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China Unicom to Become World's First Provider for GSM and CDMA
China Unicom has gained approval from the State Council to acquire the country's CDMA operator Great Wall Telecom, an acquisition that will create the world's first telecom service provider who operates both GSM and CDMA networks.
Wang Jianzhou, executive vice-president with China Unicom, said Thursday that the acquisition process is under way and the specific development plan for the CDMA (code division multiple access) network has not yet come out.
"After the merger, we will expand the network capacity in accordance with the practical market demand," said Wang.
Great Wall Telecom, which is currently operated by the military, has been offering trial CDMA network services in Beijing, Shanghai, Guangzhou and Xi'an.
Wang said that China Unicom will establish a subsidiary to fully operate the CDMA network, which will not be a part of the listed China Unicom.
"However, the listing company has the right to acquire the CDMA network from the parent company when the CDMA market is mature," Wang said.
"This way, the potential risks of CDMA construction will not affect the business of listing company."
China Unicom was listed both in New York and Hong Kong in June this year.
The mainstream mobile communication networks in China, operated by China Mobile Communications Corp and China Unicom, are based on the European GSM (global system of mobile communication) systems.
The public has been confused by China Unicom's shifting stance towards CDMA network construction. The CDMA proposal was raised in late 1998 when the State Council authorized the company to construct and operate the CDMA network, the mobile communication system employed in the United States.
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