Thursday, November 10, 2011

Irony: Perhaps the Chinese can bring competition to the US wireless market

The US Congress tried unsuccessfully to introduce competition into our telecommunication industry with the passage of the 1996 Telecommunication Act. Congress and the FCC were no match for the incumbent telephone companies with their lobbyists and legal staffs, and their efforts were defeated.

Might the Chinese have a better chance than the US Congress and FCC?

China Telecom intends to enter the US market as a "virtual" mobile network operator. They will partner with a US carrier and plan to sell handsets and services to Chinese Americans and to students and tourists who travel regularly between the US and China.

Donald Tan, president of China Telecom Americas, said they may even consider building or buying their own wireless network in the US -- "If the service is growing fast, maybe we can set up our own infrastructure. The money is no big problem for us."

Of course bastions of capitalism like AT&T and Verizon will do their best to stop Chinese competition. This was foreshadowed last month, when the US Department of Commerce excluded Huawei from bidding on a national emergency network project.