Re-operation of telecommunications

The cover article of Caijing: rebuilding telecom operation

"Caijing" reporter Cherijon Liu Qilin

Internet companies are marginalizing telecoms operators, who rise to the brink of a dismal record, so that the genetic effects of the system are greater than the technical genes

Since the invention of the steam engine, technology has been the core force shaping business. In our time, it is the Internet technology that triggers the business revolution. One of the greatest inventions of all time, in about 10 years, changed one industry after another: PCs, mobile phones, music, publishing, film and television, logistics, retailing, finance, telecommunications, and so on.

Last October, this newspaper focused on the impact of the Internet on the financial sector; This April, this year, the Economist saw the impact of the retail industry life and death; This period, we focus on the telecommunications industry, the former emperor daughter, Monopoly giant, now really feel the pressure of competition.

The challengers were not foreign peers such as At&t, Verizon and Vodafone, but local internet companies such as Tencent and Alibaba. Tencent's micro-letter has more than 300 million registered users, Alibaba's Alipay has 800 million registered users, Tencent and Ali are providing them with better telecommunications services and other value-added services than traditional carriers, and have been known as light carriers in the industry. They do not have a heavy base telecommunications network, but have much higher profits than traditional operators. Moreover, after the government determined no longer to protect the monopoly, the light operators will be endless, the future of the telecommunications market, is bound to be a light carrier and basic telecom operators parallel two yuan pattern.

Who will be the future leader of the telecom market?

A number of senior industry insiders to the "financial" reporter said, China Telecom, Chinese Mobile, Unicom, these former giants if you want to not be marginalized in the future, not degenerate into a simple data pipeline, we must complete their own reconstruction. What is worth pondering is that the traditional operators who have shouted for four or five years to "go to the telecom", why the transition has been slow to change? The answer is likely to be that the monopoly of resources has become a deterrent to its strength. What they lack is not technology, but new thinking, and new thinking depends on new system and mechanism.

Only by rebuilding telecom operations can the operators be rescued. As for the path of reengineering, the industry believes that both intelligent pipelines and internet companies, or both, are all possibilities.

--Editor

China Telecom Group chairman Wang in April this year to discuss cooperation matters with Ma Yun, Alibaba Group CEO Lu confirmed that the two sides in the days of cat open shop, virtual operations and Ali mobile phone operating system three aspects have reached a strategic cooperation intention.

But this does not seem like a happy partnership. In a subsequent internal meeting of China Telecom, Zhang Chengliang, deputy chief engineer of Beijing Institute of Telecommunications, said to everyone: "Ma Yun believes that the operator in addition to having a physical network, the other is dispensable." ”

Zhang Chengliang then asked, "How many applications on your mobile phone have been developed by our China Telecom?" How much do you want to download?

In the 2011, Wang has positioned China Telecom as "the new three": The leader of the intelligent pipeline, the provider of the integrated platform, the content and the application participant.

Two years have passed, and things seem to have no room to turn. In the Internet technology, China's telecommunications infrastructure operators have been forced to a corner. And the government no longer acts as an umbrella, and at the end of last year, a central leader singled out the telecoms base operators for omission. In April of this year, the Ministry of Industry was clear on the controversy over whether or not to charge for micro-letters: to the market.

June 21, "People's Daily" published an interview with Ma Yun's transcript "financial industry needs spoilers." The industry calls it meaningful. This government may increase the monopoly industry's openness to private capital, the telecommunications industry will not be immune, even the first. Previously, the Ministry of Industry has issued a notice: to allow private enterprises to lease basic telecommunications resources to provide telecommunications services.

OTT (over the top, refers to internet companies over telecommunications operators, the development of their own data services, such as micro-letter) This term, has been unable to summarize the social functions of Internet enterprises. Through a single product application, OTT manufacturers have formed their own cycle of biosphere. Once users enter the biosphere, they can meet the needs of daily life, such as trading, payment, friends, microcredit and so on.

Some OTT manufacturers have been known as light carriers in the industry. The so-called light carrier, refers to those who provide users with voice and a variety of data services (including financial services), but do not have basic telecommunications facilities enterprises. Such enterprises are more private enterprises.

