China’s phone standard fails to win gold
By Mure Dickie
Published: August 11 2008 20:07 | Last updated: August 11 2008 20:07
ft.com
As the world’s athletes strive for gold and glory in Beijing this month, China’s dominant mobile phone operator is engaged in a contest for even greater stakes: the battle to establish the commercial credibility of the nation’s new mobile phone standard.
China Mobile, an official Olympic sponsor, is using the Games to tout a new network based on the government-backed TD-SCDMA standard as the long-awaited arrival of “third-generation” mobile services in the world’s biggest wireless market by subscribers.
Success for TD-SCDMA would establish China as a power to be reckoned with in global telecoms standard-setting and pave the way for Chinese companies to sell equipment based on the standard overseas. Failure, however, would be a heavy blow to Beijing technology mandarins who have backed TD-SCDMA with state cash and regulatory favour.
So when three local employees of the Financial Times Beijing bureau won the chance to join a large-scale TD-SCDMA consumer service trial last week, we seized the chance to put the nascent network and some locally produced handsets through their paces. All three were keen to become early adopters of the latest 3G wireless technology and to try out long-discussed services such as high-speed internet access, videophone calls and mobile TV broadcasts of the action at Beijing’s glittering new Olympic stadia.
Unfortunately, after three days of intensive use, our FT colleagues’ verdicts on the TD-SCDMA service were damning. “It’s too terrible,” says news assistant Kerry Ma, who was using a Panda TD988 made by Nanjing Panda, with a recommended retail price of Rmb2,780 (£211)($405)(€270). “It sucks,” says counterpart Joyce Du, who has a Lenovo TD800 (made by the former handset arm of Lenovo at Rmb1,800). “Too awful,” agrees office manager Ginny Ge, who has been trying out a Postcom n268 (made by Guangzhou New Postcom Equipment at Rmb1,800).
Such scathing comments are particularly striking given that the three testers not only received free handsets as part of the trial – which China Mobile is using to get feedback from users – but also Rmb800 a month in free calling credit.
For Ms Ma, free calls were quickly outweighed by being repeatedly embarrassed in front of peers by her high-tech handset: “I told my friends I have a 3G phone and then I wanted to show it off to them – each time I ended up being laughed at because it didn’t work.”
It would be wrong to read too much into a single technology test involving only three people. Telecoms networks always need time to achieve comprehensive coverage and reliable service and even the best equipment vendors sometimes ship duff handsets.
Still, Duncan Clark, managing director of telecoms consultancy BDA, says that despite the insistence of government officials that the TD-SCDMA technology is mature, many early users are dissatisfied with the network and the mobile phone models now available.
Mr Clark says the poor quality of the handsets is a particular problem and one that the TD-SCDMA technology community, led by state-owned equipment vendor Datang Telecom, looks ill-placed to resolve.
Without a dramatic turnaround, TD-SCDMA looks doomed as a competitive technology for 3G handsets, although it may still be possible to build a market for data cards that connect laptops to the internet. “The emperor has no clothes – and not only that, he’s not particularly good looking,” Mr Clark says. “It’s becoming pretty obvious that TD isn’t going to fly except perhaps as a niche service for data cards.”
That would be good news for vendors who have focused on the much more widely used European WCDMA 3G standard or its US- favoured CDMA2000 rival. Beijing originally chose to develop TD-SCDMA, an internationally recognised standard, in part to reduce the dependence of local telecoms equipment companies on expensive foreign technology.
And Chinese regulators have delayed issuing 3G licences for years in order to prevent the rival standards dominating the local market.
But some analysts are still upbeat on TD-SCDMA, which stands for Time Division Synchronous Code Division Multiple Access, and which backers say allows more efficient use of radio bandwidth than WCDMA or CDMA2000.
Wang Yumin, of the government’s China Academy of Telecommunication Research, says that while TD-SCDMA trails years behind its rival standards, it is making progress.
He estimates that by this month China Mobile has between 80,000 and 100,000 TD-SCDMA users, up from 52,000 in early July. “China Mobile has done a pretty good job with TD-SCDMA in such a short period,” Mr Wang says.
Yet our FT testers make clear that much remains to be done to improve the TD-SCDMA service. Ms Du, a downtown dweller, was usually able to make voice calls from her phone, but Ms Ma and Ms Ge, who live just outside the city centre, were often unable to get a connection.
Even when there was a network signal, 3G services did not work as advertised.
When Ms Du tried to watch an Olympic gymnastics mobile broadcast, the picture was blurred and there were image overlaps that took several seconds to resolve. “It looked like the special effects from a movie,” she says.
Ms Ma tried to compare live broadcasts using her old-fashioned 2G China Mobile phone and her new Panda handset. “I could watch it on my 2G phone,” she says. “But I never got the 3G one to work.”
Internet access was also patchy and slow, but among the biggest disappointments was the videophone function. Though early mutual calls within the office caused much hilarity, few video calls connected once separated across the city and those that did were often cut off.
The price of being early adopters was that most of the time they could only video-call each other. Ms Du did find an old acquaintance who also has a TD-SCDMA phone – but ended up spending too much time on the videophone with him. “I didn’t really want to see him so much,” she says.
Still, Ms Du and Ms Ge both say video-calling is something they would try again.
The fashion-conscious Ms Ge was less willing to forgive the styling of her Postcom handset. “I think my phone is just too ugly,” she complains. “It looks like the kind of phone used by a village cadre.”
All three complain that their phones sometimes turned themselves off. Indeed, all agreed they would like to be rid of them but that is not an option since under the trial contract they would have to pay China Mobile back.
“It has become a burden,” says Ms Du. “You can’t use it, but you can’t lose it.”
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China Mobile likely to remain undaunted in its long-term aims
Visitors arriving in Beijing late last month were greeted at the downtown terminal of the airport express by posters offering the chance to rent a 3G TD-SCDMA phone.
But one such visitor who called the number on the poster was told by the China Mobile service desk he was connected to that no such rental service existed.
It was a rare slip by China Mobile, which appeared to be making the elementary business mistake of setting its customers up for disappointment.
Disappointment is also rife among those users who have managed to get hold of a TD-SCDMA phone but are now struggling to access long-touted 3G services such as live sports broadcasts.
China Mobile declines to comment on its TD-SCDMA business, but some analysts think the operator is being smarter than it looks. It is no secret that the company is only offering TD-SCDMA because it has been forced to by its government masters.
Making a show of promoting the standard will win it credit among officials, while leaving open the possibility to move on to newer technologies if it fails to take off.
"They would rather have TD alive than dead, but they would rather have it sickly than thriving," says Duncan Clark, of consultancy BDA.
TDSCDMA is DOA - Qgent |
