The government will continue to push reform of the telecom
industry, the State assets body said yesterday.
Wang Ruixiang, deputy chief of the State-owned Assets
Supervision and Administration Commission (SASAC), told a telecom
forum in Beijing the reform would be deepened to "boost the
sustainable development of (telecom) companies".
Large State-owned companies need to be merged or restructured to
"increase efficiency", he said.
The SASAC is believed to be engineering a reshuffle of the
telecom industry, although it has previously denied the move. One
of the most rumored proposals is that the number of large operators
could be reduced from four to three.
Under that arrangement, China Unicom, the country's No 2
cellular operator, would be divided into two, with one of its
wireless networks sold to fixed-line carrier China Telecom and the
other merged with China Netcom. China Mobile, the dominant mobile
operator, would remain unchanged.
China Telecom chief Wang Xiaochu has publicly proposed buying
one of Unicom's wireless networks.
Unicom's shares traded in Shanghai have more than tripled since
last June, partly helped by speculation of a possible sale of one
network.
Lou Qinjian, vice-minister of the information industry, said on
the sidelines of the 17th National Congress of the Communist Party
of China last week that the ministry supported a reshuffle of the
domestic telecom industry.
It's the first time the Ministry of Information Industry (MII)
has given its support to the restructure. The SASAC is believed to
have a bigger say in the possible reshuffle.
A researcher with the SASAC said the ministry is still
collecting proposals for the restructure and the final scheme is
unlikely to be announced before next March when a new Cabinet will
be formed.
Several ministries have been involved in the restructure
including the SASAC, MII and the National Development and Reform
Commission. Disagreements between regulators have complicated and
delayed the process, analysts said.
However, the continuing slowdown of the fixed-line telephone
business might eventually force regulators to speed up the
restructure, the SASAC researcher said.
In the first nine months, China Mobile Ltd's profit surged by 30
percent.
Meanwhile, China Telecom Corp Ltd managed profit growth of just
1.8 percent during the period, as its fixed-line subscribers
continue to switch to mobile phone services.
China Telecom lost 730,000 subscribers in September, compared
with 380,000 in August.
(China Daily October 25, 2007)