Most of the insiders interviewed by the "financial" reporters believe that after the government removed the umbrella, the basic telecommunications operators and light operators in parallel to the two-yuan market pattern will be irreversible, the future is to see how the basic telecom operators, light operators will dominate the telecommunications industry.

This is the elimination of the Long

The voices and signs of Alibaba and Tencent, the future leader of telecoms, are undoubtedly the nightmare of China's three telecoms operators

While Mr Ma enjoyed the thrill of a quarterly net profit of nearly twice-fold growth, China's basic telecoms operators ' growth in revenue and net profits fell every year (see table).

One of the important reasons for the fall is the substitution of OTT business for voice and SMS. According to the Ministry of Statistics, January-March, the national mobile phone calls grew 6.3% year-on-year, but the growth rate of mobile phone users is 12.5%, which means that the user's phone time significantly reduced. According to the Ministry of Information, China's mobile phone users have reached 1.146 billion households, penetration rate of 84.9%, the space for continued growth has been very limited.

The more prosperous the mobile market is, the more desolate the basic telecom operators will be. Li, president of China Mobile, said that China Mobile had previously measured, if a mobile phone users to send 1000 text messages, China Mobile can receive 100 yuan, if he sent the 1000 messages with micro-letter, China Mobile can get the flow fee may only a few dollars.

At present, the number of micro-credit is approaching 400 million, which is equivalent to the mobile users of China Unicom and Chinese Telecom. 2012, Tencent's net profit margin is 28.09%, Mobile is 23.07%, China Telecom and Unicom respectively only 5.27% and 2.85%.

There are more people laughing than Tencent. Ma Yun can also give Li account: Taobao and the cat has about 500 million registered users, Alipay has 800 million users, the mobile phone Taobao has 300 million users, this and a carrier has no two, a mobile user to open a page to achieve a transaction (E-commerce or financial management, etc.), just dozens of KB of data traffic, The process is only a few cents to the operator, and Alibaba earns no ceilings.

In the 2012 fiscal year (October 2011 to September 2012), Alibaba Group revenue of 4.083 billion U.S. dollars, an increase of 74%, operating profit of 688 million U.S. dollars, an increase of 112% year-on-year, net profit of 536 million U.S. dollars, the year-on-year increase of 58%.

Micro-trust in the past only the impact of voice, SMS and other stock business, Alibaba based on cloud computing, large data technology, will be operators of mobile value-added services impact.

Alibaba is constantly acquiring or strategic stake in a variety of applications, such as shrimp music, Sina Weibo, the gold map, and even outbound acquisition of video site PPLive News. This means that Alibaba can provide a variety of mobile value-added services for its 300 million or 500 million or 800 million or even more users.

The future of micro-letters is the same. But compared with the micro-letter, Alibaba still lacks a more sticky mobile entrance, because Taobao users, may only go to watercress to listen to music, it is bad. So Alibaba is trying to get the most direct access to the phone through cooperation with operators.

Alibaba is vigorously promoting its mobile operating system Aliyun OS, with its own huge online traffic platform to attract handset manufacturers to join, and hope that operators to provide these Aliyun OS mobile phone more subsidies.

In the April negotiations, Ma Yun told Wang: "Customers use Alipay" Credit payment, you can realize the real 0 yuan purchase, and then each month to pay Alipay payment package. and the current market "0 yuan purchase", all need to deposit a certain amount of money, and then return monthly.

The plan will completely subvert the traditional mobile communications business sales model, the implementation of mobile phone cards nationwide Unified management, unified pricing, unified services, this is the operator since 2008 the entire business operation, how to do a bad thing.

Do basic telecom operators think that the transition to "telecoms" has been going on for years, and why is it unsuccessful? Will the light operating model of Ali and Tencent dominate the future?

The War of transformation

You have not finished the approval process, others have made the product, this situation continues, the telecommunications operators of the Internet transformation must be passive

In the early hours of June 22, China Mobile issued a statement on the official website of Jego (ethically easy go), suspending the product's new customer registration and shutting down the audio and video telephony functions of mainland Chinese customers in mainland China.

