STATE-OWNED COMPANIES COMPETE TO ROLL OUT 4G
The telecom providers category declined 1 percent in value in the BrandZTM Top 100 Most Valuable Chinese Brands 2016. China Mobile, the category leader, grew 2 percent in value. The other two providers, China Telecom and China Unicom, declined 9 percent and 14 percent respectively.
Factors contributing to the weak brand value performance of these State Owned Enterprises (SOEs) include the impact of slowed economic growth, stock market fluctuation, and the ongoing shift to market-driven rather than state-owned brands, as Internet brand leaders attract customers to services that bypass the telecom networks.
The telecom providers also experienced pressure on profits as they invested in rolling out 4G and reduced pricing, in response to government desire to increase data transmission speed and lower fees. Market leader China Mobile planned to accelerate roll out of 4G, doubling the number of 4G users it had at the end of 2015, to reach 500 million users in 2016.
In a collaborative effort to compete more effectively against China Mobile, China Unicom and China Telecom announced plans to collaborate on building 4G infrastructure and providing overseas roaming services. In addition, they advocated for smartphone devices that supported six different technologies, making it easier for people to switch carriers.
China is moving towards the integration of Internet, TV, and telecommunication. Unlike in the West, where competing brand ecosystems drive the process, in China the integration is government planned. The telecom providers also supported the government’s Internet+ e ort to connect mobile Internet, big data, cloud computing and the Internet of Things