TMCnet News

Little Smart to withdraw from Chinese market within 3-yrs
[February 04, 2009]

Little Smart to withdraw from Chinese market within 3-yrs


BEIJING, Feb 04, 2009 (Xinhua via COMTEX) --
Little Smart (personal handphone
system) will withdraw from the Chinese market within three years
because its 1900-1920MHz frequency band has been requested empty by
year-end 2011.
The move is to prevent the frequency band from interfering
with China Mobile Communications Corp.'s (CMCC) TD-SCDMA (TD) system,
whose frequencies range is 1880-1900 MHz.
According to statistics released by the Ministry of Industry
and Information Technology (MIIT), the number of Little Smart users
was 68.931 million by last year's end, down from almost 100 million
during its peak. Still, the move will impact about 70 million users.
Currently, China Unicom (0762.HK; CHU.NYSE) and China Telecom
(0728.HK; CHA.NYSE) are operators of Little Smart's business, and
have promised to stick up for their customers interests by
transferring them to other mobile telecom networks and offering some
preferential services.
The move was considered as another supportive measure taken by
the government for TD development.
Ren Wenjie, researcher with First Capital Securities, thinks
that Little Smart's frequency band may be allocated to TD in the
future. The issuance of the policy and the three-year term are
appropriate considering TD's technological evolution.
Cleaning up Little Smart's frequency range is actually within



the expectation of China's carriers.
Ren said that Little Smart's attraction decreased as the
calling fees of mobile phone continuously lowered, gradually sliding
the market down. As a result, Little Smart became ripe for plucking
from the market.
China Unicom announced on January 23 in consideration of the
consecutive slowdown of Little Smart user numbers and calling volume,
it was conducting impairment tests on relevant business assets. It
was expected that a considerable amount of provisions will be put
towards the impairment of the relevant assets, which might result in
a negative impact on the carrier's profit for 2008.
After the adjustment, CMCC's frequency range advantage will be
more obvious.
MIIT ratified 3G frequency bands for China's three giant
telecom operators right before January 26, China's traditional New
Year. China Unicom and China Telecom each acquired a 30M frequency
range, and CMCC a 35M.

[ Back To TMCnet.com's Homepage ]