussion about China’s 3G license started more than five years ago and it has been pushed back several times due to a couple of factors:
  • uncertain consumer demand;

  • carriers’ need to recoup 2G investments;

  • the delayed launch of 3G services in Europe and the United States (China wants to observe these markets before decides to join); and

  • the long wait for local 3G standard TD-SCDMA to mature and be accepted (I predicted in 2002 that China wouldn’t launch 3G in the next three years and the government wanted to wait for a mature TD-SCDMA standard, supported by vendors and carriers).
China is already the largest wireless market in the world, with more than 380 million subscribers. Launching 3G in China will be a big boon to international network vendors such as Siemens, Nokia, Motorola, Ericsson, Motorola, Nortel, Huawei, and ZTE…
With the 2008 Olympics just around the corner, the government wants to have wide availability of commercial 3G services before then. The carriers also want to monetize the strong demand of Chinese consumers for multimedia mobile services such as music, video, and gaming.

Interesting News Today