Tencent keeps mum on telecom license rumor

Shenzhen-based Internet company Tencent Wednesday denied any knowledge that it might gain a mobile virtual network operator license that would allow it to join the first batch of Internet firms entering the telecom sector, as the country considers opening the sector to allow more competition.

"We have no knowledge of (a license issuance), and we will not comment on market rumors," Tencent, the country's largest Internet company in terms of value, said in a statement sent to the Global Times Wednesday.

Rumors have arisen in the media recently that relevant government regulators would consider issuing mobile virtual network operator licenses around June 2013, and licensed enterprises would then be eligible to provide basic telecommunication services via the Internet or networks they rent from the telecom carriers.

And Tencent, which has increasingly been regarded as one of the biggest rivals to the country's three telecoms due to its popular mobile chat app WeChat, is currently widely predicted to be the first winner of such a license.

The Ministry of Industry and Information Technology (MIIT), the nation's top telecom regulator, could not be reached for comment by press time.

The ministry is discussing detailed rules for opening up the telecom sector to private investors, the Securities Daily reported Wednesday, citing an undisclosed source familiar with the matter, while noting there remains no confirmation of a new licensing policy from the ministry.

"The licensing policy, if confirmed, would mark a new chapter in the nation's telecom sector development, as private enterprises will be offered equal market access to the telecom industry, which would impact the long-time market dominators - the country's three telecom firms," Ma Jun, chief analyst for the telecom, media and technology sectors at Guiyang-based Huachuang Securities Brokerage Co, told the Global Times Wednesday.

In the mobile Internet era, Internet firms have already posed challenges to the nation's three telecom carriers, which remain largely reliant on traditional telecommunications despite their continued efforts to shift into mobile Internet, Dong Xu, an industry analyst at Analysys International, told the Global Times Wednesday.

But analysts remain concerned about the possibility of Internet companies gaining such licenses, even though the license policy's arrival is only a matter of time.

"There is no doubt that private enterprises will ultimately join the telecom battlefield; however, a key factor for Internet companies (to be issued such licenses) will be their nature - whether they belong to private investors or not," Ma remarked.

Some Internet companies might be regarded as foreign-invested enterprises due to their shareholder structures, while the government will only allow privately invested domestic firms into the nation's telecom sector, according to Ma, citing an MIIT statement in late June which revealed that eight basic types of telecommunications will be opened to private investments.