China's ZTE to launch TD-LTE phone this year

SHANGHAI, CHINA: ZTE Corp, the world's fourth-largest handset vendor, plans to launch this year its first smartphone based on TD-LTE technology and is talking to Japan's Softbank Corp for a possible order, a senior executive said on Wednesday.

TD-LTE is one of the two key types of 4G LTE (long term evolution) technologies which have been adopted by global carriers - the time division (TD) variant is being adopted by China Mobile in its trials, while FDD (frequency division duplex) is used in many US and European networks.

ZTE has already launched and sold FDD-LTE handsets in markets such as the United States, Wang said.

"Now is a very crucial stage for the development of LTE," Scott Wang, vice president of ZTE, told Reuters in an interview on the sidelines of the Mobile Asia Expo conference in Shanghai. "We plan to roll out our TD handsets by the end of this year."

ZTE, which ranks behind Samsung Electronics Co Ltd, Nokia Oyj and Apple Inc, has been trying to produce higher-end smartphones to boost its razor-thin margins, after gaining market share over the past few years by selling low-cost phones.

ZTE, also China's second-largest telecommunications equipment maker, said in April it expected its global smartphone sales to more than double this year from 15 million handsets sold in 2011.

The Shenzhen-based company has been making headway in terms of selling fourth-generation (4G) handsets and telecom equipment globally. But there is still some way to go before 4G technology becomes mainstream, due to higher costs and a lack of compatible handsets on the market.

"The biggest bottleneck is the immature 4G handset market," Wang said.

Hong Kong was the first Asian market to launch an LTE network commercially in November 2010, with several other operators offering 4G services in Japan, South Korea and Singapore thereafter.

During the conference in Wednesday, China Mobile Chairman Xi Guohua said the operator's 4G trials were going smoothly and it was on track to launch 20,000 base stations in 10 Chinese cities this year.

"It is highly possible for us to grow even faster than planned," Xi told the conference.