China Mobile could be looking to buy US carrier
China Mobile, the world's largest mobile carrier in terms of subscribers, could be looking to acquire a U.S.-based carrier to gain a foothold in the lucrative U.S. market.
Chairman Xi Guohua has expressed interest in exploring expansion opportunities in North America and Europe, notes Erik Heinrich in a Fortune article.
But to get a foothold in any of those markets, including the U.S., China Mobile would need to acquire an existing carrier, buy spectrum or enter the market as a mobile virtual network operator (MVNO), Julian Watson, an analyst at IHS Technology, tells Fortune. An MVNO buys wholesale access to network service from an existing carrier and resells service to retail customers.
One U.S. carrier that could be up for grabs is T-Mobile US. Japan's Softbank is bidding for T-Mobile, but since Softbank has already acquired Sprint, such an acquisition could face opposition from U.S. regulators. That could open the door for China Mobile, Heinrich notes.
Another option would be for China Mobile to participate--either alone or with a U.S. partner--in the 600 MHz spectrum auction the Federal Communications Commission has set for 2015. China Mobile recently launched its 4G LTE network that uses the TD-LTE standard, which works with the U.S. FD-LTE standard.
"The benefit of TD-LTE is to complement FD-LTE to increase capacity in peak hours and in congested cells," Sandy Shen, research director in Gartner's Shanghai office, tells Fortune. Shen notes that China Mobile could also set up an MVNO arrangement with a U.S. carrier and serve consumers and business that have a connection to China.
Whichever approach China Mobile chooses, its presence in the U.S. market will be felt by established players Verizon and AT&T.
- check out the Forbes article
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