China Mobile Hong Kong Company Limited will sign a network capacity lease agreement with its parent company China Mobile Communications Corporation to rent the TD-SCDMA network capacity for one year at the price of no more than CNY1 billion.
This agreement can be renewed with both sides' consents, according to a statement issued by China Mobile Hong Kong Company Limited.
Chen Yunhong, an analyst from Sinolink Securities, told local media that the CNY1 billion annual rental cost is more like a symbolic payment. Over the past two years, China Mobile invested about CNY35 billion in the construction of TD-SCDMA networks and the group will invest more in the future.
Commenting on the industry's speculation about the possibility for China Mobile to include the TD-SCDMA assets in its listed assets, Chen says although the TD-SCDMA assets are the only assets that are not included in the group's listed assets, China Mobile may maintain the present status for a period of time, because the TD-SCDMA business is still in its initial development and the number of its users is far from the profitable standard.