High Broadband Fees: A Major Problem in the China Telecom Sector

Published Date : Apr 30, 2015

A common reason for complaint and dissatisfaction in the China telecommunications market has been the snail paced download speed amongst the users of the internet in China. not too much of attention was given towards this issue for a rather long time, however, sometime early this month, Li Keqiang expressed his disappointment and dissatisfaction over China’s outdated and underdeveloped information infrastructure, steep online fees, and most importantly, slow downloading speed. 

It has been observed that there are several reasons why telecommunications operators charge such high rates for broadband services. This also includes a long cycle of investment and the costs of infrastructure construction of the fixed line nature. Also, experts have stated that these are not the only reasons for high internet charges. Complex and complicated business relationships that exist between several telecom operators is also another prominent factor that has led to this situation of “deficient competition” within the market structure. 

A market research group in China has however stated that there seems to be a certain degree of balance that exists between the three main giants in the China telecom sector. If there is the need for enhancing the speed of broadband and subsequently bring down the prices, all these three key players will have to work towards this goal all at the same time and in close collaboration with one another. China Mobile Ltd., China United Network Communications Group, and China Telecommunications Corporation are the three key market participants in the China telecom industry. Gehua CATV Network and Great Wall Broadband Network are the other small players in the industry.