Huawei, ZTE win bulk of China Mobile’s 4G orders

China Mobile has awarded initial 4G contracts worth around 20 billion yuan ($3.2 billion). with domestic firms securing more than half of the biggest prize in the global telecoms industry this year and foreign firms winning about a third, industry sources said.

The development of a 4G network by the carrier, which with more than 700 million mobile customers is the world's largest by subscribers, is also regarded as key to it clinching an agreement with Apple Inc to carry its blockbuster iPhone.

"This is the tender that global telecom equipment vendors have been vying for this year," said an industry source.

Shenzhen-based Huawei and rival ZTE have obtained about 25 percent each of the total 4G procurement in China Mobile's tender this year, said the sources. European vendors Ericsson, Alcatel-Lucent SA and Nokia Siemens Networks (NSN) have obtained a share of around 10 percent each.

The first wave of 4G investments that began in 2010 in Japan and Korea favored Ericsson and NSN, while the second in the US went largely to Ericsson and Alcatel-Lucent. Huawei won a chunk of Europe's 4G contracts last year.

China Mobile said in an e-mailed statement to Reuters that the tender had indeed begun and the progress had been smooth, with the carrier planning to build 200,000 base stations this year.

So far, China Mobile has only spent around a third of its full-year capital expenditure of 190.2 billion yuan in the first half, with the market expecting spending to speed up once the tender takes place.

The Chinese government is likely to issue licenses later this year, which will help China Mobile compete better with its rivals China Unicom and China Telecom, which have better 3G technologies.

China Mobile is the only Chinese carrier without an iPhone contract, which will be key to lifting the percentage of higher-end users on its network.