Broadband China strategy is expected to address low network speeds

The State Council recently proposed the implementation of the "broadband China" strategy. For Chinese Internet users who have been plagued by slow Internet access and low download traffic, this strategy is justified.

Information consumption is expected to become a new economic growth point

The 31st China Internet Network Development Status Report released by the China Internet Network Information Center shows that as of the end of December 2012, the number of Internet users in China reached 564 million, and the Internet penetration rate was 42.1%. Since 2008, the number of Internet users in China has been ranked first in the world.

In contrast, the development of bandwidth and network speed has lagged behind, ranking dozens of people out of the world. Many Internet users often encounter problems such as unclear pictures and poor video playback when they use mobile phones to access the Internet and watch videos. Zhao Yusen, an academician of the Chinese Academy of Engineering, believes that improving the data capacity and transmission rate of broadband has become the primary task for the development of the information industry in China.

At the National Conference on Industry and Information Technology in 2011, the Ministry of Industry and Information Technology proposed the "Broadband China" strategy to speed up the upgrading of information networks, promote fiber-to-the-home in urban areas, and achieve universal access to broadband services in administrative villages. It is proposed that by 2013, the proportion of users who use 4M and above broadband access products will exceed 70%.

The industry believes that the benefits of implementing the "Broadband China" strategy are far beyond the speed of the Internet and the growth of income of IT companies. It will also stimulate related manufacturing industries such as optical fiber manufacturing, network equipment, computers and home appliances, and form a strong industrial chain extension. Drive effect. China's optical fiber broadband investment will exceed 150 billion yuan, which plays an irreplaceable role in stimulating domestic demand and promoting consumption.

The executive meeting of the State Council stated that private capital is encouraged to enter the basic telecom operation market by way of equity participation, and the development of intelligent terminal products is encouraged, and consumption is guided through innovation. In the three years after the “Twelfth Five-Year Plan”, the average annual increase in the scale of information consumption was more than 20%, and the amount of e-commerce transactions increased significantly.

The Ministry of Industry and Information Technology predicts that by 2015, the scale of information consumption is expected to exceed 3.2 trillion yuan, driving more than 1.2 trillion yuan in new industries in related industries. Yu Shaohua, chief engineer of the Wuhan Institute of Posts and Telecommunications said: "Information consumption is expected to become a new economic growth point."

Three thresholds hinder the release of consumer potential

Although the outlook for information consumption is bright, if we want to successfully implement the "broadband China" strategy, we must go through three thresholds.

First, the low speed and high fees have hindered the "broadband China" strategy. According to Li Hanbing, technical director of Fiberhome Technology Group, the fiber-to-the-home project has been implemented for many years, but since the cost of broadband light is higher than that of broadband, most people are reluctant to accept broadband upgrades.

Secondly, although the pace of private capital entering the telecommunications industry is accelerating, in the face of the three major operators and the national and public number broadcasters, private capital is undoubtedly a “disadvantaged group.” If the country does not have specific policies to escort, there is no way for the introduction of private capital.

Industry insiders pointed out that in the communications industry, there is often a certain lag between network investment construction and the market, with large investment in the early stage, and the market return can not make up for the investment gap in time. “If the state does not have substantial measures to give preferential subsidies, many private enterprises have been afraid to open up their inputs because they have no support,” said Li Hanbing.

Third, due to the development strategy of the operating companies themselves and the imbalance of the market economy, the overall broadband penetration rate in China is low, and the imbalance between information development in the eastern and western regions and between urban and rural areas.

Wei Leping, director of the China Telecom (Weibo) Science and Technology Committee, has analyzed that the fiber-to-the-home investment recovery period in the eastern urban areas is 7 years, the central region is about 11 years, and the remote western regions are decades. Projects with a return on investment of more than 10 years are bound to be abandoned by the market.

Experts pointed out that if broadband construction between regions is not coordinated and a complete network cannot be paved, then the "Information for the People" project, the nationwide employment information network, and the construction of the Internet of Things will not be used.

Market Urgently Calls for Policy Details

At present, China's optical fiber broadband investment is insufficient. According to the "Opinions on Promoting the Construction of Optical Fiber Broadband Network" issued by seven ministries and commissions in 2010, the optical fiber broadband investment in the country will exceed 150 billion yuan in three years, which will be invested by the three major telecom operators. However, the city’s strained pipeline space resources, high amount of tolls, compensation fees, admission fees, and investment in rural and remote areas in the midwestern region all affect the enthusiasm of companies to independently invest in the construction of optical fiber broadband.

Zheng Yansheng, manager of product development and management department of Ascension Technologies, believes that simply relying on industrial strength and relying on independent investment by enterprises will not be able to support such a huge market of optical fiber broadband. The state should increase its support and give financial support for major engineering projects and truly invest optical fiber broadband as a strategic industry.

In addition to funds, policy support is also indispensable. "The government's policies will not be introduced, and the enthusiasm of developers, manufacturers and operators will not be able to rise." Li Hanbing said that China has established a fiber optic access industry alliance in the field of optical fiber communications, but member units are currently limited to the technical level. Cooperation, in-depth cooperation in the application.

Wei Leping suggested that the state should overall plan the "broadband China" strategy, promote the overall construction of operators on policy support and capital investment, give preferential treatment to the construction of new residential broadband, and subsidize costs, taxes, and finances. In addition, it is also possible to try. Similar to the "home appliances to the countryside" policy, activate the rural broadband market.

Although "Broadband China" is still in its infancy, Li Hanbing estimates that in the next 3-5 years, the optical fiber broadband market will usher in a period of great development. The government's treatment of fiber-optic broadband projects can, like the “village-village” and “road-pass,” guide fiber-optic companies to invest in “pave the way” for all citizens’ information consumption, making it a new growth point for stimulating domestic demand.