Chinese operators form telecoms tower firm

Chinese operators form telecoms tower firm

China’s three state-owned mobile operators have signed an agreement to form a joint telecoms tower company.

China Mobile, China Unicom and China Telecom will hold 40%, 30.1% and 29.9% respectively in the new venture, and the operators expect it to have a registered capital of $1.6 billion.

Named China Communications Facilities Services Corporation, the tower company will focus on the construction, maintenance and operation of telecoms towers.

With the ever-increasing demand for 4G services, and the costly roll-out of LTE networks, the three operators decided that a joint infrastructure company could reduce individual cost and allow for tower sharing, as well as increase network coverage and quality.

“We believe this will be a net positive for all three operators, and will likely result in lower future capex for Telecom and Unicom and possibly new revenue streams for China Mobile, as it sells or rents access to its towers,” Chris Lane, analyst at Sanford C Bernstein, said in a research note.

In statements, China Unicom and China Mobile said that they expected the new venture to reduce duplication and redundant construction of telecoms towers and related telecoms infrastructure.

Talks over the China Communications Facilities Services Corporation were first revealed in May this year.