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China Satellite enters Chinese telecom fray
( 2001-11-07 09:48 ) (1 )

The country's seventh telecom carrier which will use satellites to transmit calls and messages will be launched by the end of the year.

China Satellite Communications Corp will incorporate all the satellite arms of the current players in the telecoms market.

At a high ranking conference on Monday, the team masterminding the fledgling company was announced.

Zhou Zehe, the present head of ChinaSat -- a major component of the new company -- was named president. And other five people were named vice-presidents.

Major components include ChinaSat (Hong Kong), Zhongyu Satellite Mobile Communications Co, China Orient Telecom Satellite Co and China Post Translation Service Co. The long-awaited company is the last among the seven basic carriers to make its debut.

"China Satellite Communications Corp will face severe challenges and competition after China enters the World Trade Organization," said Zhang Chunjiang, vice-minister of the Ministry of Information Industry (MII).

Satellite -- one of the major communications devices -- has not been fully utilized in China's telecom sector.

Most of the country's satellite capacity is used to transmit TV programmes instead of telecom signals.

Zhang said the new company should better use its satellite capability to make it one of the major contributors to the telecom industry.

The new company has gained a licence to provide Internet access and telephony services on the web, expanding its business coverage.

The launch of the company is part of the industry reorganization of China's telecom sector when the seven basic telecom carriers are to be reorganized into six.

The MII is busy making detailed asset reorganization and staff arrangement for this round of reform. The detailed plans are to be released as soon as possible.

The announcement comes at a crucial time as the country is expected to enter the WTO by the end of the week. China's telecom sector, the biggest contributor to the economy, has been regarded by foreign companies as one of the key sectors for fast growth.

Hughes, one of the biggest satellite service providers, opened its Chinese subsidiary company in mid-October.

The US-based satellite firm is not satisfied with the TV signal transmission as it wishes to enter China's telecom business after WTO, according to Michael Sun, general manager of Hughes (China).

Satellite's advantages lie in its ability to transmit signals from one point to several.