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Chinese Telecom Companies Ordered to Share, Co-build Infrastructure

Chinese government on Monday ordered its three domestic telecom operators to share and co-build infrastructure to avoid repeat construction in the wake of industry restructuring.

The move would erode the competitive edge of China Mobile, the nation's largest mobile operator, as its smaller rivals could access its wider network.

A circular jointly issued by the Ministry of Industry and Information Technology (MIIT) and the State-owned Assets Supervision and Administration Commission (SASAC) of the State Council required China Mobile, China Telecom and China Unicom to promote the sharing and co-construction of infrastructure and avoid repeat building in the industry overhaul and the new round of network construction starting this month, according to the circular.

The existing telecom towers and lines must open to rivals. If conditions were not ready for sharing, operators should expand and adjust their technologies, said the circular.

If an operator planned to build telecom towers and lines, other operators should inform it in 10 working days if they had such facilities to share or plans to join the construction. They will be banned from building at the same sites and routes within three years if they show no need for co-construction, the two agencies said.

If conditions were appropriate, the operators should join together in building new base stations and transmission lines. They also should open the existing facilities to each other, the circular stated.

In the industry overhaul, China Telecom bought China Unicom's code-division multiple access (CDMA) network and China Unicom merged with China Netcom. China Mobile took control of China Tietong Telecommunications Corp.

The restructuring allowed China Telecom, China Unicom, and China Mobile to all provide both fixed-line and wireless services.

The restructuring came as wireless operators enjoyed fast growth while fixed-line operators saw a slump in numbers of subscribers since last year.

China Mobile has more than 400 million mobile phone users, more than triple that of China Unicom. China Telecom has about 43 million wireless subscribers after acquiring the CDMA assets from China Unicom.

(Xinhua News Agency October 7, 2008)

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