The three Chinese operators have been surprisingly reticent about investing in MNOs in other parts of the world, but that may be about to change, with the companies eyeing opportunities as far apart as Brazil and the Philippines.
Philippine president Rodrigo Duterte has offered Chinese premier Li Keqiang the chance for a Chinese firm to become his country’s third operator; while China Telecom is reported to be interested in troubled Brazilian MNO, Oi.
The Philippines government has been keen to break the duopoly in telecoms of PLDT and Globe. No specific Chinese company was proposed to take the third licence, according to local reports, but China is considered a good option because it is in the same region and has strong finances and technology.
But the government’s desire to lure a foreign operator could be thwarted by a clause in the Philippines constitution that limits foreign ownership in domestic operators to 40%, which could make the investment a less attractive prospect.
Another option – which has been discussed in the past – might be for the government to establish a new state-owned third operator, or give a full telecoms and mobile licence to state company TransCo, which has said it aims to become the nation’s “third telco”.
Meanwhile, halfway around the world, Oi’s CEO Marco Schroeder has spent the past 17 months trying to get the operator back from a $19bn bankruptcy proceeding. Creditors are now scheduled to vote on December 7 on a restructuring proposal, but few are hopeful of a resolution unless a buyer comes along. That buyer could be China Telecom, whose executives visited Oi headquarters a few weeks ago, apparently to conduct due diligence ahead of a possible bid.
Oi is a converged operator with around 1.5 million pay TV customers, in a Brazilian market dominated by Net Servicos with over 13.3 million, and Sky Brasil, with over 5 million pay TV subs, and Telefonica with around 2.2 million.