Company also among the top three vendors in the WCDMA sector

24 March 2009, Shenzhen, China – iSuppli, a well-known international research firm recently released an industry report entitled ‘China Market Watch: China's Mobile infrastructure Equipment Market in 2008', revealing the latest market situation of the mobile wireless equipment sector since the restructuring of China's telecom industry last year. The report highlighted the significant achievements attained by local 3G equipment vendors in providing China, the world's largest 3G market, with high quality 3G devices. 

The iSuppli report predicts that in line with the current global financial crisis, telecom equipment manufacturers will seek ways for more cost-effective products and solutions, which will lead to an intense price competition in China's 3G market. Despite this challenge, local vendors were still able to maintain their competitive advantages, even gaining higher market share in today's 3G sector over the previous the 2G industry, the report revealed.

Interestingly, the report disclosed that the top three telecom operators in China, due to the current financial crunch, had slashed their investment budgets in enhancing their respective networks. China Telecom had invested US$800 million, which is US$700 less than its initial budget, to expand its current network scale to 133,000 Base Transceiver Stations (BTS) covering 342 cities. During the second phase of its TD network construction, China Mobile also spent US$800 million in constructing 25,000 new base stations in 28 cities, US$150 million lower than its initial budget. China Unicom has also completed the construction of 77,000 BTS in 55 cities during the first phase of its UMTS construction.

In terms of WCDMA market, China Unicom has announced it will invest about 30 billion RMB during the first phase of its strategy to provide commercial 3G services to 55 cities and municipalities, including well-developed metropolis in China by mid this year. Under the plan, China Unicom will expand its 3G services scope to 282 cities by yearend.

After participating in a series of competitive tender bids, local 3G vendors dominated China's 3G market. ZTE topped the CDMA 2000 and TD-SCDMA BTS bids, capturing 28% and 34% of the total projects respectively, while securing the third position in UMTS sector with 21% market share. In line with these three network projects, about 190,000 ZTE TRXs were deployed, sufficient enough to rank the company as the No.1 largest 3G equipment vendor in China.  

iSuppli predicts ZTE to continue taking a leading position in the TD-SCDMA sector with its state-of-the-art technology and continuous R&D efforts to help rapidly drive the development of TD-SCDMA in China. The company was previously selected by China Mobile to help construct TD-SCDMA network and supply the industry's first-TD-SCDMA TV handsets in several major Chinese cities during the Beijing 2008 Olympic Games.

Meanwhile, ZTE has been actively promoting the adoption of UMTS for the 3G market. In February 2009, it announced a partnership with Hong Kong's number one mobile operator CSL New World Mobility (CSLNWM) to build the world’s first SDR (Software Defined Radio) based HSPA+ network in Hong Kong, - the first large-scale all-IP network with such technology in the world. Under the agreement, ZTE will help upgrade CSLNWM’s existing infrastructure with a fully integrated 2G/3G all-IP SDR-based network. The two companies successfully completed testing of the HSPA+ network capability last month, delivering HSPA+ (64QAM) services which can provide up to 21Mbps download speed. ZTE's SDR technology enables operators to upgrade to next-generation networks, including HSPA+, MIMO and LTE.

Recently, ZTE has announced another sterling 2008 annual earnings result. The company recorded a 27.37% revenue growth despite of the bad global economic crunch, making it the clear leader of China's 3G industry. It has 30% share of the of the total 3G equipment market. In addition, ZTE has entered into a strategic partnership with China Development Bank by signing a 'Development of Financial Cooperation Agreement'. Under the 5-year cooperation framework agreement, China Development Bank will provide ZTE a US$15 billion credit line to finance the company’s 3G projects and international operations. The partnership further strengthens the solid relationship the two organizations have previously developed.