Three domestic telecommunications suppliers have defeated their overseas rivals in the bid for Internet Protocol Television (IPTV) equipment deals offered by China's two leading telecom operators: China Telecommunications Corp and China Network Communications Group Corp, the Beijing News reported Tuesday.

With IPTV service, users are able to watch TV on their phones.

For China Telecom, Shenzhen-based Huawei Technologies Co Ltd won the deal for a test IPTV network for its Guangdong branch, while ZTE Corporation, China's largest publicly-traded telecom supplier, pocketed the deal for its Jiangsu unit. Nasdaq-listed UTStarcom Inc won the contract to supply Shanghai Telecom.

The Guangdong Telecom deal is for a network for 100,000 users, covering Guangzhou, Shenzhen and other wealthy areas of the Pearl River Delta.  However, industry sources cited by the Beijing-based newspaper indicated Huawei is not the only winner of the bid and will be sharing the deal with other contenders including UTStarcom.

ZTE's deal for Jiangsu Telecom is for China's largest IPTV network, covering the four test cities of Suzhou, Nanjing, Wuxi and Yangzhou and with a capacity of 100,000 users.  In addition to it, ZTE has won an order from China Telecom's Shaanxi Telecom unit.

UTStarcom is the biggest winner of the trio, bringing in deals totaling US$45 million to US$100 million. Besides the deal for Shanghai Telecom, it has won the bid for China Netcom's Harbin branch.

Given the fact that the biggest-ever IPTV deal, for China Netcom's Beijing branch, will not be revealed until next year, industry analysts expect stiffer competition ahead, noting that there are a score of telecom equipment manufacturers competing in the fledgling IPTV field.

Currently, Huawei, ZTE and UTStarcom are dominating and overseas players Alcatel Shanghai Bell and Siemens are performing actively in the sector, they noted.  The five have signed-up to tender for nearly all the IPTV bids, according to specialists with Shanghai Telecom's Technological Research institute, the key test carrier of China Telecom's IPTV networks.

Observing that UTStarcom was displaying the utmost zeal, specialists revealed that the company had participated in tests for half of the IPTV bids, including in Zhejiang, Shanghai, Chengdu, Fuzhou and Shantou.

Alcatel Shanghai Bell and Siemens have won no bids so far, but both are redoubling their efforts. 

Siemens' IPTV standard is still at the test stage and has not been adopted by China's telecom operators for the test networks, the specialists explained.

Meanwhile, telecom operators are speeding-up the building of test IPTV networks, with confidence boosted by the warm market response to mobile TV.

China Telecom plans to expand network-coverage from 17 cities to 23, while China Netcom aims to increase coverage to 20 cities.  China Telecom's IPTV business is called "Bai Shi Tong", or SITV, and China Netcom calls its service "Xin Shi Jie".  The services are provided in alliance with Shanghai Media Group, which holds the country's sole IPTV business license.

Shanghai Dragon, China's only authorized mobile TV service provider, said yesterday it has over 5,000 subscribers for mobile TV services.

(Shanghai Daily November 25, 2005)