China would launch a special program to develop the technology for a "next-generation broadband wireless mobile communication network" in 2008, Wang Xudong, the minister of Information Industry, said on Thursday.
The next-generation technology would be in line with developing trends in information technology and would contribute to innovation and Chinese companies' global competitiveness, the minister said.
Additionally, the country would focus on research and development of other key technologies such as those for core electron devices, high-end general chips and ultra-large integrated circuits, he said.
On Wednesday, the State Council (cabinet) approved a plan to develop the next-generation network, which analysts said was related to the third generation (3G) services.
The country is expanding the TD-SCDMA (Time Division Synchronous Code Division Multiple Access) network tests to prepare for 3G services during the Beijing Olympics next year.
The TD-SCDMA is a homegrown 3G technology standard. The other two types of CDMA technologies are the U.S. standard, CDMA 2000, and the European WCDMA.
There was no timetable available yet for the issuance of 3G licenses, since relevant departments were still considering how the services would operate, but analysts said the homegrown standard was most likely to get the first license.
On the news of imminent 3G service, telecom shares surged, with China Unicom up by as much as 8.28 percent to 12.29 yuan (1.66 U.S. dollars) during Thursday's trading.
China has four major telecom operators -- China Telecom, China Netcom, China Mobile and China Unicom -- and each monopolizes one or two services.
In a recent report, China's top economic planner said that the country should reorganize the four operators to require them to offer "full-range" services. This means major communication businesses such as fixed lines, internet access and mobile communication services would no longer be monopolized by one or two operators.
The report said such a reorganization would create a "relatively fair" market environment and benefit consumers.