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To: marginmike who wrote (65348)	1/30/2000 11:49:00 PM
From: JohnG	Respond to of 152472

China telecom spending plans. JohnG Competition looms for telecoms Date: 01/30/2000 Page: 5 Author: WANG CHUANDONG, Business Weekly staff China's telecommunications companies are expected to increase spending on the country's telecommunications infrastructure this year. Restructuring within the telecom industry is expected to clear the way for companies to respond to a dramatically increasing demand for services nationwide. A report from the Ministry of Information Industry indicates that companies in the sector, as a whole, plan to invest 200 billion yuan (US$24.1 billion) more in network infrastructure construction this year, an increase of 31.7 per cent from 1999. China's telecom sector, spurred up by the increasing demands of economic development and personal consumption, has benefitted from steady, double-digit growth in fixed-assets investment in recent years. The report said the sector invested 151.8 billion yuan (US$18.29 billion) in infrastructure construction last year, about the same as in 1998. The restructuring of China Telecom, which began in March, severely affected normal investment schedules in the telecom sector last year. This year's investment is expected to focus on the renovation of the core of the long-distance network using DWDM technology, optimizing local networks, expanding the capacity of the mobile telecom network and the amplification of band widths needed for Internet use, according to the report. The government decided to split the country's largest telecom operator, China Telecom, into four independent service providers beginning in March. The paging branch has been granted to China Unicom, the only nationwide rival to China Telecom. The mobile phone business, the most profitable arm of China Telecom, is being reorganized into a new company - the China Mobile Telecommunications Corp - which will be inaugurated soon. Information Industry Minister Wu Jichuan said fixed phone and satellite communications will be created once they gain State Council approval. The completion of telecom restructuring is expected to create a sound basis for the newly independent companies to expand their business this year. China Mobile Telecom has drafted an ambitious plan for its first-year's development in the market this year. The company's mobile user pool is expected to grow by 20 million to 60 million subscribers this year. Business revenue is expected to increase by 25 per cent to 103.8 billion yuan (US$12.5 billion). About 61.6 billion yuan (US$7.4 billion) in fixed-assets investments are expected to be made this year, including 7.6 billion yuan (US$915 million) in infrastructural construction and 54 billion yuan (US$6.5 billion) for technological renovations, said the company's annual report. China Telecom, which has been assessed a ceiling in its fixed-line business, plans to increase its user pool to 18.5 million this year, penetrating 16 per cent of the nation's population, up from the current 13 per cent penetration rate. China Unicom, an emerging player in the telecom service sector, expects to do well this year with the benefit of preferred policies granted by the government last year. The company will pour 28.9 billion yuan (US$3.48 billion) into the construction of its mobile telecom network this year, enough to handle 16.46 million subscribers, including 11.3 million users on its CDMA network. Mobile phone subscribers in China are expected to increase by 8.4 million to 13.63 million this year. Pager users are expected to increase by 5 million, said the company's annual report. The company's Uninet, an Internet access channel for Chinese Internet service providers, plans to attract 52.05 million Internet surfers this year.