EU looks to China to part invest Euro 315 b in telecoms sector
Saturday, 7 February 2015 00:00
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Reuters: The European Union is looking to Chinese companies such as telecom equipment maker ZTE and Bank of China to take part in its € 315 billion (236 billion pound) investment plan to revitalise the bloc’s stagnant economy.
Executives from Chinese and European companies, including Finnish mobile games maker Rovio and China Mobile, met senior European Commission officials this week to explore greater cooperation in the hi-tech and telecoms sectors.
The Commission’s investment plan is designed to attract private money to improve infrastructure across the transport, telecoms and digital sectors and so not add to already high levels of public debt.
The two sides agreed to encourage Chinese investments in European digital infrastructure through joint ventures and public-private partnerships, ChinaEU, the business association that organised the meeting, said in a statement on Thursday.
Representatives from Bank of China, China’s largest telecom carrier China Mobile and Bank of America Merrill Lynch were also present, according to people at the meeting.
The company executives met separately with EU foreign affairs chief Federica Mogherini, Jyrki Katainen, who is responsible for employment and growth, and Andrus Ansip, tasked with overseeing the creation of a digital single market.
The new European Commission led by Jean-Claude Juncker in November launched an ambitious plan to turn € 21 billion in existing EU and European Investment Bank funds into € 315 billion in project funding.
The participants agreed to cooperate ahead of the next EU-China summit in June in the development of the next generation of mobile technology, so-called 5G, which would enable a one-hour video to be downloaded in six seconds.
Once a leader in GSM technology - the original standard for mobile networks - in the 1990s, Europe has fallen behind the United States, Japan and South Korea in the roll-out of the current standard of fast mobile networks, known as 4G.
“China and the EU should leverage their technological and market strengths collaboratively, and thus establish a major strategic presence in the future 5G mobile markets globally,” ChinaEU said.
The Commission has already teamed up with South Korea - which has one of the fastest mobile broadband networks in the world - to jointly research 5G and set a timetable for its roll-out.
A similar partnership between China and the EU in the development of 5G standards could be envisaged, said one of the participants of the meeting.
China’s internet population hits 649 m, 86% on phones
Reuters: China had 649 million internet users by the end of 2014, with 557 million of those using handsets to go online, said a government report on Tuesday, as the world’s biggest smartphone market continues its shift to mobile.
While growth is slowing, China’s total internet population still rose by 31 million in 2014, said the report by the China Internet Network Information Centre (CNNIC).
Growth in mobile internet users was faster, at 57 million.
Riding this wave are some of China’s, and the world’s, biggest technology companies. These include e-commerce groups Alibaba and JD.com Inc, social networking and video games firm Tencent Holdings Ltd, search giant Baidu Inc and smartphone maker Xiaomi Inc.
For these companies a huge part of China’s potential remains untapped, much of it in smaller cities and rural areas. The country’s internet penetration rate is 47.9% and rural users only account for just over a quarter of China’s total, said the CNNIC. By comparison, in the United States 74.4% of households reported internet use in 2013, according to the United States Census Bureau.
In good news for Alibaba and JD.com people shopping online increased by 20% in the year to the end of 2014. Users of online payment services, operated by Alibaba and Tencent, increased by 17%. Instant messaging, which is dominated by Tencent’s WeChat and QQ, saw users increase by 10%.
However, microblog use, a market dominated in China by Weibo Corp, was down 11%. Last year, CNNIC reported a 9% decline in users, triggering a sell-off in shares of the then-unlisted company’s parent, Sina Corp.
But smartphone sales are flagging. Shipments in China were 389 million phones in 2014, down from 423 million the previous year, according to China’s Ministry of Industry and Information Technology.
Foreign internet companies have also been denied an opportunity to compete in China. Some of the world’s biggest online services, like those run by Google Inc, Facebook Inc and Twitter Inc have been severely disrupted or simply blocked.
Nevertheless, domestic tech firms have weathered regulatory scrutiny and the onus of self-censorship to account for more than $ 600 billion in total share market values.
