Changes to give 'Big 3' fresh zeal

Maintaining profit stream still a tough challenge, say experts

Laughs were shared, hands were shaken and some tears shed after the much-anticipated change of the guard at the nation's top three telecom carriers on Monday.

A day after the new helmsmen took control, there are still several unanswered questions like what else will change for the carriers besides the nameplates on the chairmen's doors.

Shang Bing, former vice-minister of industry and information technology, the industry regulator, was named chairman of China Mobile Communications Corp, the world's biggest telecom carrier by subscriber numbers. Not surprisingly the change of leadership at the top telecom carrier was supervised by Miao Wei, the minister for the MIIT.

Primary among the new 60-year-old chairman's tasks are steps to boost the Internet speed and reduce charges. Though Miao reminded Shang of the tasks in a jocular fashion, it does appear to be a challenge that the latter cannot back away from.

What was surprising at the bonhomie was it was Shang and his team who had championed these causes during his stint at the ministry. The role reversal has made the market eager to see how Shang will solve the thorny task that he had been advocating as a vice-minister.

The ministry urged carriers to lower Internet connection fees earlier this year after Premier Li Keqiang said the nation's Web service was too expensive.

The carriers were slow to respond to the call because they - all State-owned enterprises - are already facing strong pressure to maintain revenue streams and profit.

Cao Shumin, president of the China Academy of Information and Communications Technology, said carriers will be willing to cut prices if the government agrees to cut the profit that they need to transfer to it.

Shang, who had worked earlier with China Telecommunications Corp and China United Network Communications Group Co before joining the MIIT, understands the government's intention as well as difficulties the carriers are facing.

Wang Xiaochu, former chairman of China Telecom, meanwhile, also swapped roles with Chang Xiaobing, the former chairman of China Unicom, on Monday.

Wang, 63, burst into tears while receiving an emotional goodbye at the China Telecom headquarters before leaving for his new office in China Unicom two blocks away in Beijing.

Patrick Shum Hing-hung, investment manager at Tengard Fund Management in Hong Kong, said: "The management reshuffle is a regular personnel change. In my opinion, these changes should not be related to mainland telecom market consolidation."

Xiang Ligang, an independent analyst and founder of telecom website cctime.com, said the reshuffle seems like a regular change and the signs of strategic change is weak.

Luigi Gambardella, president of ChinaEU, an organization in Brussels that works on better China-EU cooperation in telecommunications and Internet industry, was more optimistic about the changes the appointments may bring.

"I hope they will roll out their global strategy as soon as possible," he said.

Contact the writers at gaoyuan@chinadaily.com.cn and fujing@chinadaily.com.cn

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