China's major telephone operators are squaring up to each other
as 3G services loom.
Despite reporting a 2006 net profit of almost 10.6 billion yuan
(US$1.4 billion) on Monday, China Netcom, one of the country's two
leading fixed-lined telephone operators finds itself -- along with
its fixed-line rival China Telecom -- in a position of weakness
compared with the country's mobile phone operators.
With new cell phone subscribers far outpacing new fixed-line
phone users, the two fixed-line operators have decided to cut
capital expenditure budgets for 2007.
The cuts are intended to improve their 3G preparedness. China
Telecom Chief Wang Xiaochu said his company has improved cash flow
to prepare for the purchase of 3G licenses.
Wang Xudong, China's information industry minister, said the
country will provide 3G services for the 2008 Olympic Games.
Analysts predict China will complete 3G network infrastructure
construction in six to twelve months.
The major four operators -- China Netcom, China Telecom, China
Mobile and China Unicom -- have started training 3G talents,
constituting a war chest and making technological preparations for
a smooth transition from the existing mobile telecom networks or
PHS networks to 3G.
China Mobile, the largest mobile operator in China, has played a
leading role in tests of the homegrown TD-SCDMA network. China
Telecom and China Netcom have also taken part. They have built a
total of 100 base stations for the test networks.
China Unicom, the second largest mobile operator, saw its CDMA
network turn a profit for the first time last year. It will provide
3G services in Macao at the end of 2007 and is applying for 3G
licenses in Hong Kong.
China Telecom, the largest fixed-line operator in China, hopes
to transform its business by acquiring mobile telecom assets,
according to the company's general manager.
Squeezing investment in its fixed-line network, China Netcom has
been restructuring its internal assets, and in particular
integrating the assets of the former Asia Netcom, so that it can
use its resources more efficiently.
(Xinhua News Agency April 4, 2007)