Fourth telecoms license awarded in China

The Chinese government has awarded a telecommunications business license to a fourth player, China Broadcasting Network, entering the market.

State-owned broadcaster CBN has received approval by the Ministry of Industry and Information Technology (MIIT) to provide telecommunication services and become an additional competitor to China Mobile, China Telecom and China Unicom.

A statement released by the MIIT said it awarded CBN a basic telecommunications business license in the hope of further expanding the breadth and depth of the telecommunications and broadcasting markets while promoting additional healthy competition. The license will permit CBN to deliver domestic internet services and traditional domestic communications infrastructure as well as its existing television services in a triple-play move.

With the long-established three players totally dominant in the market, with China Mobile verging on a billion subscriptions, there are questions from some quarters over the chances of a fourth player entering the market. Analysts from Nomura, cited by Reuters, aren’t holding out much hope for the new entrant in the short term, however.

“We do not think CBN will become a major threat to existing telecom operators in the near term, unless CBN can resolve its own financial bottlenecks and complete the process of national television and broadcasting network consolidation,” said analyst Leping Huang, who also predicted a $3 billion investment to be made by the operator in its telecoms services and infrastructure.