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China Telecoms chance to grab a piece of the mobile action in China

Raymond Yu | July 21, 2009
Without mobile, China Telecoms growth would have been dire

Service bundles aim to stabilise fixed revenues

Lets not forget that China Telecom is a fixed operator at heart and this will never change. Fixed services make up the bulk of its service revenues, and will for the near future. For instance, in 2008 97 per cent of total revenues came from fixed services. Naturally, China Telecom has to find ways to stabilise its fixed revenues, and hence it is striving to be the market leader in Chinas service bundle market.

Competitively bundling fixed and mobile services following a quadruple play service strategy will make perfect sense for China Telecom. It allows it to cross-sell mobile services to existing fixed customers, which if successful will increase loyalty within its customer base. However, it is likely that most of China Telecoms fixed customers will have mobile subscriptions already, so this is no easy task.

China Telecom has entrenched presence in its enterprise customer segment, and enterprise related fixed revenue is a very important share of its total fixed revenues. Fixed mobile convergence services such as unified communications (UC) will have an increasingly strategic impact to its enterprise customers.   

Raymond Yu is an Ovum analyst.


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