Jan. 10, 2007 (China Knowledge) – China Netcom, the smaller of the Mainland’s two fixed-line telephone operators, is planning to downsize by selling back some of its business in Shanghai and Guangdong to its parent Network Communications Group Corp., according to domestic media reports.

China Netcom’s pending withdrawal would underscore its failure to compete against China Telecom’s dominance in southern China. China Netcom provides phone and Internet services in 10 northern regions, including Beijing and Tianjin and provinces such as Hebei, Henan, Shandong and Liaoning.

China Netcom spokeswoman Xu Song also hinted of the downsizing Monday, saying that the company is examining ways to restructure operations. She, however, did not specify a timetable.

By the end September 2006, China Netcom had 119.5 million fixed-line users and 14.3 million broadband users.