China Mobile launched a huge tender for LTE equipment based on time division duplex (TD-LTE), sparking a race among domestic and European vendors to grab as big a share of the deal as possible.
According to a report this week in China Daily, the mobile operator posted an online tender on June 21 saying it plans to buy equipment for 207,000 base stations in 31 provinces across China, although no details on the value of the contract were provided.
Reuters previously estimated that the deal could be worth $6.7 billion (€5.1 billion), but Light Reading also noted that other estimates have been as high as $30 billion. Telecom Asia reported that China Mobile plans capital expenditures of around €24 billion this year, of which more than half will flow into TD-LTE investments.
European vendors are keen to win larger shares of the deal than they did in last year's tenders. Ericsson has previously said it was confident it would win a larger slice of the upcoming tender for China Mobile's TD-LTE network, after it gained only an 8 per cent share in the first round of the tender last year.
China Daily noted that foreign equipment vendors gained less than a 30 per cent market share during the first bidding round.
Alcatel-Lucent told China Daily it is "very optimistic" it will achieve a satisfactory result in the third quarter, when China Mobile announces the final bidding results.
"TD-LTE business will be the core foundation for Alcatel Lucent's future development," Yuan Xin, president of Alcatel-Lucent China, told China Daily at a press conference this week.
Nevertheless, Chen Peng, analyst with China Merchants Securities, told the Chinese paper he expected domestic players Huawei and ZTE to gain more than 50 per cent of the deal.
Recent warnings by the European Union that it is ready to investigate China's telecoms giants over alleged state subsidies and dumping have been opposed by Europe's vendors, which fear they would be shut out of the lucrative Chinese market in retaliation. The EU is already engaged in discussions with China over similar claims with regard to solar panels.
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