China Telecom rolls out 4G network

It becomes the second Chinese operator to offer the new service

China Telecom Corp Ltd, the third-largest telecom carrier of the country, officially began the commercial rollout of its fourth-generation mobile network in the domestic market on Friday, competing with its leading rival China Mobile Ltd in the early stages of a new business sector.

China Telecom leaped ahead of China Unicom (Hong Kong) Ltd to become the nation's second telecom operator to offer 4G services. It plans to start 4G businesses in close to 100 cities across the country but only for wireless network cards rather than handsets.

The rate standards, which are in line with those of China Mobile unveiled a month ago, provide users with seven different pricing plans from 70 yuan ($11.54) for 1 gigabyte of data traffic per month to 280 yuan for 10 GB of data volume every month.

China Telecom said all 4G data cards it is scheduled to promote in the coming days support the home-grown Time Division-Long Term Evolution (TD-LTE) 4G technology.

After the Chinese government issued 4G licenses to telecom carriers on Dec 4, 2013, industry analysts expected China to quickly emerge as the world's biggest 4G market with an estimated 4G service subscriber base of 440 million by 2017. China Telecom's participation in the 4G race will stir the current market and pose a challenge to China Mobile, they said.

China Telecom's shares traded on the Hong Kong stock exchange fell by 1.1 percent to close at HK$3.58 ($0.46) per share on Friday.

China Mobile, the biggest Chinese telecom operator with a subscriber base of 760 million, said last December that it aims to offer 4G services in 340 cities in the country by year-end. The carrier took aggressive moves to show its ambition to gain ground in the 4G battle and lead the market.

However, Huang Meng, a telecom analyst with Beijing-based investment company Eagle Stone Investment, said smaller carriers such as China Telecom still hold advantages in battling China Mobile on the 4G stage.

"To win in the 4G market, you need a sound network but also you need to be capable of responding to the market swiftly and of designing good packages for customers," Huang said. Because China Telecom exercised its marketing capability fully during the 3G era, leaving China Mobile somewhat behind, China Telecom may make good use of its experience and achieve a good share in the 4G era, he pointed out.

Xiang Ligang, a Beijing-based telecom expert, said China Telecom's move was more a gesture for testing the water than seriously taking market share from China Mobile. "China Telecom's contract plans ask for similar prices to those of China Mobile, so I don't think people would regard China Telecom as a first choice," said Xiang.

China Mobile's spokesman declined to comment on Friday.

Liao Hongxiang, an official with China Telecom's public relations department, said China Telecom launched data card products first rather than smartphones because they are more mature products. "For example, people traveling on business with laptops have a bigger need for high-speed 4G services," Liao said.

China Telecom's 4G data cards will hit the market on Feb 21. Liao did not unveil a specific date for the company to launch 4G smartphones and voice packages.

Huang Yufan contributed to this story