Jego, known as the "Chicken Dog" within China Mobile, officially launched on June 1, offering users instant messaging, instant voice messaging, photo sharing, video communications, and even a landline (overseas), similar to Skype and micro-trust software.

The prototype is the PTT (Push to Talk) business, which was launched in Beijing many years ago, and can be as fast as "one-to-one" or "one-to-many" calls, which served the 2008 Beijing Olympic Games. Since then, the China Mobile Research Institute has been a team of 2-3 people to promote the development of the business, the Chinese mobile Data department Internet office has also been involved in the development of some of these modules.

However, ultimately by China Mobile international Company on its basis, through the outsourcing team operation, rather than China Mobile group unified release. Because the international company has the big project approval authority, the China Mobile Research Institute and the data department did not know Jego's launch.

In an interview with Caijing, the head of China Mobile's comprehensive department said that it did cause "contradictions" and "wars" between the institute and international Companies in China Mobile, which is why Jego eventually died at home.

Jego has been hailed as a starting point for operators to find a place to live after being marginalized by mobile internet companies, but is still constrained by China Mobile's rigid system and mechanism. More crucially, such events are not uncommon.

After Jego, China Mobile recently also unexpectedly abandoned the previous painstaking years, carrying huge mobile internet strategic significance of flying fly and chat.

Since 2009, the industry called the operators "to strive for" the era. Within the three major operators have formed a clear strategic transformation plan, namely: clear to be the leader of the intelligent pipeline, as well as content and application of the participants. During the transition to the Internet, various initiatives have sprung up.

China Mobile is the most typical. It continued the 2G Mobile Dream Network era of industrial chain ideas, trying to build similar Apple App Store, such as the App Store, and the development of its own ophone mobile phone operating system, hoping to form a mobile Internet portal, through app applications, terminals, services, channels, The formation of a natural advantage of the mobile Internet eco-industrial chain.

Theoretically, due to the natural user base and network foundation of telecom operators, this idea is operable. The reality is exactly the opposite. OPhone quickly withdrew from the market shortly after it was published in 2011. Flying, mm cloud, Internet of Things, e-commerce, location services, flying letter, voice cloud and mobile payment services, are difficult to form a competitive advantage in similar markets.

In the mobile payment field, China Mobile also chose to abandon its 2.4G mobile payment standard and switch to NFC (short-range wireless communication technology) camp. The NFC mobile payment SIM card was launched in conjunction with China UnionPay, and a joint development of the "mobile wallet" was released. But the current market for NFC-enabled handsets are very few, the development of users in a short time is not realistic.

China Telecom and China Unicom have almost duplicated the embarrassment of Chinese mobility in the Internet strategy. After the launch of the MM application Mall in China Mobile, China Telecom and Unicom also launched the Sky Wing App Store and wo store, and layout a variety of mobile internet business, these products, in addition to the sky-wing video and other small businesses, few people can remember.

"Unicom has done a lot of internet applications, such as friends, although we use, but all know experience is very poor, unstable, not smooth, ineffective." A Beijing Unicom employee told Caijing reporter. Sumitomo is China Unicom's self-developed mobile software, but according to undisclosed data, since August 2011, the number of active users is only about 2 million.

In the interview, many operators insiders believe that the traditional system problems caused its Internet applications can not get the necessary development vitality.

"Others are light, operators are carrying 100 kg of bags with them to race, so the transformation of seven or eight years also did not change!" China Telecom Company Science and Technology Committee director Wei heartfelt regrets. Over the years, the Chinese Academy of Engineering, the former chief engineer of China Telecom has been committed to the transformation of the operator research, but in the interview with Caijing reporter, he is not optimistic about the prospects of Internet operators.

A partner of China Telecom's wing payment company says they are unable to adapt to the operator's "style" until now. In the past year, in order to find business opportunities in this independent telecoms operator's subsidiary, he often stayed in the company for a whole day.

