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Regulatory complexities hinder China's converged media plans

Lack of converged media services such as IPTV in China due to diverse regulations and lack of single regulatory body--barriers which government needs to act on quickly, Ovum says.
Written by Liau Yun Qing, Contributor on

Joint development of converged media services between telcos and media outlets in China has been hampered by the various regulatory barriers and lack of a single regulatory body, stated a new report.

Released Tuesday, Ovum identified the diverse and complex regulatory landscape and "long-standing" conflict between its two key regulators--the Ministry of Industry and Information Technology (MIIT) and the State Administration of Radio, Film and Television (SARFT)--as the country's biggest barriers to developing services such as Internet Protocol TV (IPTV) and mobile TV. It attributed the conflict between both regulatory bodies to the lack of a Telecommunications Act.

Furthermore, insufficient liberalization and privation of the market have led to a lack of fair competition between broadcasters and telcos, Ovum said. It pointed out that key players in both the telecommunications and media markets, which include the cable companies and three biggest telcos China Telecom, China Mobile and China Unicom, are state-owned entities.

"The State Council should impose further regulations such as interconnection and anti-monopoly measures and remove regulatory barriers between telecoms and media such as the current complex license grant and management mechanism on converged services," suggested Charice Wang, an Ovum analyst based in London, in the report.

She also called on the Chinese government to enact its first Telecommunications Act soon to promote convergence of media services in the country. Noting that the next government restructuring is due to take place in 2013, the analyst suggested that it would be a good time then to introduce a single regulator that integrates both the MIIT and SARFT.

Beyond regulations, the government is also committed to developing its telecoms infrastructure, with broadband development accounting for 80 percent of the 2 trillion yuan (US$308.7 billion) total investments set aside in its twelfth Five-Year Plan for 2011 to 2015.

Telcos and broadcasters are also separately investing to enhance their respective next-generation core and access networks to support converged media services, according to the research firm.

China had earlier announced plans to digitize all of its cable TV networks above the county level by 2015 to spur the convergence of cable TV, telecommunications and the Internet. According to a ZDNet Asia report in March, the SARFT launched a pilot project to evaluate how convergence of technologies would play out over cable TV networks last July. From this initiative, it was to have submitted a proposal to the government to set up a national cable television network company.

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