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China Tower and Alibaba have announced that they formally established a strategic partnership on August 17. The world’s largest telecom tower operator will collaborate with Alibaba on cloud computing, edge computing, big data, and 5G. In return, the company will provide infrastructure for Alibaba’s IoT projects.
China Tower will also leverage the 1.9 million tower sites it manages across China and other infrastructure to allow Alibaba to implement cloud-based smart city and smart transportation projects.
In 2014, China Mobile, China Unicom, and China Telecom, China’s only three telecom companies, formed China Tower by merging their telecom operations to avoid duplicating business and to strengthen tower business. On August 8, China Tower had its debut in Hong Kong Stock Exchange and raised at least HK$54.3 billion ($6.9 billion). The company plans to use 60% of the IPO to increase tower numbers and existing ones. The other 40%, according to the company, will be used for financial operation and debt payment.
In addition to state-backed 5G, IoT and edge computing could be another highlight of China Tower and Alibaba’s partnership. Hu Xiaoming, president of AliCloud, said in a conference this year that IoT has formally become a major strategy after the company’s e-commerce, finance, logistics, and cloud computing. Additionally, AliCloud is already promised with a virtual telecom license which allows the company to enter a pilot scheme in telecom and mobile services as a non-state player, Yicai Global reports.
The plan to leverage China Tower’s unique advantages, in fact, has shown traces before the establishment of the strategic partnership. A unit of Alibaba was China Tower’s cornerstone investor. Also, last month, there was rumor spreading within the telecom circle that Alibaba was in talks with China Tower to secure a partnership. However, until now, no detailed information on specific cooperation plans, from the official announcement nor market rumor, is available.