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PR Newswire
19-12-2013, 09:43 PM
Reform in telecommunication sector...
China’s billionaires set to shake up largest wireless market
BEIJING – Chinese billionaires Jack Ma and Zhang Jindong may get licences this month to start phone companies in China, fuelling government efforts to cut prices and promote high-speed networks in the world’s largest wireless market, Bloomberg News reported on Thursday.
Chinese leaders this year proposed allowing private companies to use the networks of state-owned carriers China Mobile, China Unicom (Hong Kong) and China Telecom Corp. The potential gains from access to a US$213 billion industry prompted Mr Zhang’s Suning Commerce Group to partner with China Unicom; billionaire Jack Ma’s Alibaba Group to seek a licence; and Gome Electrical Appliances Holding to discuss leases with state carriers.
As China pushes consumers to upgrade to faster networks, President Xi Jinping has turned to private-sector companies to shoulder some of the marketing and promotional burden of luring new users. Allowing challenges to state carriers may lead to price cuts, more choices in service plans and better customer service for users of China’s 1.2 billion wireless accounts.
“The benefits could come on the front end, that is, through better service and an increased range of options for consumers,” said Mr Bertram Lai, a Hong Kong-based analyst with CIMB Securities. “Consumers may benefit from being able to have their phone service from a more proactive organization that caters specifically to their needs.”
For example, a user could buy a wireless package from an e- commerce company that offers free voice minutes in exchange for spending a certain amount of money on their website, Mr Lai said.
New entrants will capture about 10 per cent of China’s mobile-phone connections by 2018, said Ms Nicole McCormick, an analyst at researcher Ovum. Retailers selling phones could lease spectrum and package the handsets with wireless services to target the millions of migrant workers who crisscross the country every year between factories and their rural homes, Ms McCormick said.
The Ministry of Industry and Information Technology said in May that private companies could submit applications for a two- year trial ending in December 2015. Licences to resell wireless capacity to consumers may be issued as soon as this month, though the government hasn’t released a timeline or specified the rates carriers can charge to lease spectrum.
The ministry on Dec 4 issued 4G licenses to the three state carriers. Mr Miao Wei, head of the ministry, told government leaders Nov. 12 that a “deepening of telecommunication reform” was planned. Issuing licenses for mobile virtual network operators is one of those reforms.
The reforms limit foreign investors to less than 10 per cent ownership. That rules out Asia technology giants like Japan’s SoftBank and may hinder China’s largest Internet companies, including Alibaba, Baidu and Tencent Holdings, all of which have international shareholder stakes exceeding the limit.
http://www.todayonline.com/business/chin...ess-market
China’s billionaires set to shake up largest wireless market
BEIJING – Chinese billionaires Jack Ma and Zhang Jindong may get licences this month to start phone companies in China, fuelling government efforts to cut prices and promote high-speed networks in the world’s largest wireless market, Bloomberg News reported on Thursday.
Chinese leaders this year proposed allowing private companies to use the networks of state-owned carriers China Mobile, China Unicom (Hong Kong) and China Telecom Corp. The potential gains from access to a US$213 billion industry prompted Mr Zhang’s Suning Commerce Group to partner with China Unicom; billionaire Jack Ma’s Alibaba Group to seek a licence; and Gome Electrical Appliances Holding to discuss leases with state carriers.
As China pushes consumers to upgrade to faster networks, President Xi Jinping has turned to private-sector companies to shoulder some of the marketing and promotional burden of luring new users. Allowing challenges to state carriers may lead to price cuts, more choices in service plans and better customer service for users of China’s 1.2 billion wireless accounts.
“The benefits could come on the front end, that is, through better service and an increased range of options for consumers,” said Mr Bertram Lai, a Hong Kong-based analyst with CIMB Securities. “Consumers may benefit from being able to have their phone service from a more proactive organization that caters specifically to their needs.”
For example, a user could buy a wireless package from an e- commerce company that offers free voice minutes in exchange for spending a certain amount of money on their website, Mr Lai said.
New entrants will capture about 10 per cent of China’s mobile-phone connections by 2018, said Ms Nicole McCormick, an analyst at researcher Ovum. Retailers selling phones could lease spectrum and package the handsets with wireless services to target the millions of migrant workers who crisscross the country every year between factories and their rural homes, Ms McCormick said.
The Ministry of Industry and Information Technology said in May that private companies could submit applications for a two- year trial ending in December 2015. Licences to resell wireless capacity to consumers may be issued as soon as this month, though the government hasn’t released a timeline or specified the rates carriers can charge to lease spectrum.
The ministry on Dec 4 issued 4G licenses to the three state carriers. Mr Miao Wei, head of the ministry, told government leaders Nov. 12 that a “deepening of telecommunication reform” was planned. Issuing licenses for mobile virtual network operators is one of those reforms.
The reforms limit foreign investors to less than 10 per cent ownership. That rules out Asia technology giants like Japan’s SoftBank and may hinder China’s largest Internet companies, including Alibaba, Baidu and Tencent Holdings, all of which have international shareholder stakes exceeding the limit.
http://www.todayonline.com/business/chin...ess-market
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