"In the communication of new ideas, the other side often said the word is ' do not innovate!" in the existing technology framework. "The partners explain that the wing payment company's business development needs are submitted by the business unit, while development is the responsibility of the development Department, if the marketing department has new ideas and ideas, need to submit a written application, research and Development Department in accordance with the requirements level development."

"A small creative function, such as the payment in the wings of the interface to load a share on the return of the function, fast it takes three months, slow six months will not finish." "And the partner's Internet company partner, the same thing," the internet company quickly said one night to complete it.

Similar "big business disease" is very common within the three major carriers. For example, China Mobile's flying letter has been tied by the system, by micro-letters easily squeezed competition queue.

China Mobile in 2007, the development of flying letter business, has been aware of its own system defects, then will be the flying team split listed, the establishment of Shenzhou Thai Yue Company. But the surface independent of the Shenzhou Tai Yue, in fact still subject to many, its business, operation, promotion of China Mobile as much as dozens of departments, which makes the flying letter business Research and development and marketing gap between the long-term.

Some people in the industry to the "financial" reporter disclosed an unconfirmed data, flying five years of research and development cost hundreds of millions of yuan, this figure does not include the direct management of the business of China Mobile internet base costs, as well as the promotion of flying charges.

This problem is common among a range of subsidiaries established by telecom operators. Wei said, "You have not finished the approval process, people have already made the product, this situation continues, the telecommunications operators of the Internet transformation will inevitably fail." ”

The rise of light carriers

From the app Store, micro-mail, mobile Taobao, Alipay, such as mobile Access, is a nearly enough to meet people's food and clothing to live with all the needs of the mobile society, where the carrier is only a data pipeline

The traditional telecoms giants are on the move, but the light carriers are booming.

June 6, the Guangzhou Public Security Bureau launched a micro-trust, the provision of 46 kinds of services, mainly including vehicle management, entry and exit document processing. Members of the public are advised to check their own vehicle records by making an appointment for passports, line-signing and so on. Guangzhou Municipal Public Security Bureau Command Center Publicity department deputy director of Zhang Shenchun in the "financial" reporter interviewed said, micro-letter public number greatly saves the self-service need to invest in police, material.

Similar to the "Guangzhou Public Security" micro-letter public number also, China Merchants Bank, Southern Airlines, the National Museum, Guangzhou Public Security, all small.

At present, the user can through the micro-letter "China Merchants Bank" public number, check the credit card balance amount, billing information, and through this public number to receive the micro-letter notice of consumption. The SMS service of China Merchants Bank is only for the consumption of more than 100 yuan.

South Airlines public number in charge of Chu Wenhui to the "financial" reporter said, the current South Airlines public number can be realized query, change the signature function. Once the micro-letter has introduced the payment function, the ticket can be booked through the public number. In the future, the South Airlines public plan to achieve high-end passenger butler, passenger community, Pearl Mall (South Airlines points to redeem the site) and other functions.

When the user uses the voice input, the public number can also through the speech recognition, transforms it to the text, then by the backstage carries on the automatic processing. This public number has in fact partially replaced the call center function of the inhuman service.

Chu Wenhui that, compared with the SMS platform, micro-letter has interactive, social functions, conducive to maintaining customer relations, in terms of tariffs, information can be issued by the PC, almost for free, and SMS platform, you need to pay service costs to operators.

The image of micro-letter integration into traditional commerce has not yet reached its end. In early July, Tencent is about to release the micro-letter 5.0 version. This version, in addition to the two-dimensional code, can be "swept" the scope of a large expansion: bar code, book or CD cover scan, as well as by Tencent Soso Map Support Street View scan. This means that micro-letters can scan the goods for online shopping, but also scan buildings to identify roads and directions.

Like Google Glass, micro-letters will free users from the keyboard and become a huge information portal and platform. From this entrance, it will be an all-encompassing mobile society. Here, the service provider is Tencent, the basic telecom operators will be completely reduced to data pipelines.

