China will build a stand-alone national mobile network based on TD-SCDMA, the homegrown standard for 3G wireless telecom services, Xinhua News Agency has reported.

Some industry observers took the announcement to signal that China is preparing to issue one or more 3G licenses in the near future, paving the way for licensees to build networks based on TD-SCDMA, WCDMA and CDMA 2000. The field of licensees is expected to include some or all of China’s four major telecom operators--mobile carriers China Mobile and China Unicom, and fixed-line carriers China Telecom and China Netcom.

As 3G licenses are expected to be awarded by summer this year, the move is anticipated to unleash up to $12 billion in spending as the country sets up the high-speed data networks for the 2008 Olympics in Beijing.

Hoping to get a piece of the action, the world’s leading equipment manufacturers have entered into partnerships to support TD-SCDMA. Major investors include European firms Siemens and Nokia, as well as Motorola, Ericsson, Nortel Networks and Lucent Technologies.

Recently, the Chinese government ordered a stop to building WCDMA networks in the country. Reportedly, WCDMA networks have been built in some 30 cities in the name of experimental 3G networks. In turn, the operators are trying to urge the government to approve the legitimacy of WCDMA.