Number Network Competition: The Open Up and Reform of China's Telecommunications Industry: The Open Up and Reform of China's Telecommunications Industry

Author: Zhou Qiren
Publisher:
Publish Date: 2001-08-01
Features: In 1998, AT&T announced its merger with TCI, the second-largest cable TV company in the United States, with a total transaction value of $48 billion. Why did AT&T choose to acquire TCI, a cable TV company that seemed completely unrelated at the time? Comparing international experience, how will the opening and reform of China's telecommunications industry unfold? See the discussion on the competition of digital networks in this book. Being regarded as an expert on Chinese telecommunications issues was an accidental thing for me. In the summer of 1998, I had the opportunity to attend a training program on infrastructure financing at the World Bank headquarters. At that time, the Peking University course ended relatively late, so by the time I arrived at the program location, the University of Maryland in Maryland, USA, on June 21, the training had already been in progress for a full week. Due to my late arrival, I didn’t really get into the content of the training. Unexpectedly, two days later, a major event in the U.S. telecommunications industry allowed me to catch up. On June 24, major media outlets worldwide almost featured the announcement of AT&T’s merger with TCI, the second-largest cable TV company in the U.S., with a total transaction value of $48 billion, on their financial front pages. Mergers and acquisitions are not new in the U.S. During my visits and studies in the U.S. from 1989 to 1996, I knew that mergers and acquisitions and spin-offs were almost a part of the daily life of American businesses, and I had long become accustomed to them. However, AT&T’s merger with TCI still remained a notable event. Everyone knew that AT&T was the undisputed leader in the U.S. telecommunications industry. In 1997, AT&T had 70 million long-distance users, 4 million wireless users, 1.1 million dial-up users, 15 million business users, and owned teleport local networks in 250 cities across the United States, with a total annual revenue of $51.32 billion. Such a global telecommunications giant, if it were to acquire any other...