Broadband China 2014 Special Action Scales Down FTTH Target: China Mobile May Become a Driving Force

On the afternoon of March 21 (Yue Ming), the mobilization and deployment teleconference for the "Broadband China 2014 Special Action" was held in Beijing today.

Attendees included MIIT Minister Miao Wei, Vice Minister Shang Bing, China Telecom's Wang Xiaochu, China Unicom's Chang Xiaobing, China Mobile's Li Zhengmao, and Wu Hequan, an academician of the Chinese Academy of Engineering. The conference defined the overall goals of the "Broadband China 2014 Special Action": adding FTTH coverage to more than 30 million households, deploying 300,000 new TD-LTE base stations, adding more than 25 million new fixed broadband internet users, adding 30 million new TD-LTE users, bringing broadband to 13,800 new administrative villages, and having users of 8M and above broadband access products exceed 30%.

By comparing with the "Broadband China 2013 Special Action," we can see that MIIT has begun to lower the target for new FTTH-covered households. Last year, the target was 35 million households, while this year it is 30 million.

As the primary builders of FTTH, China Telecom and China Unicom have both begun to reduce fixed-line network investment. Wei Leping, director of China Telecom's Science and Technology Committee, previously stated that China Telecom would reduce fixed-line investment by 50% this year to focus fully on LTE network construction.

At the end of last year, MIIT officially granted China Mobile a fixed-line network license. Industry insiders believe that, given China Mobile's substantial financial resources, its investment in FTTH can effectively compensate for the investment decline of China Telecom and China Unicom. In the just-started 2014 optical splitter centralized procurement by China Mobile, such a change is already visible: its procurement volume in 2012 was less than 200,000 units, while this year it exceeds 2 million sets.