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Satnews Daily
April 14th, 2009

China's Aerospace Science and Technology Gobbles China Satellite Communications

Great Hall of People Despite a reform drive it was announced that China Satellite Communications Corp. (China SATCOM) is now a fully owned subsidiary company of the China's Aerospace Science and Technology Corp. China SATCOM officially became a fully-owned subsidiary company of the China's Aerospace Science and Technology Corp. (CASC) after a merger ceremony held in the Great Hall of the People on Friday. The merger was planned by the State Council, or Cabinet, as a way to deepen reforms in the country's telecommunications industry.

Photo courtesy of the University of Warwick website: The Great Hall of the People is located on the western edge of Tiananmen Square. It was one of ten structures built in Beijing to commemorate the 10th anniversary of the People s Republic of China in 1959. The Great Hall of the People has a total floor space of more than 170,000 square meters. That is divided into three, main sections: a 10,000-seat auditorium, a banquet hall where 5,000 people can dine at one time (as was done on the occasion of Richard Nixon's visit to China in 1972) and the offices of the Standing Committee of the National People s Congress and reception halls named for each of China's province. The Great Hall of the People is 336 meters long from north to south, 206 meters wide from east to west, and 46.5 meters high at the highest point. The Great Hall of the People is now open to both domestic and foreign visitors.

CASC general manager Ma Xingrui, said the merger would extend the corporation's traditional services of researching and manufacturing of satellites to operating satellite-based telecommunications.

CASC deputy general manager Rui Xiaowu, also the former general manager of China Satcom, said China Satcom will now mainly focus on three service aspects: satellite spatial operations, providing geographic data and locations, and satellite-ground communications.

China Telecom was called Directorate General of Telecommunications, P&T, China at first. In 1995, it was registered the legal representative, from then on, separating enterprises from government management. In 1998, the post and telecommunications services separated, specializing in the telecommunications operation. In 1999, the services, satellite services and mobile services were separated out from China Telecom. In 2000, China Telecom was established officially.

During 2001 to 2002, in order to break monopoly in the fixed telecommunications field, having been separated the mobile services, China Telecom was divided into the north and south part. In May, 2005, newly reformed China Telecom and China Netcom were established officially. The telecommunications companies in ten provinces, including Beijing, Tianjin, Hebei, Shanxi and Inner Mongolia of North China, Liaoning, Jilin and Heilongjiang of Northeast China, Henan and Shandong, belonged to the north part of China Telecom. Others belonged to the south part of China Telecom.

China Netcom Group Corporation (Hong Kong) Limited was merged by the north part of China Telecom together with China Netcom and Jitong Network Communications Company Limited.

The south part of China Telecom maintained the name, possessing the name of China Telecom and the intangible assets. Chinese telecommunications market was gradually formed the competition patterns with the basic telecommunications companies of China Telecom, China Netcom, China Mobile, china Unicom, China Satcom and China Tietong.

There are three purposes for the mergers: first, strengthening the competitiveness of the operators; second, changing the disparate competition pattern; third, creating service reform opportunities for the operators.

The newly built China Unicom obtained the 3G license, the largest scale and well-rounded in the world. Because of its mature industry chains and the low price for the equipment, the newly built China Unicom had advantages in the competition of 3G service.

Meanwhile, WCDMA service is the technical standard of 3G in the world, the fastest growth in the users. It had obvious competition advantages compared with the CDMA2000 services, especially the later reform towards 4G. At present, WCDMA standard is the most mature, receiving supports from various major telecommunications equipment manufacturers. However, the market operation capacity of China Unicom fell behind China Mobile. The development perspectives of WCDMA services in China need further investigation. By the end of 2008, the accumulative GSM mobile phone users of China Unicom reached to 133.365 million and 100.146 million of the fixed phone users.

China Telecom is the largest operator of the fixed phones. By the end of 2008, the users were more than 208 million, but the users cut down by about several million in each month averagely. Since its acquisition of CDMA services of China Unicom, the CDMA users decreased in a successive three months in the end of 2008. By the end of 2008, the CDMA users of China Telecom totaled 27.91 million, down by 1.17 million compared with the beginning of acquisition. But the CDMA users increased in the beginning of 2009.

The Internet users of China Telecom were 44.27 million at the end of 2008, accumulative net growth by 8.62 million in 2008. The Internet users of China Unicom were 25.416 million at the end of 2008.