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MII Hints at Further Sector Liberalisation
China's telecom watchdog, the Ministry of Information Industry (MII), has pushed forward the network convergence of telecom and cable broadcasting by stating that it will allow them to operate in each other's fields at the same time.
Zhang Chunjiang, vice-minister of the information industry, said that the ministry encourages telecom carriers to transmit television signals and equally permits cable broadcasting companies to operate telecom businesses.
It would be a significant move forward in speeding up China's telecom reform.
"The mutual entry into the telecom and cable broadcasting sectors would help further break the telecom monopoly and better utilize the network capacity of both," said Zhang.
More than 90 million families in the country are linked to the cable broadcasting network, which is the biggest subscriber base in the world.
The network capacity and equipment used in the cable broadcasting sector is also the better than all its global counterparts.
On the telecom side, the number of fixed-line phone users had surpassed 160 million by the end of May.
Both networks are far-reaching, technologically updated fibre lines, which have the capacity to transmit both telecom and TV signals, said the official.
The mutual entry is fair and reasonable. It would help avoid duplicated construction and upgrade the utilization of both networks, commented Kan Kaili, a senior telecom expert with the Beijing University of Post and Telecommunications.
He said the optic fibres used in telecom and cable networks are identical and thus have same functions.
The management authority of the cable sector, the State Administration of Radio, Film and Television (SARFT), is also busy preparing to operate telecom businesses.
A nationwide communications group unifying China's wireless, cable and satellite broadcasting services is set to be launched before the end of the year, according to SARFT.
The Beijing-based group would be valued at more than 10 billion yuan (US$1.2 billion) and would have branches in all the country's provinces, autonomous regions and municipalities.
It will be a State-owned enterprise and SARFT will hold a controlling stake of at least 51 per cent.
Supervised by SARFT, it will bring local TV, cable and radio broadcasting stations into one conglomerate, which is also capable of being a strong telecoms operator.
Having a broader bandwidth than the telecom network, providing services such as Internet access, video-on-demand and interactive shopping, the cable network would reach far more people than the telecom networks.
Some local cable broadcasting companies have started trial operations in telecom businesses like Internet access via the cable network which have received a warm welcome from customers.
The technical preparation for the mutual entry of telecom and broadcasting is ready, the only barrier ahead being that the cable broadcasting sector wants to remain closed to others while at the same time enter the business range of telecom companies.
A senior official with SARFT described the administration's plan with a metaphor: Telecoms is a park and should be open to everybody, while cable broadcasting is a military camp which should not open. Soldiers could enter the park while their camps remained closed.
The attitude of the MII is also clear - it will only accept mutual entry. If the cable sector remains closed to the telecom sector, telecoms should not be open to the broadcasting sector.
Agree or not, the State Council should push for the convergence of the three networks: telecom, television and computer.
The convergence of broadcasting and telecom networks is unavoidable, said Kan of the Beijing University of Post and Telecommunications.
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