Merges Between China's State-Run Telecom Companies Likely For Moving Forward To Issue Third Generation (3G) Licenses

FT (SHANGHAI)--On 15 August 2007, Financial Times via a China Telecom source stated that the fixed phone service provider (China Telecom) could possibly merge with mobile phone network operator China Unicom. Furthermore, China Mobile, could possibly merge with key fixed phone service provider China Netcom. China Netcom and China Telecom formerly were united but split in 2002. China Netcom now mainly covers north China while China Telecom dominates the fixed phone business in south China. The China Telecom internal source also said China Telecom has tried to avoid duplicate coverage in the Personal Handyphone System (PHS) business with China Unicom. The source also states China Telecom also wants to get a Third Generation (3G) license, and added that it why China Telecom is eager to involve or buy a mobile phone network. Prior reports state China Unicom denied its Code Division Multiple Access (CDMA) network to China Telecom to merge with China Netcom to get a 3G license. The report states it is likely that China Telecom, after acquiring the CDMA network from China Unicom, will get a 3G license along with China Mobile.

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