China Telecom has noted that the establishment of a quantum tech hub is in line with President Xi Jinping’s long-term tech adoption.
China Telecom Corp Ltd (Hong Kong: 728), a Chinese telecommunications company, has announced plans to venture into the supercomputer quantum industry to streamline its services. According to the company’s announcement through WeChat, up to 3 billion Yuan, approximately $434 million, will be used to establish the China Telecom Quantum Information Technology Group. Reportedly, the company has chosen the eastern province of Anhui as the desired place to establish quantum technology.
The Chinese economy has experienced significant growth post Covid-19 fueled by the adoption of digital technology including artificial intelligence, blockchain, and distributed ledger, among others. The president of the People’s Republic of China Xi Jinping has laid a lot of emphasis on the adoption of technology to streamline the country’s economic activities.
“The establishment of China Telecom Quantum Information Technology Group is a practical action to thoroughly study and implement the spirit of General Secretary Xi Jinping’s important instructions on the development of quantum technology,” China Telecom said in its statement.
Following the announcement of a quantum technology hub by China Telecom, its stock market closed Wednesday trading around HK$ 3.89, down 1.39 percent from the day’s opening price. Nevertheless, China Telecom’s stock market has gained approximately 27 percent YTD, in addition to last year’s 40 percent spike.
The announcement of a quantum hub by China Telecom follows a similar move by China Mobile Ltd (Hong Kong: 941) earlier this year.
Notably, China Mobile, the leading wireless carrier in China with more than 900 million subscribers, signed a deal with Origin Quantum, a full-stack quantum computing company, to use its quantum computing to overhaul the challenges facing the 5G and 6G technologies.
China Telecom and the Market Outlook
Following a bullish outlook YTD, China Telecom has seen its market capitalization rise to about HK$ 570.64 billion. The company is the second largest wireless carrier in China with more than 362 million subscribers after China Mobile. The introduction of quantum technology is expected to significantly streamline its services amid the adoption of Web3 technology that emphasizes higher bandwidth data.
According to the company’s 2022 annual results recently released, China Telecom announced several developments including full implementation of Cloudification and Digital Transformation. As a result, the company saw its revenue hit a 10-year growth non-stop, whereby it grew at 8 percent YoY in 2022.
In 2022, China Telecom Cloud revenue recorded a spike of 100 percent to RMB 57.9 billion. During the year, the company significantly increased its artificial intelligence (AI) outlook via the Xinghe Platform, which ostensibly has more than 100 use cases and over 10 million customers.
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