China Mobile’s 4G Network Good News for Apple, Nokia, Alcatel-Lucent, Ericsson

Telecom & Wireless

Published: August 23, 2013 9:10 am

Last Updated: April 27, 2020 6:52 pm

The world’s largest wireless carrier, China Mobile Ltd. (NYSE: CHL), reportedly has awarded initial contracts for the build-out of China’s first 4G wireless network. This is especially good news for Apple Inc. (NASDAQ: AAPL), which has been trying to reach an agreement with the Chinese carrier to offer the iPhone to China Mobile’s customers.

According to unnamed sources cited by Reuters, Chinese firms Huawei and ZTE each received about 25% of the contracts in the first tender offer. Ericsson (NASDAQ: ERIC), Alcatel-Lucent S.A. (NYSE: ALU) and Nokia Corp.’s (NYSE: NOK) Nokia Siemens Networks (NSN) scored about 10% each of the contracts on offer. The total value of the contracts awarded is reported to be about $3.2 billion.

China Mobile is the only one of the major Chinese wireless carriers that does not yet have a contract to sell the iPhone. Apple has been pushing the company to get its 4G network into service so that Apple can push its iPhone 5 (and maybe the cheaper so-called iPhone 5C that is rumored to be coming next month) into the Chinese market.

The total amount of the initial contracts is not huge, but China Mobile’s capex budget for the year is around $31 billion, according to Reuters, and the company has only spent about a third of it so far this year. Analysts expect China Mobile to beginning spending more heavily now that the 4G build-out is out of the blocks.

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