China Mobile, the country's largest carrier by users, on Monday denied rumors circulating online that it aims to close its third-generation (3G) base stations as part of a strategic shift from 3G to fourth-generation (4G) services.
A PR officer at China Mobile, who declined to be identified, told the Global Times on Monday that there is no plan at the group level to close down its TD-SCDMA 3G base stations.
In 2009, China Mobile acquired the 3G license based on the TD-SCDMA standard. Its smaller rivals, China Unicom and China Telecom, won 3G licenses based on the WCDMA and CDMA2000 standards, respectively. Those two standards are international, while the TD-SCDMA standard is specific to China.
The Chinese government had hoped China Mobile could drive the development of the domestically developed TD-SCDMA, but the standard has failed to make an impression around the world.
Over the weekend, rumors that claimed China Mobile is closing down its towers in an organized fashion began to circulate online.
What was purported to be a leaked PowerPoint graphic was posted online, showing an action plan by what seemed to be a China Mobile subsidiary to close down before April 30 base stations with average daily Web traffic of less than 100 megabytes.
A report by news portal caixin.com on Sunday said that even as China Mobile denied having any such plan at the group level, the company's subsidiaries in various provinces were "sorting out" their TD-SCDMA base stations. The portal cited multiple sources familiar with the matter.
These subsidiaries plan to upgrade their base stations from TD-SCDMA to TD-LTE, a 4G standard China Mobile is promoting, as soon as possible and close down those unfit for an upgrade, the caixin report said. The move is aimed at freeing up bandwidth for TD-LTE services for a more efficient network, according to the caixin report.
Some media reports said the closure could lead to the loss of hundreds of billions of yuan in infrastructure investment.
Fu Liang, an independent industry watcher, said those estimates are exaggerated.
"There are still around 20 percent of the users subscribing to the 3G service offered by China Mobile, so China Mobile cannot close down its 3G base stations outright," said Fu Liang.
"However, carriers are hoping wireless users will leapfrog from 3G to 4G services in a short time span, and this will cause some losses due to asset depreciation," Fu told the Global Times on Monday.
China saw 289 million new users join its 4G network in 2015, bringing the total to 386 million, the Ministry of Industry and Information Technology (MIIT) said in January. The number of China Mobile 4G users stood at 312 million by the end of 2015.