SARFT plots $32b cable network to take on telcos

An update on China’s telecom vs. cable saga.

The Economic Observer reports that State Council is weighing a plan from SARFT proposing a national cable company with 200 billion yuan ($32bn) in network and content assets.

It’s the second attempt this year by the broadcast regulator at creating a nationwide cable giant.

The first plan, calling for a state-owned company comprising all provincial level network assets, was rejected because it was not under the control of asset regulator SASAC as large SOEs are supposed to be.

The current modest proposal puts the company under SASAC, but retains a role for SARFT as content regulator.

The new firm would seek an initial 10 billion yuan investment from the central government, aiming to build a company structure which could progressively soak up the provincial assets.

It’s the latest in a long and so-far fruitless saga. SARFT, the government and successive telecom ministries have been butting heads over this since the late 1990s.

Early last year State Council ordered the ministries to break the logjam, but aside from a handful of trials, some resulting in legal action, little has happened since.

Even if the turf war could be solved, the practical difficulties of creating a national cable firm are immense. The dozens of network operators each use their own technology standards and many of them have high levels of debt.