Despite various reports in the Hong Kong media earlier this week, the China Daily today quotes an unnamed source at the Ministry of Information Industry (MII) as dismissed rumors that the regulator plans to merge China's four major state-owned telecommunication firms into two companies in order to raise the sector's competitiveness ahead of foreign entry in 2006.

According to the Hong Kong reports, China Netcom Corp. was to be merged with mobile operator China Mobile Communications Corp., while China Telecommunications Corp. combined with mobile network company China United Telecommunications Corp.