Private firms in China can now share a slice of the country's lucrative telecom market. 11 lucky companies--including leading e-commerce firm JD.com--have gotten the first virtual telecom operator licenses.
China has 1.15 billion mobile users and only three major mobile operators.
That could soon change.
11 private firms are getting the green light to run basic mobile services, such as voice calls, text and picture messages and data base.
And they are going to achieve this by hiring facilities from the "big three" State-owned carriers--China Telecom, China Mobile, China Unicom.
This is part of the pilot program introduced by the Ministry of Industry and Information Technology six months ago. It reinforces the monopoly sector reforms promised by the CPC Third Plenum.
The rules stipulate that the three telecom majors must lease their networks to at least two private firms. And the quality of the network must be equal to their own.
"The ministry will set aside a specific batch of numbers starting with 170 dedicated to the rental service. There would be discount prices to private firms who want to hire our bandwidth. This would give some space for these firms to grow," Cao Shumin, Director of China Academy of Telecommunication Research of MIIT, says.
The stakes are huge. China's telecom market is the biggest in the world, worth nearly 1 trillion yuan this year. Mobile communication is the fastest growing segment. More players could spell savings for consumers who at the moment complain about high prices and not enough choice in operators.