China Telecom has announced it is launching a virtual mobile network in the UK using Everything Everywhere's infrastructure, in a move that underlines the growing ambitions of Chinese firms to penetrate western markets.
The service is set to launch in the first quarter of 2012 and will primarily be targeted at both Chinese residents and firms in the UK, as well as visitors to the country such as students and tourists.
Managing director for China Telecom in Europe, Yan Ou, said the deal with Everything Everywhere, which will be managed by its virtual network aggregator partner Transatel, was a "stragetic move" for the firm that would help it grow in the UK.
"We are keen to launch the service in the UK as soon as possible as there is a real gap in the market for the provision of tailored mobile services and competitive tariffs aimed at the growing Chinese population in the UK," he said.
However, Ovum telecom strategy practice leader, Steven Hartley, argued that while the deal underlined the firm's ambitions it would not have a huge impact on the UK market in the near future.
"The deal is notable for China Telecom's expansion outside of China and as an attempt for it to do something different to its rivals. However, the impact in the UK is likely to be muted," he said.
"The company's main selling point is likely to be cheap calls home. However, the likes of Lyca Mobile and Lebara already offer this. These rivals are also able to sell to a broader audience wanting to call other countries aside from China."
Everything Everywhere is already working with Chinese ICT giant Huawei after it signed a deal with the firm to upgrade its 2G network and provide equipment for future 4G services.
Meanwhile, China Telecom's Ou revealed to V3 in July 2011 that the firm plans to increase its footprint in Europe by making sizeable acquisitions in the ICT space, deals of which could well materialise in 2012.
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