China Mobile adjusts TD terminal subsidy strategy

In the case of repeated frustrations with the introduction of the Apple iPhone, China Mobile tried to adjust the TD terminal subsidy strategy to mobilize the TD terminal industrial chain initiative and expand its own 3G user base.

Recently, Li Liyou, chairman and CEO of Spreadtrum, a TD chip maker, disclosed to China Business News in Shenzhen that China Mobile has adjusted its TD terminal subsidy policy, which has reduced the scale of TD terminal procurement by two-thirds, as long as it can qualify for China Mobile's TD terminal. Product libraries can all enjoy preferential policies for TD phone subsidy. "This strategy will accelerate the expansion of TD camp."

Li Liyou also said that 2012 will be the era of TD-SCDMA mobile phone replacement of GSM mobile phones, because the cost difference between TD mobile phones and GSM mobile phones has dropped to less than 2 US dollars, and Spreadtrum introduced TD smart phone solutions, mobile phone costs around 60 US dollars, The market price may be as low as 700 yuan.

In fact, the key to allowing China Mobile to develop the TD industry chain so vigorously is that the 4G technology TD-LTE that China Mobile is developing must be compatible with 3G TD, making TD a threshold for China Mobile. Spreadtrum, on the other hand, hopes to use China Mobile's opportunity to develop TD terminals and bring its GSM mobile phone customers to the TD camp.

Li Liyou said that the growth of TD-SCDMA chip business will be the biggest bright spot for business growth of Spreadtrum next year. Spreadtrum’s second-quarter 2011 financial report showed that Spreadtrum’s revenue in the second quarter was US$160 million, a year-on-year increase of 124.2%, and a net profit of US$32.5 million, a year-on-year increase of 193%. iSuppli data show that Spreadtrum’s share in GSM mobile phone chips has exceeded 30% and is rapidly approaching MTK.

"Now China Mobile's TD terminal terminal collection and marketing scale accounts for less than 30% of total TD terminal sales. As long as the short-listed China Mobile product library, TD cell phone terminals can enjoy TD call subsidy. This change in policy, or greatly mobilized the mobile phone manufacturers Enthusiasm, said Gao Guiming, senior vice president of Guohong Communications.