Rumors on the Chinese net (examples here and here) are implying that KongZhong is involved in dealings to profit off unused TD-SCDMA credit.
According to these reports KongZhong is buying the remaining value from expiring trial TD-SCDMA accounts on a grand scale. These accounts were given free to users of China Mobile's newly launched TD-SCDMA commercial trials and were usually valued at RMB 800.
KongZhong is rumored to use the remaining balance in each account to purchase its own WVAS (wireless value-added services) products through China Mobile. The rumors state that KongZhong has spent millions of RMB buying these expiring accounts; the following diagram provides a simplified explanation of how this scheme works.
These type of practices are not uncommon in China and Chinese service providers have long been criticised for purchasing their own products to improve their listings on China Mobile's portal, as an example. In most cases it was China Mobile itself that policed such activities and took active measures to prevent these type of infringements.
It's easy enough to see the benefits for both sides in this scheme: trial users get some cash for an account they haven't been using, and KongZhong makes a quick buck with little effort.
For China Mobile, though, such a scheme would have cost the company millions, with the only benefit being to provide "evidence" of the popularity of its 3G services. But even with Chinese consumers showing little interest in TD-SCDMA so far, it still seems a stretch for China Mobile to get involved in such a plan. As for the many TD-SCDMA enthusiaists in China, surely they know that the only greater challenge than the technology is the image. And regardless of who was involved or benefited, these revelations can only make it harder to convince a critical mass of users, vendors, and regulators to give the not-yet-mature technology a try.
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