China swaps out 'scum' telco bosses

Beijing has just swapped around its telco chiefs. Two have done a direct swap and the third has retired, replaced by a government official to take over the third operator.

As China’s economic management comes under global scrutiny, it’s a neat illustration of how it sees the game differently from the rest of the world.

Under the changes, Chang Xiaobing is the now chairman and party secretary at China Telecom, positions he previously held at China Unicom. Former China Telecom chief Wang Xiaochu replaces him at Unicom.

Over at China Mobile, the new man is Shang Bing, previously a vice-minister at MIIT. He replicates the path followed by retiring Xi Guohua, who moved to the operator from the MIIT in 2011, taking over as chairman in 2012.

The appointments were revealed in a series of announcements on Monday morning by the CCP Organisation Department – another key point: leadership posts in large and politically-sensitive SOEs are all CCP positions.

This isn't the first time the party has simultaneously rung the changes among the telco top tier. In 2004 it carried out a similar reshuffle in which, Unicom chairman Wang Jianzhou became China Mobile president, Shang Bing was promoted to Unicom president and China Telecom vice-president Chang Xiaobing became CU chairman and party secretary.

And why?

As a commentary in Sina Tech says, many analysts at that time thought the reshuffle would allow the chiefs to see the world through each other’s eyes and “avoid excessive competition.” Clearly the party bosses think it's been a success.

Punters think differently, however. The most popular comment under the most popular Sina story – focusing on China Mobile – declares: “You scum. All your packages are a fraud.”

The changes come on the heels of mediocre interim results. For all its dominance in 4G, China Mobile  earnings fell by nearly 1% and revenue rose just 4.9%. China Telecom’s net shrank 4% and only China Unicom showed improvement, with a 4.5% hike in income. No one is suggesting the leadership changes are intended to address any of the issues facing the three.

Final point: none of the new execs is female. All of the nine new appointees at China Mobile are male.