China's industry-wide telecommunications shake-up continued as China Netcom Group's minority shareholders approved their planned merger with China Unicom, as well as the sale of Unicom's CDMA network to China Telecom Group, the parent firm of China Telecom. China Telecom's shareholders in turn separately approved the telco's plan to lease the CDMA network from its parent firm.
The merger of China Unicom and China Netcom likely will be completed Oct. 15. China Telecom also hopes to enter the mobile market next month. China's telecom industry restructuring has been discussed for many months, and initial steps toward these deals were taken last spring with the expectation that the shake-up would accelerate after the Beijing Summer Olympics were completed.
Though the ability of landline telcos China Telecom and China Netcom to compete on the mobile front will be enhanced by these deals, the telcos still have to tussle in the market with China Mobile. As part of the industry restructuring, China Mobile earlier merged with landline telco China Tietong Telecommunications. One of the final steps in the grand plan is for China Satellite Communications to be merged with China Telecom Group.
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