China Operators Mull Tower Spin-off
In a surprise move, China's network operators are considering spinning off their mobile towers into a jointly owned tower company.
The plan, rumors of which surfaced earlier this week, was confirmed by the industry regulator MIIT (Ministry of Industry and Information Technology) on its website Wednesday.
The MIIT statement said the three telcos were studying the joint creation of a dedicated firm that would coordinate tower facilities construction "and further improve the level of joint construction and sharing of telecom infrastructure."
The move comes as the three network operators -- China Mobile Ltd., China Telecom Corp. Ltd., and China Unicom Ltd. -- continue with their extensive investments in 4G radio access equipment, and the transport systems needed to support a major ramp in data services, across the country. (See China Mobile Dishes Out 100G Deals, China Unicom Calls 4G Tender, China Issues 4G TDD Licences, and China Holds Key to LTE TDD.)
Tower-sharing is widely used in other Asian emerging markets as a way of sharing the cost of large-scale rollouts, but would be a major departure for China's traditional, state-controlled industry structure, which permits only three operators to build and manage infrastructure to serve the country's 1.1 billion mobile users.
Direct government control of the sector will not change, but as part of the wider government effort to spark economic growth, the MIIT has licensed a dozen MVNO players to provide service -- the first privately held telcos allowed into the market. (See Year of the Horse: Can China Telecoms Break Into a Gallop?)
Robert Clark, contributing editor, special to Light Reading