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Industry Report Excerpt
January 15, 2009
1. As released early in the morning of January 15, China Mobile, China Unicom and China Telecom are tocancel inter-network SMS differential pricing officially from today on; currently, service fee of sending SMSacross networks is Rmb0.1 per piece.2. At present, SMS income accounts for 12%, 10% and 6% respectively of China Mobile, China Unicom andChina Telecom, with market share of consumer scale at 73.7%, 21.8% and 4.6%. Before the differentialpricing cancellation, Rmb0.05 service fee was charged additionally for sending a piece of SMS acrossnetworks, and operator paid inter-network settlement fee of the same amount (Rmb0.05/piece) to otherones.3. On the whole, the cancellation does not affect profit of integrated telecommunication business and
produces quite limited impact on each operator’s profit.
 4. The policy will smooth out the consumer scale advantage of China Mobile in SMS business, balance themarket competition and avoid monopoly of large operators, which is beneficial to development ofdisadvantaged operators like China Unicom and China Telecom.
By Kang Zhiyi and Zou Gao 
Inter-network SMS Differential Pricing Cancelled,Being Favorable to Long-Term Development ofChina Unicom and China Telecom
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