The Central Economic Work Conference specifically mentioned that the opening pilot of the telecommunications sector will be expanded.

From December 11th to 12th, the Central Economic Work Conference was held in Beijing. The conference mentioned the need to expand the pilot opening up of the telecommunications sector. This means that the opening up of the telecommunications sector to the outside world will be further expanded.

In April this year, the Ministry of Industry and Information Technology issued the "Notice on Carrying out Pilot Projects to Expand the Opening up of Value-added Telecom Services" and the "Pilot Program for Expanding the Opening up of Value-added Telecom Services", and decided to carry out pilot projects to expand the opening up of value-added telecom services. Telecom services can be broadly divided into basic telecom services and value-added telecom services, with basic telecom services including voice calls and network connections, while value-added telecom services refer to applications and functions other than basic telecom services, such as short messages.

The notice mentioned that the foreign equity ratio restrictions on the following value-added telecommunications services will be lifted in the pilot areas: Internet Data Centers (IDC), Content Delivery Networks (CDN), Internet Access Services (ISP), Online Data Processing and Transaction Processing, as well as Information Services such as information publishing platforms and delivery services (excluding Internet news information, online publishing, online audio-visual, and Internet cultural operations), and information protection and processing services.

The first batch of pilot cities includes Beijing, Shanghai, Hainan, and Shenzhen. These cities officially started pilot work in October this year. This means that foreign-funded enterprises can operate telecom services such as Internet data centers, online data processing, and transaction processing in the pilot areas, and deeply participate in China's computing power, cloud services, and other markets, jointly promoting the development of China's digital industry.

According to the data, by the end of September this year, a total of 2220 foreign-funded enterprises have been approved to operate telecommunications businesses in China.

"This marks a new stage of opening up of China's telecommunications industry to the outside world," said Wang Zhiqin, Deputy Director of the China Academy of Information and Communications Technology, in a previous media interview.

In the past two days, among the nine key tasks for next year deployed at the Central Economic Work Conference, it is explicitly mentioned to expand the pilot opening-up in the telecommunications field, indicating that the trend of China's telecommunications opening-up will be strengthened next year. 'Next year, efforts will be further made to expand value-added telecommunications services.' Ma Jihua, the founder of DARE Group, believes that 'there is a greater possibility of expanding the opening-up of value-added telecommunications services, while the possibility of implementing the opening-up of basic telecommunications services to the outside world is relatively smaller.'

Wang Zhiqin has stated that expanding foreign access to the telecommunications market is conducive to enriching the variety of products and services in China's value-added telecommunications service market, promoting the deep integration of digital technology with various industries, providing telecommunications users with more choices, and driving the growth and enhancement of China's digital economy. He also believes that this is conducive to steadily expanding institutional opening up, accelerating the integration of industry institutional systems and regulatory models with international high-standard economic and trade rules.

The specific direction of expanding the opening pilot in the telecommunications sector, the industry speculates that one direction may be that the pilot may be expanded from the current four cities to more cities, and another direction is that the equity ratio of foreign investment in specific telecommunications companies may be further relaxed. 'In the past, the equity of foreign investment in telecommunications companies was restricted, for example, it could not exceed 50%, and they could not take control. Next year, some businesses may achieve breakthroughs, and foreign investment may be able to take control,' Ma Jihua said.

Internet data centers, internet access, and online stores are value-added telecommunications services that are more favored by foreign investment. Wang Zhiqin previously stated that 'opening up internet data center business to foreign investment will help attract foreign enterprises to increase their investment in computing facilities in China and promote the higher-level and higher-quality development of China's computing power.'

From the current Shanghai pilot, 10 foreign-funded enterprises, including Tesla, Tock, HSBC Jinke, Siemens Digital Medical Technology, Liepin, Qinda Rui, Yili Internet, Unity, Prose, etc., have already pre-filled the application form for carrying out value-added telecommunications services. Unity told reporters that this pilot provides the company with a more direct opportunity to face Chinese customers. The company can deploy its own services in the form of IaaS, PaaS, etc. (such as virtual machines, cloud databases, cloud storage, etc.) based on cloud vendor services, and provide multiple services represented by game battle suit hosting services, and deliver them to end users.

An operator engaged in IDC told reporters that the degree of market competition is controllable. "Although theoretically IDC market competition will intensify, the actual impact on the future operation of my company may not be significant. In addition to product competitiveness, competition in the IDC business also needs to consider factors such as compliance and energy consumption indicators." He said.

(Article Source: First Financial Daily)

Source: Eastmoney.com

Author: First Financial