China Mobile Has 15 Phones for 4G as Apple Talks Continue

China Mobile Ltd. (941), the world’s largest phone company by users, has 15 handsets ready to be used on its fourth-generation mobile network as it continues talks with Apple Inc. (AAPL) for iPhone cooperation.

More than 100 devices are in development for the carrier’s TD-LTE network, Chief Executive Officer Li Yue said at a press conference in Hong Kong yesterday. Li, whose company doesn’t offer the iPhone, didn’t identify the vendors of the 4G handsets.

Apple CEO Tim Cook met with China Mobile Chairman Xi Guohua in Beijing last month, his second visit this year, as the company dropped to seventh in the nation’s smartphone market in the June quarter. While each of the top five vendors has a distribution agreement with China Mobile, Apple is limited to the nation’s second- and third-largest carriers.

“The discussions with Apple are still ongoing,” Xi said at the press conference. “Most of the discussion revolves around commercial details and technology issues.”

China Mobile’s 740 million wireless users account for 63 percent of the market. Cupertino, California-based Apple has agreements in place with China Unicom (Hong Kong) Ltd. (762), the nation’s second-largest carrier, as well as third-ranked China Telecom Corp.

Suwon, South Korea-based Samsung Electronics Co. (005930) led China’s smartphone market with its 18 percent share in the second quarter, followed by Lenovo Group Ltd. (992) with 12 percent, researcher Canalys said this month. The rest of the top five were local vendors that have distribution agreements with China Mobile: China Wireless Technologies Ltd.’s Coolpad; ZTE Corp; and Huawei Technologies Co.

Sliding Share

Apple’s market share halved to 5 percent in the second quarter, its lowest since the fourth quarter of 2010, according to Canalys.

China Mobile runs a third-generation network standard called TD-SCDMA, which Apple so far hasn’t agreed to support. The carrier is preparing for commercialization of its fourth-generation network using the international TD-LTE standard.

The carrier yesterday said it spent 14.2 billion yuan ($2.3 billion) on subsidies in the first half of this year to attract users to its 3G network.

China Mobile’s net income in the second quarter rose 2.5 percent to 35.2 billion yuan as costs to add new subscribers to restrained growth, according to figures derived from first-half results released yesterday.

Carolyn Wu, a Beijing-based Apple spokeswoman, didn’t return phone calls for comment on Xi’s remarks.

To contact Bloomberg News staff for this story: Edmond Lococo in Beijing at elococo@bloomberg.net; Lulu Yilun Chen in Hong Kong at ychen447@bloomberg.net

To contact the editor responsible for this story: Michael Tighe at mtighe4@bloomberg.net

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