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China awards homegrown 4G licences

TAIPEI, Taiwan -- The telecom and internet segments on Thursday bucked the downward trend of the broader market on expectations that NT$2.4 trillion business will be generated in three years by newly-awarded 4G licenses in China.

The Ministry of Industry and Information Technology of China (MIIT), the mainland's top telecom watchdog, on Wednesday night announced that the first 4G licenses were granted by the authority to China Mobile, China Unicom Hong Kong and China Telecom, the country's three main telecoms companies.

According to MIIT's official statement, the new licenses are for the Time-Division Long-term Evolution (TD-LTE) networks, a homegrown standard rather than its more popular international rival Frequency Division Duplexing-Long Term Evolution (FDD-LTE).

TD-LTE is jointly defined by China-based Datang Telecom, Huawei, ZTE and China Mobile, as well as Nokia Siemens Networks, Alcatel Shanghai Bell and others.

The positive news gave telecoms and internet shares a shot in the arm in Taiwan's share market yesterday.

Shares of wireless network module provider Azurewave Technology (海華), a subsidiary of Asustek (華碩電腦) subsidiary, rose 2.55 percent to NT16.61

Hon Hai Precision Industry (鴻海精密)-invested optical cable provider Tai Tung Communication (台通光電) jumped 2.33 percent to NT$35.2 while cable customer-premises equipment maker Hitron (仲琦) soared 2.6 percent to NT$15.8.

China Mobile antenna supplier M.gear (譁裕) and optical fiber provider LuxNet (華星光通) yesterday surged respectively by nearly the daily maximum of 7 percent to NT$18.15 and NT$32.7.

The official sign-off for 4G TD-LTE licenses in the world's largest telecom market means a windfall for overseas technology companies, including handheld device makers such as Apple and equipment manufacturers such as Cisco.

Other Taiwan-based companies such as Gemtek (正文科技) and Quanta Computer (廣達電腦) have been incorporated into China Mobile's supply chain and are expected to reap China's 4G windfall.

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