China needs to speed up the development of its
telecommunications industry by introducing more competition - a
move that would weaken the market power of heavyweight operators, a
top official said yesterday on the sidelines of the ongoing
Communist Party of China National Congress in Beijing.
"Restructuring plans are coming in, providing different
solutions," said Lou Qinjian, deputy minister of the Ministry of
Information Industry. "The linchpin is to secure the rapid growth
of the sector and bring more benefits to people."
China now has four major players in the telecommunications
industry, with China Mobile and China Unicom licensed to supply
mobile services and China Telecommunications and China Netcom in
fixed-line services. As the number of cell-phone users continues to
outpace land-line subscribers, there is a sharp difference in
operational results.
Last year, for instance, China Mobile contributed 70 percent to
80 percent of the industry's total profit while land-line operators
were on the defensive.
According to their half-year reports, China Mobile recorded a
net profit of 37.9 billion yuan (US$4.99 billion), while China
Unicom posted 5.65 billion yuan, China Telecommunications 13.48
billion yuan and China Netcom 6.713 billion yuan.
From January to August, the average monthly rise in cell-phone
users amounted to 6.82 million, more than 10 times the rise for
land-line subscribers. More than 378.5 billion short messages were
sent out in Chinese, up 38.3 percent from the same period last
year.
Lou didn't specify the objectives of the restructuring. But a
previous report in Caijing, a financial publication in
Beijing, said the restructuring would be mainly targeted at
balancing the development of major operators. For private and
foreign capital, entering China's domestic telecommunications
operational market is still "a mission impossible," the report
said.
Lou also said there was no timetable for the issuance of
third-generation telecommunications licenses as government
departments were still considering how to manage 3G services.
He said there was still no decision on the 3G technologies to be
used during the Beijing Olympics next year.
"Our major concern is whether the technology can satisfy the
needs for bandwidth and transmission speed," he said.
(Xinhua News Agency October 19, 2007)
