According to local media, China Telecom (CHA) will set up a subsidiary called Tianyi for the acquisition of the CDMA network of China Unicom and the construction and perfection of the network.

The status and function of this Tianyi Company is similar with the Unicom New Space of China Unicom.

An insider says that China Telecom raised the plan to set up the Tianyi Company at its interim meeting held in Guizhou in July 2008. According to the plan, the new subsidiary will cooperate with China Telecom's provincial companies around China and its listed company to promote the development of the group's fixed-line and mobile businesses and to implement expansions and constructions in its weak markets in the northern areas.

Latest released organization and business structure of China Telecom Corporation shows that China Telecom will set up branches of Tianyi Company in 31 provinces across China and commission its listed company, China Telecom Corporation Limited, and its provincial companies to manage and lease its CDMA network. China Telecom Corporation Limited will establish branches in Tibet and nine northern provinces to manage mobile businesses while China Telecom will manage fixed-line services in those areas. The revenue and costs and the two companies will be shared and checked in accordance with relevant regulations.