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BEIJING, Jan 31 (CEIS): China's two basic fixed telecom operators, China Telecom Co, Ltd (NYSE: CHA) and China Netcom Co, Ltd (NYSE: CN) are making every effort to fight against the trend of FMS (Fixed Mobile Substitution) by advocating broadband services.
According to Analysts, an Internet-based business information service provider, the two companies will cut charges to attract customers back to their broadband access service, broadband TV service and VOD (Video on Demand) service.
Analysts says that many customers would not like to abandon Internet broadband access services provided by fixed telecom operators, though they no longer need the fixed call service.
FMS has been getting momentum in China. In the first 11 months of 2005, the number of fixed phone users in the country increased by 39.041 million to reach 350.797 million, while the number of mobile phone users increased at a much faster clip by 53.337 million to hit 388.161 million, though the number of mobile phone users has already surpassed that of fixed phone users.
Besides, the volume of local fixed phone calls in the period rose by a moderate 0.1 per cent only in the 11 months, while the call duration of local mobile phone calls in the same period soared 33.9 per cent year on year.
China's Ministry of Information Industry has projected that the number of newly added mobile phone subscribers and fixed phone subscribers will be 48 million and 30 million respectively in 2006, further indicating the trend of substituting fixed calls by mobile calls.
Meanwhile, broadband service became the only growth area of China Telecom in the period, posting a revenue surge of 29.3 per cent year on year.
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