[photopress:ChinaMobile_1_2.jpeg,full,alignright]China will release a telecommunications industry restructuring plan within the next few months.
Lu Guoying, an analyst at CCID Consulting. said, ‘The restructuring plan is very likely to be released after the National People’s Congress in March.’
An analyst at China Merchants Securities agreed, saying the plan is needed now so that telecom manufacturers can get to work on next year’s investment plans.
The analyst said,’Domestic telecom manufacturers need to upgrade their products and know if they should invest more in emerging sectors like 3G.’
The reports suggest that China Unicom’s wireless network based on GSM technology would be absorbed by fixed line company China Netcom.
China Telecom, the biggest fixed-line phone operator, would acquire Unicom’s CDMA mobile phone business.
Breaking up Unicom, which is a distant second in a two-player mobile market, is seen as the only way to resolve the problems created by its early decision to operate two wireless systems, one based on American and one on European technology.
The only new element is the idea that China Mobile, the wireless king, now the world’s largest phone company by subscriber count, would take over China Tietong, a fixed-line company.
Lu Guoying said, ‘China Mobile will get a fixed-line operating license by merging with China Tietong, but Tietong has only a very small number of fixed-line subscribers.’
Tietong, formerly known as China Railway Communications, is the country’s No 5 telecom operator, offering services along the rail network.
Information industry minister Wang Xudong said last month that China would issue full-service licenses to telecom operators this year, permitting them to run both mobile and fixed-line services.
Full-service licenses are seen giving the moribund fixed-line operators a chance to get back in the game against China Mobile, whose nine months’ net profit of RMB59.88 billion exceeded that of the other three major operators combined.
China Telecom and China Netcom both reported fixed-line subscriber losses in November due to falling mobile service charges.
Source: CNN Money
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