Marbridge Daily

China's Number of Value-added Telecom Service Enterprises Exceeds 78,400

CAICT, 1/15/20

As of the end of December 2019, China's total number of enterprises holding a value-added telecommunications service license reached 78,445, up 1.57% month-on-month, reports the China Academy of Information and Communications Technology (CAICT), a department of China's Ministry of Industry and Information Technology (MIIT). Of this total, 19,367 were cross-regional enterprises licensed by the MIIT, up 2.48% MoM, and 59,078 were local enterprises licensed by provincial (regional, municipal) communications administrations, up 1.27% MoM.

Regionally, China's value-added telecommunications industry is currently characterized by uneven development. Among the 19,367 cross-regional enterprises, 4,811 are registered in Beijing, 3,962 in Guangdong, and 1,914 in Shanghai, for a combined total of 55.2%.

Among the 59,078 local enterprises, 12,220 are registered in Beijing, 7,396 in Guangdong, and 6,506 in Zhejiang, comprising a combined 44.2% of the nation's total local value-added telecom service enterprises. The next largest concentrations are in Jiangsu, Shanghai, and Sichuan, which, combined, comprise another 17.6% of the total, meaning that 61.8% of China's local value-added telecommunications companies are concentrated in these 6 provinces; in contrast, the combined number of local value-added telecommunications enterprises spread out across China's 12 western provinces accounted for only 12.2% of the country's total.

Based on the value-added telecommunications service classification in the 2015 edition of China's Telecommunication Service Catalogue, China's 78,445 value-added telecommunications companies have a total of 98,519 licensed projects. Among them, 45,931 (or 46.62% of the total) are Internet information service projects, 15,850 (16.09%) are non-Internet information service projects, 13,481 (13.68%) are online data processing and transaction processing services, 10,159 (10.31%) are domestic call center services, 5,791 (5.88%) are Internet access provision ("ISP") services, 3,210 (3.26%) are Internet data center ("IDC") services, and 4,097 (4.16%) are other businesses.

In terms of the main service categories provided by China's 19,367 cross-regional value-added telecommunications service enterprises, the top three were non-Internet information services (11,327 operators), domestic call center services (7,904 operators), and Internet access services (3,684 operators).

The range in the amount of registered capital across China's 19,367 cross-regional value-added telecommunications service enterprises is substantial, but with the majority (69.6%) clustered at RMB 10 mln. Those with registered capital greater than RMB 10 mln but less than RMB 50 mln comprised 17.3%, those with RMB 50 mln to RMB 100 mln comprised 7.1%, and those with RMB 100 mln or more comprised 5.6%. A small percentage (0.3%) had registered capital of less than RMB 10 mln.

Currently, the sources of investment and financing in China's value-added telecommunications field have become increasingly diversified, and private capital has developed into a major force. As of the end of December 2019, among China's 19,367 cross-regional value-added telecommunications service enterprises, 749 (3.9%) were state-owned, 18,473 (95.4%) were privately held, and 145 (0.7%) were foreign-invested enterprises.

This Month's Featured Sub-sector: Information Services

1. Internet Information Services

According to data from the MIIT's annual industry statistics report, China's 2018 internet information services revenue reached RMB 697.41 bln, up 28.4% YoY. Of this total, revenue from enterprises licensed by the MIIT (i.e. Sino-foreign joint ventures) contributed RMB 5.03 bln, up 69.9% YoY, and enterprises licensed by provincial (regional, municipal) communications administrations contributed RMB 692.38 bln, up 28.2% YoY.

China's Internet Information Services Revenue (RMB Bln)

Internet information services comprise the largest share of China's total value-added telecommunications service industry, accounting for 65.5% of total revenues and 49.7% of total number of value-added telecom enterprises. Internet enterprises continue to innovate in areas such as mobile payment, sharing economy, life services and public service platforms, driving the steady growth of China's internet information services revenue. Together, online games, online video, live streaming, and online advertising continue to be the main sources of Internet information service revenue.

2. Non-internet Information Services

According to the MIIT's annual report data, total 2018 revenue generated by non-internet information services came to RMB 75.16 bln, up 15.6% YoY. Of this total, revenue from enterprises licensed by the MIIT contributed RMB 58.7 bln, up 31.9% YoY, and enterprises licensed by provincial (regional, municipal) communications administrations contributed RMB 16.46 bln, down 19.7% YoY.

China's Non-Internet Information Services Revenue (RMB Bln)

Editor's Note: China's 12 western provinces include Inner Mongolia, Guangxi, Chongqing, Sichuan, Guizhou, Yunnan, Tibet, Shaanxi, Ganxu, Qinghai, Ningxia, and Xinjiang.

Keywords: wireless Internet revenue telecom MIIT call center Internet access Internet data center value-added data processing ISP CAICT private investment national statistics