Why Is China Mobile Forming An Internet Company Now?

China Mobile's Internet subsidiary named China Mobile Internet Business gained its business license on October 30, 2015, and has begun formal operations.

But why is China's largest mobile carrier forming an offshoot company solely focused on Internet services now? China Mobile president Li Yue revealed at the end of 2012 that the behemoth would establish an Internet company to integrate China Mobile's Internet businesses and create independent operations. He said at the time that China Mobile's video and online content would be included into a new media company as well. They expected to complete the company establishment in 2013, but the progress to create the subsidiary was slow.

At the beginning of 2015, China Mobile finally launched its new media company named Migu, which integrates music, videos, reading, gaming, and animation content of China Mobile. So the new China Mobile Internet Business company will complement Migu by focusing on key Internet sectors for consumers and businesses.

Headquartered in Guangzhou, Guangdong, the new company will be led by Hong Xiaoqin, former general manager of China Mobile Inner Mongolia.

Hong was born in 1964 and as a senior engineer, he has extensive experience in engineering equipment maintenance. In 1985, Hong joined Guangdong Provincial Postal Administration as the deputy director; in 1999, he was appointed deputy general manager of China Mobile Guangdong; and in September 2010, he was transferred to China Mobile Inner Mongolia as general manager.

New service rollouts and total expected capitalization levels have not yet been announced for the new Internet venture.