China's 3G developments are being hampered by several local issues, including the government's delay in establishing standards, according to Ovum.

A statement released by the analyst firm said that the delay by the Chinese government in announcing industry standards and license details are slowing down investment.

"Without an official signal from the government on when licenses will be issued, how many will be awarded and what standards will be adopted, mobile carriers are taking slow and cautious moves in 3G investment and preparing themselves for the capital expenditure," said Ovum.

Besides license delays, possible favoring of local businesses over foreign ones may also stunt investment in the industry. "The heavy protection of state businesses will continue to make foreign company investment difficult in the 3G era, despite the country's World Trade Organization (WTO) commitment," said Ovum.

In May, the Ministry of Information Industry approved the use of European and American standards, in addition to China's home-grown 3G standard, TD-SCDMA.