China's second and third largest state-owned telecom operator announced their strategic alliance with each other and join hands to compete with China Mobile.

ANBOUND's scholars point out that the strategic alliance between these two companies will soon spur the rumors of the mergers of these two companies.

Currently, the main practice of the SOEs reform is to group the SOEs of similar nature which has performed poorly under the new normal together. Such a measure is intended to protect the SOEs, and this not a true way to pursue market-oriented reform.

If we assess it objectively, such a merger would only strengthen the monopoly by the SOEs in the relevant field.