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Chinese Networks Set up $1.2 Billion Tower Sharing Venture

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China's three mobile networks have set up a joint tower sharing company as a new stand alone operator which will build future towers for the three networks.

At the moment, it's not clear if they plan to transfer any of their existing towers into the new company, and in their statements said that they are still at the preliminary stage of considering that.

As it stands, the new joint venture is 40% owned by China Mobile; 30.1% owned by China Unicom and 29.9% owned by China Telecom and has a registered capital of RMB10 billion (USD1.2 billion).

The statement said that the new company would be dedicated to the "construction, maintenance and operation of telecommunications towers; construction, maintenance and operation of ancillary facilities including base station control rooms, power supplies, air conditioning and interior distribution system; and providing outsourcing services for base station equipment maintenance."

The investors expect that the company will help reduce the cost of network expansion as they can remove duplication of towers as rivals.

The main impetus for tower joint ventures though is to reduce ongoing costs by cutting duplication in the existing portfolio of towers, and it remains to be seen how large that cost saving will be, if and when the mobile networks transfer their existing tower assets to the new joint-venture.

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Tags: china mobile  china telecom  china unicom  China