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The Chinese government's reshuffling of the country's wireless carriers will make the nation's telecom industry as competitive as the U.S., and a shift to 3G wireless technology will greatly benefit


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, analysts say.

Over the weekend, Chinese officials announced a plan to merge six state-owned phone providers into three in a move designed to offer more competition for

China Mobile

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, which has the largest subscriber count in the world with nearly 400 million.

Three 3G spectrum licenses will be granted to the merged companies once the restructuring is completed: wideband code division multiple access (WCDMA), time division synchronous code division multiple access (TD-SCDMA), and standard CDMA.

The Chinese government is pushing for

China Telecom

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to acquire CDMA licenses from

China Unicom

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, which will affect roughly 43 million subscribers. China Unicom would then be encouraged to merge with

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China Netcom

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, which would build out a 3G network based on WCDMA technology. China Mobile, meanwhile, would be committed to operating a TD-SCDMA network.

American Technology Research analyst Mark McKechnie said he expects China Mobile to face considerable competition from China Telecom if the restructuring goes as Chinese officials plan, and that China Telecom would step up its efforts to upgrade its CDMA network to EV-DO.

This shift, McKechnie says, would create a race in the way


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evolution of its wireless network to EV-DO technology has forced followers


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Deutsche Telekom's

( DT) T-Mobile to move quickly in order to catch up.

"This will in effect make China more like the U.S. market," said McKechnie in a research note. "In China, we will now have China Telecom taking the role of the 'rabbit' pushing its EV-DO network and forcing new followers China Unicom and China Mobile to move on WCDMA."

At the end of the day, McKechnie says, China as a whole offers a total of 619 million subscribers that will need to be converted to different cellular standards developed by Qualcomm, providing the company with a giant opportunity. McKechnie said he expects Qualcomm to receive a 2% royalty rate from patents it owns for CDMA.

JPMorgan Chase analyst Ehud Gelblum agrees that the benefit to Qualcomm would come in the form of a stronger CDMA carrier in China, as well as the quick conversion of nearly a third of China Telecom's 58 million personal access system subscribers to the CDMA network.

"Qualcomm would also benefit from royalties on the WCDMA devices sold in China with the commercial launch of WCDMA in China," Gelblum writes in a note. "We continue to estimate that WCDMA handset shipments in China for 2009 total 35 million."

As analysts do not expect the delivery of 3G licenses to come until the end of the year or early 2009, they expect the next catalyst for Qualcomm to arrive in July when it squares off in a Delaware court with rival


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over a patent dispute for wireless technology and related royalty fees.

In March, Qualcomm was dealt a significant legal blow after a British court ruled against the company in its patent lawsuit vs. Nokia. A U.K. High Court judge said Nokia didn't infringe on two patents related to Global System for Mobile Communications, or GSM, that Qualcomm holds.

Previously, Qualcomm had tried to bring an injunction against Nokia that would keep it from using the GSM technology. As part of that ruling, Nokia does not need to compensate Qualcomm for these patents.