China Mobile reveals new strategy to combat pressures - Mobile World Live

China Mobile reveals new strategy to combat pressures

20 JUN 2012

LIVE FROM GSMA MOBILE ASIA EXPO 2012: China Mobile chairman Xi Guohua believes the operator can overcome the major challenges being faced by carriers in today’s mobile industry by focusing on cloud computing, faster network technology, the ‘Internet of Things’ and its Wireless City initiatives.

Xi Guohua opened his keynote presentation this morning by admitting that operators are facing huge pressure: “The value chain is changing. In the past the value chain was dominated by operators, but now it’s operators, device manufacturers, content providers and everyone is taking a great role in this value chain. The ranking of operators in the FTSE 500 is dropping, while others are improving.”

The major challenges facing China Mobile include “ever-increasing network pressure,” with Xi Guohua stating that last year saw mobile data levels on its network increase by 70 percent, a figure expected to increase to more than 150 percent this year. “While data traffic has brought income for operators, they then have to invest in the network, so we have to strike a delicate balance,” he said.

Other challenges include overcoming the perception that operators are simply ‘dumb pipe’ providers, and embracing the fact that the traditional telco business model is facing competitive threats. “Operators are very good at providing stable services, but the Internet business is characterised by faster cycles and agile developments. The traditional business model and strength of operators has therefore become a constraint in the new business world.”

Despite these obstacles, Xi Guohua noted that industry growth will create “big opportunities” for operators, fuelled by a 2.1 billion mobile Internet customer base by 2015 driving CAGR of 24 percent. And key to China Mobile taking maximium advantage of this growth will be a focus on cloud computing and the Internet of Things: “In the next two years more than 3.5 billion industrial product units will be connected via Internet and mobile communication. Users of internet of things for China Mobile has been increasing at 60 percent.”

Xi Guohua also talked up its ‘Wireless City’ initiative, as well as its move to TD-LTE technology. The company plans to deploy 20,000 TD-LTE base stations in 13 cities by end of this year and China Mobile’s CEO said it is “very likely” this target will be expanded. “Now the device wait is the bottleneck,” he admitted, before urging the industry to continue work on converging TDD/FDD standards.

Closing his presentation, Xi Guohua stated that today’s mobile industry poses both challenges and opportunities for operators. “We need to transform the business model, innovate and develop new markets,” he said. “At China Mobile our strategy is smart pipes, plus open platforms, plus user-friendly interfaces, plus unique services.”


Justin Springham

Justin manages the editorial content for the Mobile World Live portal and award-winning Mobile World Live TV service. In the last few years Justin has launched and grown a portfolio of premier media products, which include the Mobile World Congress...

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