BEIJING-Chinese analysts expect the country’s PHS services will increase sharply in the first half of the year because the Ministry of Information Industry (MII) has postponed the issuance of third-generation (3G) licenses.
China’s two major fixed-line carriers, China Telecom and China Netcom, are expected to be granted mobile licenses, but until that happens, their only hope to penetrate the mobile market is to expand their PHS services, called Xiaolintong or Little Smart. Once they get their mobile licenses, they will migrate their PHS customers to 3G systems.
Call charges are lower compared with regular mobile services, and there is no charge for incoming calls. If the caller had to pay for the call, the attractiveness of Xiaolintong would be reduced.
The MII prohibits the launch of Xiaolintong in the larger cities such as Beijing, Shanghai, Tianjin and Guangzhou, but there are more than 10 million subscribers in 300 cities around the country. The number of subscribers is expected to double this year.
UTStarcom, the leading provider of PHS equipment in China, on Thursday signed another expansion contract with Shaanxi China Telecom for US$45 million.
