Finally there’s news on the choice of standard China is targeting to use and implement before the Olympics in Bejing 2008. We’ve been waiting for this.

And not surprisingly the Chinese answer is typical Chinese. Instead of choosing one over the other they choose to adopt both the western WCDMA/CDMA2000 technologies as well as their own homegrown TD-SCDMA (Time Division-Synchronous Code Division Multiple Access) for the nation’s third-generation mobile-phone networks, as Wang Lijian, a Beijing- based spokesman at the Ministry of Information Industry, declared 16th May.

“China needs to use WCDMA and CDMA if it wants to fully develop the potential of its mobile market, but the government’s main focus will continue to be on the domestic TD-SCDMA,” said Tiffany Feng, an analyst at Guotai Junan Securities Ltd. in Hong Kong. “The readiness of TD-SCDMA will still be the biggest factor in deciding when 3G services start in China.”

“WCDMA is the most widely accepted global standard and China can’t afford not to have it,” said Marvin Lo, an analyst at Daiwa Institute of Research in Hong Kong. “The clock is ticking and China is getting closer to issuing 3G licenses.”

Interestingly enough at the same time Chinese People’s Daily report

Some industry observers say this is as a sign Unicom might sell its CDMA networks to fixed-line carrier China Telecom and focus solely on GSM services. China Telecom Chairman Wang Xiaochu has publicly expressed interest in buying one of Unicom’s two cellular networks. Unicom denies it is in talks to sell to the operator.

Rumors suggest Unicom will scale down or cease investment in CDMA networks this year. Li denied the reports, saying Unicom will continue its investment, but would not elaborate.

Hmmm. CDMA is political and so is China Telecom.

Over at gigaom.com Om Malik posts “China throws foreign 3G a bone” and calls this “a hollow, meaningless exercise”:

For instance, the specifications for the home grown 3G standard, TD-SCDMA, were issued in January 2006. Secondly, the specifications don’t necessarily mean licenses, which are yet to be issued. In other words, this is a hollow, meaningless exercise, which doesn’t hide the fact that Chinese government, does indeed prefer home grown telecom equipment makers - Huawei and ZTE
Corp.

One commentator points out it’s “ good strategic move by Chinese govt”:

It’s but natural for Chinese Govt to back Chinese companies. IMO, the move is more prompted by non-readiness of TD-SCDMA and realization that unless 3G is rolled out soon, govt will miss the bus for Beijing Olympics - which is seen as major revenue source by all mobile companies in China. So this is indeed a reluctant go-ahead. I wouldn’t be surprised to see curbs on WCDMA / CDMA-2000 (by way of lower spectrum allocations) once TD-SCDMA is mature enough.

The cost difference between WCDMA and CDMA2000 handsets remains quite large. Currently, entry-level CDMA2000 handsets are $100-$200 less expensive than low-end WCDMA handsets. This difference, as well as the number of models and suppliers at these price points, represents a significant competitive advantage for CDMA2000 operators around the globe.

It still remains to see when TD-SCDMA is entering the stage and which advantages it will bring to the table. Judging from Huawei’s and ZTE’s development and growing R&D strength it could mean a major technological and economical improvement to today’s existing standards.