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China Mobile's spending on the network will bloat to about 24 billion yuan after spending 7 billion yuan on network equipment, 12 billion yuan on infrastructure, and more than 4 billion yuan on handsets, Chen said. China Communications Services Corp, the engineering unit of China Telecom Corp, may get contracts for construction, he said.

State-owned China Mobile Communications, which controls Hong Kong-listed China Mobile Ltd., plans to set up a new subsidiary to run the 3G networks, Xinhua news agency reported on April 7, citing an unidentified industry person. The new unit will take charge of the construction and deployment of the TD-SCDMA networks, the report said.

The TD-SCDMA Forum was formed in December 2000 by eight companies to promote and develop the use of the technology.

Members include China Mobile, China United Telecommunications Corp, China Telecommunications Corp, Datang, Huawei Technologies Co, Motorola Inc, Nortel Networks Corp and Siemens AG.

Regulators have delayed the high-speed services, which allow faster Web browsing and downloads, to give Chinese companies such as ZTE and Huawei Technologies Co time to develop their TD-SCDMA equipment. Chinese carriers may buy 205 billion yuan of 3G equipment, according to government-backed industry group China Mobile Communications Association.

China Mobile has submitted the list of companies to the National Development and Reform Commission, the nation's top economic planning agency, for approval, Chen said. The operator may announce the contracts next week, Chen said.

Sales of TD-SCDMA equipment may contribute 2.4 billion yuan in revenue to ZTE's 2007 earnings, UBS AG analyst George Chu wrote in a February report.

China added 6.5 million mobile phone users in February for a total of 473.9 million, according to ministry figures. The nation added 67.7 million wireless users last year, more than the population of France.

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