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China's Wireless-Infrastructure Equipment Spending Peaks In 2009

EL SEGUNDO, CAChina's massive spending on third-generation (3G) networks by its three mobile carriersChina Telecom, China Unicom, and China Mobilewill cause spending on wirelessinfrastructure equipment in the nation to surge by 27.7 percent. Spending will reach $6.3 billion in 2009, which marks a peak for expenditures according to iSuppli Corp. China's three mobile carriers completed the first phase of their 3G network deployments before August of this year.

The proliferation of CDMA-based 3G services is progressing rapidly. China Telecom's CDMA2000 3G network covers 342 cities and is expected to expand to 500 cities by the end of this year. For its part, China Unicom has conducted two phases of WCDMA network deployment to cover 285 cities. In comparison, the process of commercialization of the alternative TD-SCDMA 3G technology is slower than expected. China Mobile's TD-SCDMA network covered just 38 cities before August. However, an additional deployment is set to expand the service to a total of 238 cities by the end of 2009.

"After a strong increase in purchases of wireless-communications gear in China in 2009, 2010 will bring a 2.4-percent decline to $6.1 billion as China Telecom completes purchasing for its massive rollout of 3G cell-phone base-station transceivers," states Will Kong, Analyst for China Research at iSuppli. "Revenue will continue to decline in the following years as the carriers move beyond the initial deployment stage of their 3G services." The carriers' massive investment in infrastructure will result in the number of 3G subscribers in the nation rising to more than 100 million in 2013, which is up from 338,000 in 2008. For more information, see iSuppli's new report, "China Telecom Market Proves to be Immune from Economic Crisis."

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