Two major Chinese e-commerce players are now on their way to becoming mobile carriers.
The Chinese government has issued what is known as ‘mobile virtual network operator’ licenses to HiChina, a subsidiary of e-commerce giant Alibaba, as well as its rival JD.com, which allows them to resell mobile telecom services.
This means they get to lease mobile services from the three state-run major carriers — China Telecom, China Unicom and Chine Mobile — but offer their own independent packages with data and discounts for mobile devices that may differ from what is on the market right now. In total, 11 firms received the licenses.
An Alibaba spokeswoman confirmed that HiChina got the license, but declined to elaborate further on specific plans.
JD.com, however, has expressed its ambitions to become China’s fourth-largest mobile carrier within five years. The company’s vice chairman Guoqing Zhao says:
The combination of being China’s biggest seller of mobile phones and our deep existing relationships with the country’s three major telecom companies makes this move into core mobile communications services a logical next step. The largely 23-45 year-old make up of JD.com’s 140 million registered users, which closely matches the biggest growth segment of the mobile phone market, will help us achieve our goal of becoming China’s fourth largest mobile carrier within five years
The specific timeline for the rollout of these alternative mobile plans will likely be revealed in the coming months — though it will definitely be interesting to see what kind of packages will be offered, and if they will undercut the state-run carriers greatly.
One thing is for sure though: consumers will benefit from more choices. With mobile commerce on the rise and expected to grow through 2014, having two giant e-commerce firms step into the space will likely herald in more emphasis on capturing shoppers via their mobile devices — and flip a new page in the m-commerce race in China.
Headline image via AFP/Getty Images