China allows more private firms into telecoms

China's Industry and Information Technology Ministry (MIIT) on Monday licensed six more private enterprises to pilot resale of certain mobile services, in the latest move to open the largely monopolized sector.

The six are the third such batch of companies to be given the licenses, which allow them to partner and compete with China's "backbone" telecom operators through the resale of mobile services.

The companies can repackage the services they buy from the basic telecom operators before selling them to clients using their own brands, including voice, SMS, MMS and data services, according to a statement on the MIIT's website.

Before sales, the enterprises may need some preparatory work including the establishment of better charging and customer service systems.

The MIIT said it would closely monitor the progress of the pilot program and is ready to offer assistance to companies that face problems in providing the services.

The MIIT granted such licenses to 11 private firms in December last year and another eight in January.

The developments come after an MIIT guideline last June opened up the telecom sector to private capital, offering participation in eight major areas, including the resale of mobile communication.

In an earlier statement on its website, the ministry described the move as an important part of restructuring the telecom industry that will "help competition and innovation while offering more choices and better services to consumers."

To gain the licenses, private firms must sign a cooperation agreement with one of the three backbone operators -- China Mobile, China Unicom and China Telecom -- before filing an application with the MIIT.

The number of Chinese mobile phone users hit 1.22 billion at the end of October. Among them, 67.19 percent, or 817 million mobile phone users, are connected to the Internet and 34.5 percent of them are 3G users, according to the MIIT.

In early December, the ministry issued 4G licenses to the three backbone operators, opening a new era for China's high-speed mobile network.