Landmarks of China's telecom industry 2004

China has opened its basic telecom business, albeit not fully, to foreign investors as of December 11. The industry has a busy year before the opening.

Drafting of roadmap initiated

China began to map out the 11th Five-year Plan for its information industry in 2004, which was expected to make arrangements to carry out the central government's strategy of "putting information industry on the top priority", "promoting the industrialization with informationization and vice versa".

The Ministry of Information Industry will solicit suggestions and opinions about the planning from the society.

The software industry plays an important role in the information sector and has direct bearing on the national information security. In China, the government, the software industry and the public all agree that home-made software should be the choice of the government procurement.

Leading Chinese software producer Kingsoft assures of the quality of home-made software to satisfy the needs of e-government.

Experts include Ni Guangnan, an academician of Chinese Academy of Engineering highlighted the significance of having home-made software to break the monopoly of foreign products like Microsoft¡¯s office.

Opening-up

As scheduled by China's WTO commitments, foreign investors are allowed to have joint ventures with up to 25 percent stakes in basic telecommunication business as of December 11, 2004 in Beijing, Shanghai and Guangzhou.

Foreign telecom giants, as a matter of fact, have made presence in China. France Telecom, Deutsche Telekom AG, AT&T all have offices here which prelude aggressive actions.

3G

The 2004 TD-SCDMA Summit was applauded during the China International Communication Equipment and Technology Exhibition which attracted more than 600 exhibitors from 23 countries and regions in Beijing at the end of October. The turn-out of the national leaders at the booth of TD-SCDMA evidenced their confidence on and support to the 3G standard which was proposed by China and approved by International Telecommunication Union (ITU).

Before that, the GSM Association had made a significant change for its strategy and suggested a WCDMA-TD-SCDMA mix. In addition, more and more foreign producers have abandoned their wait-and-see attitude and joined the TD-SCDMA club.

In November 8-10, 3G in China, a global summit for 3G industry, was held in Beijing. The conference reviewed both latest development and vision of 3G in China and the world.

In recent years 3G has been one of the focuses which draws most attention. The licensing and standard of Chinese 3G will exert great influence on the global 3G market.

Lenovo-IBM collaboration

The milestone contract on take-over of IBM¡¯s PC assets by China's leading PC maker Lenovo on December 8 made real differences to the world PC market. Yang Yuanqing, president of Lenovo is Chairman of the new company while Stephen Ward from IBM the CEO.

Mergers and acquisitions are not rare in PC sector. However, Corporate US has long been dominant on this stage. But the debut of a Chinese player is on the spotlight this time.

The technically easier access of PC business has intensified competition and drained profits away in recent years. The alliance between Lenovo with solid foundation in Chinese market and tactful price maneuver and IBM with name brand, powerful R&D capability, good quality and global marketing network will pose great pressure on Dell, HP, as well as Japanese and South Korean notebook makers.

Legal framework

Insiders believe that the Law of Telecommunications is likely to be promulgated as early as mid-2005 after 24 years of conceiving and revising. Most attention will be given to articles on competition and supervision.

Growing Internet industry

By June 30, 2004, there were 87 million Internet users in China. a conservative forecast set the number at 90 million plus by the end of the year.

The 14th Statistical Survey Report on the Internet Development in China by China Internet Network Information Center (CNNIC) indicated that China's Internet industry had embarked on a rational way of development and the industrial chain related to the Internet had been full-fledged. It also showed the facts that broadband is the main access to the cyberspace and that a stable and massive market for online games has taken shape.

Also in 2004 China launched a large campaign to crack down porn web sites and unsolicited messages spreading through the Internet.

Recently China's first special commission for Ipv6 network was born in Beijing. Ipv6-based pilot networks have been initiated around the country.

4 operators go public

China Netcom was listed in US and Hong Kong on November 16 and 17 this year. This marks that the four biggest Chinese telecom operators have all gone public and the industry¡¯s head start over any other sectors in terms of property reform.

A few days before that on November 1 China Telecom, China Mobile and China Unicom experienced reshuffling of top executives.

Breaking monopoly and introducing competition has long been the tone of the reform of China's telecom industry.

Breakthroughs on super computers

Dawning 4000A developed by Chinese Academy of Sciences has been put into operation in Shanghai Super Computer Center. With the capacity of 10 trillion calculation per second, Dawning 4000A is one of the top 10 in the world. A number of breakthroughs and home-made system board are all embedded in it. In China it is the only super computer in which 64 bits is compatible with 32 bits.

Progress on production and design of chips

The launch of SMICS¡¯ production line for its 12-inch wafer in Beijing in September makes China one of the leaders in the global chip industry.

China also developed CPU, WAPI and 3G mobile chips with its own intellectual property rights.

By People's Daily Online