Takeover to give technological edge
Peoples says deal with China Mobile enhances its chances
China Resources Peoples Telephone expects its parent-subsidiary relationship with China Mobile to provide a technology edge as it looks to expanding its partnership with the mainland mobile giant.
With the acquisition deal slated for closing by the end of this month, chief executive Charles Henshaw says Peoples Telephone is likely keep its brand name. He says the company will also explore new services with its new parent to benefit from the stronger research resources of China Mobile.
'Hopefully, China Mobile would give us an edge on technology and we'd work closely with them,' said Mr Henshaw. The company is scheduled for delisting by the end of this month. Commenting for the first time on the $3.38 billion takeover, Mr Henshaw said the key difference between its previous parent, China Resources Holdings and the new parent was that China Mobile was likely to give Peoples Telephone new technology while China Resources was a pure holding company.
'There are certainly things we can learn and experience we can share from [China Mobile's operations] in other provinces of China. We expect to be asked to join their meetings,' said Mr Henshaw.
Meanwhile, as CSL is buying New World Mobile in a deal scheduled for shareholders' approval in the next two months, Peoples would be left as the only mobile operator without a 3G network.
The other three 3G mobile operators are PCCW Mobile, Hutchison Telecom and SmarTone. China Mobile is also expected to be given a 3G licence this year.
Mr Henshaw said he did not feel disadvantaged by the lack of a 3G licence. He said if China Mobile decided that Peoples should enter the 3G fray, it would lease other players' 3G network capacity and become a 'mobile virtual network operator'.
Peoples, which had a net profit of $178 million for the first nine months last year, has always been perceived as a low-cost mobile operator targeting users who care more about value for money and than technology. A technology partnership with China Mobile could give it an edge.
One example of such a technology partnership is mobile instant messaging (IM), Mr Henshaw said.
He said China Mobile and Peoples were looking at IM and China Mobile was working with other giants such as Vodafone - its shareholder with a 3 per cent stake - to ensure they use the same platform so their respective mobile IM users could talk with each other.
Indeed, China Mobile is no laggard in adopting new technology. President Wang Jianzhou has said the company would deploy a high-speed downlink packet access 3G standard.
