It was interesting to see the news on the FT that Telefonica will buy a stake in China Netcom (more precisely, 2.99% for a price tag of €240 million).  While this is still not enough for a board seat (the minimum holding to warrant that is a 5% share), Telefonica is hoping to eventually attain that goal.  The price, according to some Wall Street estimates, came at about a 15% on the fair value of China Netcom - the reasons being the high exposure to broadband growth (given that China Netcom has a near monopoly in local loop, particularly in areas such as Northern China), and the defensive nature of PHS versus wireless (with prices roughly half CDMA).

It is interesting to note that Telefonica is continuing with its strategy of making investments in foreign telcos, despite not being terribly successful thus far in some of its other plays (e.g. Cesky Telecom) and also despite the lackluster performance of other euro players in Asia (e.g. Vodafone's acquisition of a 3% stake in China Mobile has proven to be unfruitful thus far). 

Hopefully, Telefonica's persistence will pay off, and show the way to astutely invest abroad for North American service providers, which have typically have retreated after mixed results investing in regions such as Latin America (e.g. Bell South, MCI, etc.).