The government report also pointed out that broadband prices decreased about 40 percent from 2006 to 2010. China Telecom said prices will continue to decrease over the next five years.

The company also said it will introduce cloud computing (using the Web as a hard drive) and the "Internet of Things" (connecting everyday electronic objects to the Internet), provide more Internet applications to broadband and mobile Internet users, and accelerate its transformation into a comprehensive telecom service provider.

"Applications are the core issue. What we can bring to our customers is a more important question, we think, than the discussion about using 3G or 4G," said Wang.

China Telecom is calling for more Internet companies to create and cooperate in providing more applications, General Marketing Manager He Zhiqiang said.

"All the applications you can find on the iPhone that you are charged for, we will provide to our customers for free," He said.

Cloud computing will be at the top of the company's agenda this year.

China Telecom has accelerated the pace of providing cloud-computing services to small- and medium-sized companies and rural schools to help them save on fixed costs.

The company currently has 70 million low-speed broadband users.