Unicom to carry out 3rd CDMA bid
17/7/2003 15:03
China United Communications Co., the country's second largest mobile
telecom operator, will invite telecom equipment suppliers from home and abroad
to its third public bid for the CDMA project half-year ahead of its schedule,
its general manager of marketing department, confirmed last week.
The bid,
expected to total 10 billion yuan (US$1.2 billion), is for the third-phase
construction of the CDMA network and was planned around the end of this year.
It's expected to be the largest purchase deal this year in China's telecom
sector.
At the previous two bids, China Unicom signed deals reaching 21
billion yuan and 16 billion yuan respectively.
In the following 10 years, the
market value of China Unicom's CDMA sector is expected to reach 500 million
yuan, with 100 billion yuan to be used for purchase, according to market
analysts.
For the third-phase construction, investment in the first stage in
Beijing alone will reach 2 billion yuan, according to Jiang Peihua, general
manager of China Unicom's Beijing branch.
At this stage, it aims to expand
its users to 800,000-12 million within the year and enlarge the coverage area of
the CDMA network from the existing 90 percent to 95 percent of the downtown
densely polluted area.
At the second stage, the company plans to cover its
CDMA network to 1.000 office buildings in the capital and parts of the subway.
Investment for this stage is still not clear.
To finance for the huge
purchase deal, China Unicom's Hong Kong-listed arm China Unicom Ltd reportedly
will borrow HK$5.5-7.8 billion (US$705 million to US$1 billion) banking loans
and its domestically traded unit on the A-share market is planning to issue
10-billion-yuan corporate bonds.
The huge deal, attracting telecom equipment
suppliers from across the world, will intensify the already fierce competition
in the country's telecom equipment industry, market analysts said.
And
domestic suppliers will feel the pinch from overseas peers as nearly all of the
Chinese firms, except ZTE Corp, lacks the independent research and development
capability in CDMA. They are handling CDMA technology with overseas
partners.
In China Unicom's previous second bid of last year, ZTE won the bid
for 15 percent of the total deal, while the rest was shared by overseas
suppliers such as Motorola and Ericsson.
ZTE seems confident about this bid.
According to Li Shuo with marketing section of Beijing Unicom, the deal they win
this time will definitely surpass the previous event.
So far, China Unicom
has confirmed Motorola and Ericsson have won deals of US$80 million and US$57
million respectively at the third bid for the networks in Jiangsu and Liaoning
provinces.
Jane Chen / Shanghai Daily news
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