It's a new era in China telecommunications, formally at least, with the rare sight of a new entrant.
Newcomer China Broadcast Network Corp (CBN), which officially started operation yesterday, is a different beast from the three incumbents, all of which have been spun out of the old telecom ministry.
CBN is owned by the broadcast agency, the National Radio and Television Administration (NRTA), and comprises dozens of provincial and city cable network broadcasters.
It took years of cajoling to persuade them to combine into a single entity with registered capital of 101.2 billion yuan (US$15.0 billion).
Yet commercially they have had little choice. The cable industry is leaking subscribers and badly needs to get some scale so it can invest in new infrastructure and compete with OTTs.
The NRTA is the biggest shareholder, with a 51% stake, while two important new investors, Alibaba and the power utility State Grid, have stumped up RMB10 billion ($1.5 billion) each for a 9.9% stake.
They bring some important attributes: Alibaba's e-commerce and cloud capabilities, and State Grid's energy management expertise and 3 million potential cell sites.
The new entity also offers the fragmented cable industry a chance to get in on 5G. Not only does it have a license, but it exclusively holds a slice of precious 700MHz spectrum.
It signed a network-sharing partnership with China Mobile in May in which they agreed to jointly build 700MHz infrastructure.
As part of the deal, China Mobile will provide CBN access to its 4G and 5G infrastructure where it has no coverage, and provide maintenance and operation services.
Yet observers are not positive about CBN's chances.
For one thing, it's walking into a market that is already badly unbalanced.
China Mobile captured 53% of total industry revenue and 77% of the profit in 2019. It has a market cap of $134.9 billion, compared to China Telecom's $25.7 billion and China Unicom's $21.3 billion, and in recent years it has used its scale to become the number-one fixed-line broadband player as well as the biggest in mobile.
If anything, by sharing the 700MHz band with China Mobile, CBN's entry will only entrench its dominance.
Meanwhile, its immediate problem is that its frequencies are not yet available.
Spectrum clearance in 40 or so key markets was supposed to be completed by June but because of the pandemic that hasn't happened. The new telco hasn't given an updated timetable of its network rollout or start of service.
Which leaves it in the hands of China Mobile, like everyone else.
- China's CBN gets Alibaba backing in $14.7B restructure
- China Mobile, CBN strike long-awaited network-sharing deal
— Robert Clark, contributing editor, special to Light Reading