China will set up four integrated telecom operators that provide
fixed-line, mobile, data and other basic telecom services in a move
to make the telecom market more competitive, Minister of
Information Industry Wu Jichuan said Monday.
Wu
said the restructuring will take at least two years since most
operators have separate licenses for either fixed-line or mobile
service.
Thanks to reform efforts that started in 1998, the telecom market
is now becoming competitive in China. It has two mobile operators,
three fixed-line operators and one satellite operator, Wu said.
The telecom reforms split monopolized multifunction telecom
operators into single service providers, a necessary step to make
the industry more competitive.
The government will let them become competitive in individual
businesses first and then allow them to gradually form integrated
service providers.
"With four integrated service providers, the market will become
fully competitive, and customers will be able to enjoy high quality
services at reasonable prices," the minister said.
The government has considered encouraging telecom operators to go
public in the domestic stock market instead of the overseas bourse,
Wu said.
Wu
also said that the two new fixed-line carriers, China Network
Communications Corp and China Telecom Group,
will be officially launched on February 12, the start of the Spring
Festival.
Wu
started working in the telecom industry in 1959 and has been in the
spotlight during the reform process. The performance has yielded
mixed results.
The industry, which is developing far ahead of overall economic
growth, has become the world's leader in both equipment
manufacturing and telecom customers.
Last year, China surpassed the United States in the number of
mobile phone users and is gaining in the number of fixed-line
telephone users.
China has registered 90 million new telephone users, 60 million of
whom chose mobile phones, Wu said.
"The record is hard to break," he said.
He
predicted that 70 million people will become new telephone users,
with 50 million of them turning to mobile phones.
With more telecom companies expanding and itching to go public, the
government has considered the domestic market as a good choice
along with the overseas bourses, Wu said.
China
Mobile and China Unicom, the country's dual mobile carriers,
have both listed in the overseas markets and attracted more than
US$20 billion.
The management level of the two has been significantly upgraded
according to requirements of the international markets. Yet the
interests of overseas stock investors and domestic customers are
sometimes hard-pressed to compromise, Wu said.
When the operators cut prices to attract more customers, investors
think that their profits will fall so they sell the stocks. But
that just pushes down the stock price.
But keeping it at a high price would make investors happy and hurt
customers.
If
the stock investor and telecom customer are one person, he will
balance the situation by himself, the minister said.
"Telecom operators might not have to go to the overseas stock
markets," Wu said. "With the maturity of the domestic bourse, the
home market might also be a good choice."
Besides, domestic stock investors will have opportunities to buy
high growth telecom shares -- something they never got the chance
to acquire, the minister said.
(China
Daily January 8, 2002)