What Do The First Chinese Mobile Virtual Network Operators Plan to Offer?

What Do The First Chinese Mobile Virtual Network Operators Plan to Offer?

By Tracey Xiang on December 31, 2013

Chinese Ministry of Industry and Information Technology (MIIT) finally announced the first mobile virtual network operators (MVNO) last week, half a year after licenses were open for application. Of the eleven Chinese private companies that now owns licenses, there are four mobile phone distributors, four Internet infrastructure/solution providers, one carrier billing service, one bus/mobile media (BUSAP), and one online retailer (JD.com). Five of them will work with both China Unicom and China Telecom.JD.com, leading online retailers in China, is allowed to operate services with China Telecom in 46 Chinese cities and with China Unicom in 35 cities. JD will provide data plans, voice/multi-media messages, etc. on top of its JDPhone plan that was launched earlier. First services are expected to be available in May or June next year. It’s up to users to decide which carrier they’ll go with, according to JD.

Net.cn is a Chinese domain name and cloud-based solution provider that was acquired by Alibaba in 2009 and now is under Aliyun. So it is expected that the license obtained by Net.cn will be leveraged by other businesses of Alibaba such as Aliyun OS, the custom Android operating system that is used by partner smartphone makers and, more recently, smart TV manufacturers. Alibaba has reached partnership with both China Telecom and China Unicom too.

BUSAP, backed by the state-run TV station CCTV, provides TV programs and other media content on buses. With the MVNO license, BUSAP plans to offer servies for both end users on buses and bus companies. End users will be able to access content or other services either with 3G network or on-bus WiFi. For bus companies, BUSAP will offer Internet-based services or apps for bus monitoring, bus dispatch and so on.

The four mobile phone distributors, FunTalk, D.PHONE, TELLINE and Huajishijie (means Phone World) have been partnering with telcos for years. It’ll be easy for them to come up with mobile phone-related telecom services, but the concern with them must be that they’ll become competitors of Telcos’ ever since.

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Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (www.heroinnovator.com), the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

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