Study On Latter Entrants' Effective Competition In Chinese Telecommunication Market

The monopoly, competition and regulation in telecommunication industry have always been a major issue both in academic circle and in reality. The goal of Chinese telecommunication industry reform is the beneficial development of telecommunication industry, while the key boosting the telecommunication industry lies in taking form effective competition. At present, Chinese telecommunication industry has existed part of competition within some business range, but in such fields as locality telephone, mobile phone and so on, it still be in dual oligopoly situation. Chinese selected nationalization way in resolving natural monopoly. It may relieve the problem that resource be occupied by part of beneficial group in some extent, but it also brings up such problems as low supervision, low efficiency and bureaucrat tradition. In fact, the worst result that government acts as monopolist and supervisor is lack of price control and serve quality.Under the situation of Chinese telecommunication scale remaining boost and inner organizational structure being changed, the industrial supervision policy tendency of Chinese government becomes explicit day by day, which is conform to the tendency of world telecommunication, break into monopoly, introduce competitors and foster effective competitive operators, it also means there will be more latter entrants and more competition in telecommunication industry. Then an important problem arises which is the government how to implement effective measures and to foster market. Based on current researches, the paper goes a further step and selects latter entrants that have significant influences on Chinese telecommunication industry, and analyses its approach way, regulation influence and competitive effect in middle aspect. It aims to achieve following purpose by such studies:Firstly, from aspect of industrial new entrants and telecommunication industrial characteristic, disposes the unique game process between new entrants and domain operators, and discloses the way that to realize effective competition for latter entrants. Secondly, from aspect of mutual influence between property institutions and effective competition, to explain the fact that the formation of main competitive body relies on property rights diversification and sounded company governing structure, announcing that the ineffective or invalid competition in Chinese telecommunication lies in the dominant situation of national property rights. Thirdly, by analyzing Chinese telecom regulation reform and opening competition practice, evaluates the effectiveness and problem of regulation theory and policy in pushing latter entrants carrying on effective competition, seek for the links between regulation policy and practice, hence to provide theoretical basis for deepening latter comers competitive and regulation theory and reform of regulation policy.To achieve such purpose, this paper referenced institutional economics, property economics, network economics, telecommunication economics and monopolistic competition theory, applied such approaches as combining theoretical reasoning with experience evidence, modeling with demonstration and has got below conclusions:(1) Discussed the industrial enter way of Chinese telecommunication market in fostering latter entrants, which is in process of introducing new basis telecommunication operators, reorganizes domain operators, and cultivates new competitive body in such two way. It may not easily go through in other countries that base on private property, in those countries government have no rights to dismantle a telecom corp. unless it violates monopoly law, however, Chinese social and economic institution and state-owned character of Chinese Telecom Company makes such works easily to go, which also provides a special case for worldwide telecom reform.(2) Proposed that necessity duplication constructions are important measures for new entrants to realize effective competition. Duplication construction means transmission ability and the network capacity increase cannot be absorbed by users. Even several telecommunication operators invest certain market, as long as the transmission ability and the network capacity increase may be absorbed by users, it still remains effective market, while such construct cannot be considered duplication construction. Necessity duplication can make latter comer rapidly perfect network facility and realize facilities-based competition.(3) From systemic and historic aspect, this paper comprehensively analysed the mechanism of telecommunication effective competition evolve. Marginal entrance becomes a sound choice that can balance various aspects. Which also means Chinese telecom regulation loosen has the characteristic of "marginal entrance". Such character combines with network economic effect makes Chinese telecommunication industry stays in a kind of "locking condition": the market monopoly and plot based on department monopoly.(4) This paper advanced that the fixed telecom network and mobile network in the identical group company (or in the listed company), which belong to the three big entire business operation telecommunication group should adopt parent company and subsidiary system after the third reorganization, and cannot adopt the services department system. Under the services department system, the mobile business and fixed telecom business mix calculation, which will limit the latter entrant's investment objectively, and raise its entrant's cost in process of absorbing private capital and oversea capital.(5) According to Chinese telecommunication system changing way, this paper analysed new entrants realizes effective competition and the difference between Chinese and western countries, and advances that to realize effective competition, the new entrant of Chinese telecommunication should based on its political system, culture condition and economic technology, carries on suitable industrial reorganization, makes corresponding property right arrangement, and auxiliary by reasonable moderate rules, regulations policies and push numerical and network combination. After having analyzing several reorganization cases, the paper considers that the problem of Chinese telecom lies in nationalization and inclusive monopoly, without new entrants. State-owned property makes the government does not hope for fierce competition such to impair state estimates appreciation. State-operated causes all plans to balance, seeks ways to save the national resources, which cause the difficulty to eradicate the administrative monopoly. The key is that the quantities of new competition main body are too few, latter entrants must be introduced.(6) Combining telecommunication theory with policy research, this paper analysed the influence of monopoly system reform to realization effective competitive of telecommunication latter entrants. This paper considered the key of regulation system lies in the foundation of a series of regulation system, while the dependence of regulation system constitutes the central part of regulation governing. This paper also advanced several measures as deepening Chinese telecommunication regulation system reform.