The micro-letter only opens up the corner of future innovation. In the smartphone, people can basically use the application software to solve all the food and clothing to live with the line: The public comments, Baidu map, drop a taxi, cell phone Jingdong, wireless Ctrip and so on. Ten years ago, these requirements can only be achieved through the mobile dream network of telecom operators, 12580, all the numbers, 114, etc. Today's apps are either free, paid for trial at Apple's App Store, or paid for by the associated other payment paths, and have nothing to do with operators.

Ma has said in several private cases that Tencent does not need a virtual operator license. Tencent, unlike Alibaba, already has an enviable mobile portal. Of course, the first Internet company that dares to say "no" to operators is Apple.

Before the iphone was released, Apple had considered turning itself into a mobile virtual network operator. A patent filed by Apple in 2006 suggests that Apple's mobile virtual network operations center could be a real-time communications hub similar to itunes, which displays parameters such as the signal strength of different carrier networks based on the location of the iphone and real-time network conditions. The user can then click to select the most appropriate operator network access.

According to Apple's original vision, although users may be using more than one operator's network at the same time, only to the Apple "mobile virtual network operators" pay the phone. Even now, Apple's vision is very advanced. However, in the second year of the patent application, Apple launched its first iphone and rewrote the industry's rules through its pioneering app store model and cloud services. The App Store model has made Apple build a complete ecosystem of operators, with terminals, platforms, content services, and billing channels, in addition to the flow requirements.

APP Store, micro-letter, mobile phone Taobao, Alipay, etc. are the gateway to mobile society. It can be expected that there will be more and more such entrances in the future. Emerging wearable devices such as Google Glass, Apple Watch iwatch, and sports bracelet are another form of narrow door. 4G after the climate is formed, more portals will emerge, such as video clients.

Li, China Mobile's president, said last year at the China Mobile Global Developers Conference that 4G: it could take a day or two to download a 700M movie, and only 2 minutes on a bus in Hangzhou, where the 4G experimental network was built. So in the 4G era, high-definition video can be moved to the car, that is, in the car to participate in the company's television high-definition conference.

China Mobile's determination to build 4G has been notoriously hard to establish. But where are their own mobile portals? At a time when it was not allowed to enter the door, light carriers were more ambitious than the entrance.

According to "Caijing" reporter understand, in Google successfully for the United States Kansas City part of the family to provide broadband operating services, Alibaba, Tencent, Baidu and other enterprises have begun to layout their backbone network (used to connect LAN or regional network). At present, the Chinese government has not liberalized the construction of the backbone network, that is, connecting provinces and provinces, countries and countries, cities and cities.

Take Baidu for example, after about five years of upgrade and optimization, Baidu's backbone network has TB (1TB=1024GB)-level flow capacity, can connect Baidu North China, east China, the international three large area of data center group, each large area has a number of tens of thousands of servers bearing the size of the single data center. This June, ZTE also announced that Alibaba in Beijing, Hangzhou, Tianjin three building backbone network.

The layout of basic telecommunications facilities will enable light operators to be more proactive in data transmission. In turn, the stability of traditional telecom operators ' fiber and super bandwidth becomes the bottleneck of their further upgrading. Recently, it has been reported that micro-credit internal testing has been able to achieve continuous voice calls. The light operators become the actual operators, only in the line between the policy.

Most of the insiders interviewed by the "financial" reporters believe that if the basic telecommunications operators in the 4G did not plan in a timely manner supporting the data Services strategy, then the fate of its marginalization will be irreversible.

A new choice.

It will be the only way for the three operators to make the Internet products, which is completely independent of the existing system.

In April this year, China Unicom and Sohu Video announced deep cooperation, in the country 31 provinces and cities successively launched 15 yuan 6GB video directional flow package. The two sides take the divided pattern to realize their profits. There are rumors that China Unicom to change the normal from each package fee to Sohu to pay an unknown proportion of the share.

and unicom to achieve such cooperation OTT manufacturers also include micro-letter, sing bar, watercress, shrimp music, such as well-known application manufacturers. Sing it. With China Unicom also launched a monthly subscription service, the standard fee is also 15 yuan/month. Watercress, shrimp music, and China Unicom has also cooperated with a single monthly flow of business, the cost of about 5 yuan.

