Chinese telecom operators are increasingly tilting toward a homegrown audio/video coding standard for broadcasting, which domestic developers have had a tough time selling to the industry.

Wei Leping, chief engineer of China Telecom Corp, said fixed-line telephone carriers plan to test the domestically developed AVS (audio video coding standard), which competes with H.264, an international standard backed by many foreign companies.

"H.264 will be employed (by China Telecom) as it is the only audio/video coding standard accepted by the telecom, cable TV and media industries," he told the Broadband World Forum Asia 2007, which started on Tuesday and closed tomorrow. "And we'll continue to test AVS."

Wei's remarks might mark a departure from China Telecom's firm backing for H.264, which has been adopted in its networks for IPTV (Internet Protocol Television).

Related readings:  Regulator urged to decontrol IPTV AVS standard may save US$300m in royalty fees

Industry insiders said China Telecom could start the AVS trial as soon as this month in Shanghai, where it operates the country's largest commercial IPTV network. China Telecom has 210,000 IPTV subscribers, with 70 percent of them in Shanghai.

China Netcom , the smaller rival of China Telecom, has been running IPTV trials based on both AVS and H.264 but has indicated it would fully switch to AVS.

At the Broadband World Forum Asia 2007, China Netcom Chief Technology Officer Teng Yong said the firm has built an AVS-based IPTV trial network in Dalian, a city in Northeast China's Liaoning Province. The network could accommodate 35 million subscribers, he said.

A recently released mobile TV specification in China, known as CMMB, also uses AVS as its coding standard.

AVS is part of an effort by the government and domestic companies to push for home-grown technology standards in a number of promising industries such as the mobile phone and wireless sectors.

The International Telecommunications Union is considering AVS as part of a global IPTV standard, according to the AVS Working Group of China. The working group in April said tests by Netcom in Dalian have showed AVS outperformed H.264.

AVS backers say the Chinese standard could save domestic companies a lot in royalties.

An industry group formed by MPEG4/H.264 developers charge not only manufacturers but also content developers and operators. It is estimated China will pay 20 billion to 50 billion yuan each year if H.264 is adopted.

AVS patent holders, on the other hand, charge only 1 yuan for every unit of hardware. But H.264 is more mature with wider industry support.

Which standard to choose is now one of the biggest challenges facing China Telecom, Wei said at the broadband world forum, a major industry event being held on the mainland for the first time.

Previous events were held in South Korea, Japan and Hong Kong. The forum in Beijing attracted 3,500 industry professionals from the leading industry players, associations and government organizations, said Chicago-based International Engineering Consortium, which is co-hosting the event with China Netcom.