Telecom Convergence And Its Impact On China Market

From industrial change perspective, industrial convergence is the border contraction and disappears in order to adapt industrial growth pattern. In the trend of convergence, telecom, IT, media, consumer electronic have blurred their boundaries between each other. Several isolated industries are on their way to get together, and form a new value chain. With the extension of telecom industry value chain, any single player could hardly sweep the market with its own resources; in contrast, the compound growth with external resources becomes more and more important.The definition of telecom convergence is quite board, including internal network convergence and external industrial convergence. The network convergence, especially IP technology, is the premise of industrial convergence. Three prominent industrial convergences are listed in this paper: the first one is IPTV, which is focus on the convergence of telecom and digital media, to meet individual users' needs; the second one is FMC/FMS, to allow individual/enterprise users communicate at any place at any time; and the last one is ICT services focus on enterprises users.China telecom industry has achieved remarkable success since being constructed. Telecom convergence not only belongs to some developed countries, China also has begun the process of convergent telecom construction with 10 years rapid growth. Telecom service providers realize the importance of convergent services and hence its enormous economic value, so they bring out their transformation objective—from a traditional basic telecom service provider to a modern integrated information service provider. Another important player in telecom value chain, the telecom equipment manufacturer, also realizes the decrease in hardware demands and growth space. At the same time, with the continue expansion on service portfolio provided by telecom service provider, the criteria for telecom equipment manufacturers are higher and higher. In order to meet operators' product line and regional requirements, manufacturers has begun the transformation to End-to-End solution provider. However, the pressure and criteria for equipment manufacturer's transformation is more urgent. Because they can survive and make developments in the next round competition only if they can move earlier than operators.All in all, telecom convergence is a complex and systematic project. The evolution of industrial convergence is in process of different sectors, and ultimately will lead to a fusion framework of a new telecom industry.This paper begins with the concept and features of new telecom industry value chain in the convergence era in the use of some fundamental theories, like the industry value chain and new cannikin theory. Then define the internal network convergence and external industrial convergence in telecom and analyze the impact of telecom value chain. In Chapter Four, give some detail description of China telecom market with PEST model. And next focus on two key component of telecom industry—telecom service provider and telecom equipment manufacturer—to analyze their strategy and positioning in convergent era with domestic and abroad transformation case studies. At last, a comprehensive summary and recommendations for China telecom industry are given.