"If the application vendor can divide 55 with the operator, it is an ideal state." One developer told Caijing. Abroad, this mode of cooperation is already widespread. For a single application product to do directional flow package, and separate charge mode, to a certain extent to achieve the pipeline intelligent management, greatly enhance the value of the pipeline. However, a senior person in Tianjin Unicom told Caijing reporter, this model is still a small range of exploratory mode, with the OTT manufacturers of cooperation, but also need to expand the idea, increase imagination.

A number of operators insiders to the "financial" reporter that the operator has initially formed a consensus on the OTT manufacturers: through cooperation, to obtain the corresponding flow value added. That means telecoms operators no longer stand on the same track as internet companies.

A person close to China Mobile's decision-making level said that more than 90% of the value of operators are still in the pipeline, based on the unique value of the pipeline to explore new business, new users, new models, is the operator of "the root of the settlement." Wei also believes that the pipeline is still the operator of the "golden", "to the telecommunications is right, but completely give up the pipeline, to do the Internet is impossible." At this stage, between the Internet enterprise and the intelligent pipeline, the operator temporary choice is the latter, then timing to the former erosion.

In fact, there is no successful Internet product case within the operator.

2011, China Telecom "Sky Wing video" business team stripped from the parent company to achieve the independent operation of the company. 2012, the sky-wing video annual profit of nearly 1 billion yuan, the user scale of more than 80 million, in the same video business ranked fifth.

Sky Wing video is the predecessor of China Telecom's video Operations center, 2010 Business Online, 2011-Day Wing video company was set up, and in 2012 to complete the first round of restructuring private placement, China Telecom to sell 20% equity.

Wei that, "Sky Wing video" Business, is China Telecom a few successful internet business. The success of "Sky Wing video" lies in the separation from the old system of operators.

According to Wei, the next step, the sky Wing video will further transfer of equity, "hope that the community's investment continues to increase, China Telecom's holding down to 50%, and ultimately not by China Telecom Holdings, but as a social company running."

The company will have a promising business operation, completely independent of the existing system, is considered to be the three major operators to do Internet products the only way.

China Telecom after the sky-wing video, August 2012 will be "Love Game" base officially into the operation of the company, and set up a colorful interactive Network Technology Co., Ltd. in the game business investment, acquisition, product development and marketing and other aspects of self-financing.

According to China Telecom's planning, its eight major business bases will be operated by the company.

China Mobile is also exploring the route of the base company. Last year, China Mobile's president, Li, had a high-profile announcement that it was brewing internet companies, with a specific plan to take the lead from the Guangdong Mobile Base, transform the original Internet base into an internet company and have its own board, and then split the other eight bases from the provincial companies. Li even said there was a possibility of setting up multiple Internet companies.

China Mobile business base in the provincial companies, the assessment of the base is: Quarterly, headquarters data and related departments have 50% weights, the provincial companies have 50% weights. If according to Li Planning, this will be a thorough comb China Mobile Corporation, provincial branch, business base of the interests of the big move between the three. It is unclear, however, whether any progress has been made so far.

Recently, China Unicom will be information Division and E-commerce Department of the merger, the new establishment of "information and E-commerce division." Beijing Unicom Marketing Department related sources said, this is likely to be separate electronic channels, the establishment of an independent subsidiary of the preparatory stage.

Wei optimistic that, after a decade, through the transformation of operators, the pipeline business and the Internet business income ratio may be reached "each accounted for 50%". His view is that operators do well in a few internet businesses.

He believes that the rise of light operators, represented by Apple, Tencent and Alibaba, will rewrite the industry pattern, leading higher-margin business and applications, the basic telecom operators of the pipeline, marginalization, low value trend is difficult to reverse, this is not the operator's "careless underestimate", but the general trend.

There are signs that policymakers want policy guidance to help operators lift pipeline value and tap into more pipeline space, and that telecoms will be more open. In the activation of traditional operators, private capital has been placed high expectations.

Industry insiders expect that the movement of people into mobile resale business is probably only the first step, the next stage, the basic telecommunications operating areas may be more open, for example, LTE network construction and operation, the possibility of introducing private capital is not.