China Telecom Corporation Ltd. will have to wait for its e-surfing mobile phones to become wireless Wi-Fi terminals based on CDMA networks.

Recently, a source from the Ministry of Industry and Information Technology (MIIT) says there is still no policy relaxation on mobile phones' Wi-Fi function, and nothing hints a Wi-Fi test of CDMA mobile phones. The situation is undoubtedly a threat to China Telecom's efforts to promote Internet mobile phones.

This is my new phone number, which not only identifies a mobile phone, but also is my Internet, IM (Instant Messaging), as well as email accounts. The e-surfing services also have roaming function, which you can fully enjoy, Deng Chao, a famous Chinese Mainland actor, thus describes China Telecom's e-surfing brand on TVs and LCD screens in buildings, which indicates the company's CDMA strategy.

As the word of Internet mobile phone is never heard of, China Telecom notes that the new product will be able to get access to the Internet through high-speed broadband networks anytime anywhere. Surfing on mobile phones will then be faster than browsing through computers.

As to why the CDMA mobile phones have mobile broadband function, the company is said to make full use of its wide Wi-Fi networks in 21 provinces and municipalities around China.

Although there have been rampant talks about the pre-commercial of CDMA mobile phones' Wi-Fi function in the first quarter of 2009, the MIIT has not confirmed any possibilities of such network access test.

Previously, China Telecom required that CDMA mobile phones must have Wi-Fi function. However, according to certain mobile phone producers, the Chinese leading mobile telecom carrier has not mentioned such a thing in customization regulations sent to them.

The situation is somewhat like that in the CMMB (China Mobile Multimedia Broadcasting) industry. The MIIT still forbid testing the CMMB function of mobile phones before issuing network access licenses. But what producers will usually do is to sell mobile phones with CMMB function, while send those without the function for test.

Insiders analyze that the CDMA mobile phones have no Wi-Fi function in a short term, maybe because carriers except Chins Telecom oppose. As the company's orientation for its CDMA business is to serve high- and medium- customers, more Internet phone users will choose CDMA services with Wi-Fi function and preferential service packages.

That will definitely impose threat to China Mobile Ltd. (SEHK: 0941 and NYSE: CHL) and China Unicom (Hong Kong) Ltd. (NYSE: CHU, SEHK: 0762, and SHSE: 600050), whose voice call revenues are withering, because users of such CDMA mobile phones will then be able to make free-of-charge VoIP calls. Thus, a compromised plan may be taken, to enable CDMA mobile phones for Internet browsing, not voice calls.

Source:hexun