The China Telco reshuffle

Not much can be said beyond the facts: it appears to be happening, the telecoms market re-grouping in China has begun, three big fixed-mobile consortia will be formed (at least they are "encouraged" to form), and after that has been completed, the time for the 3G licenses is at hand.

The three resulting organisations will be called China Mobile, China Unicom and China Telecom each will be able to offer both fixed and mobile services, and the initial approach is asymmetrical enough to believe that the way this reshuffle has been designed has actually a pro-competitive background. Even thoug it has not been voiced that way, I do believe that the reason behind these plans is to allow the three groups a period of increasing competition, growing enough on the task so that after some years they are able to compete internationally. At the moment, I do not believe they could. Even a company such as China Mobile with its mind-boggling number of customers is first and foremost big, not necessarily great. These three companies need exposure to competition to be able to enter foreign markets at some point, which will then go hand in hand, have no doubt, with foreign players entering the fierce battel about the Chinese markets. Let the games begin!

Here are some sources, with some interpretation:
http://digitalwatch.ogilvy.com.cn/en/?p=262
http://www.techblog86.com/?p=110
http://www.theregister.co.uk/2008/05/31/chinese_3g/
http://www.plus8star.com/?p=122