Ban on Skype-like operations sparks outcry
By Zhu Shanshan
The nation's information technology authorities are clamping down on unlicensed online calling services, drawing the ire of users and analysts who see this attempt at trying to safeguard the telecommunication monopoly of State-owned service providers.
Concerns appeared to have mounted as some Chinese Web users claimed that Skype's two-day service failure from December 22 was suspicious, coming only 12 days after China's Ministry of Industry and Information Technology (MIIT) announced it was stepping up its action against illegal voice over Internet protocol (VoIP) operations in the country.
With the rise of VoIP applications in 2005, the MIIT issued regulations to limit the entry of Chinese private capital into such operations, China Tech News reported.
According to China's Telecommunications Regulations, no organization or individual may engage in telecommunications business activities without first obtaining a telecommunications service operating license.
This effectively means that only two State-owned companies, China Telecom and China Unicom, are in a position to launch VoIP service, although the service's low pricing has not sparked their commercial inter-ests.
Service providers, such as Skype, enable their users to make phone calls at much cheaper prices or even for free from computers to mobile or landline phones through the Internet.
Compared with IP calls costing 2.4 yuan ($0.36) per minute from China to the US, Skype costs only 0.19 yuan per minute, saving 66.3 yuan on a 30-minute phone call.
"I am free to choose. It's unfair to force anyone to use the service of the State-owned companies," Daniel Wu, a Hong Kong resident who works in Beijing, told the Global Times.
"The initiative to get tough on online calling providers is purely to protect the interests of such companies, without considering users' interests," he said.
A staff member with Skype's customer hotline, however, told the Global Times Tuesday that the poor quality of Skype VoIP service last week had nothing to do MIIT action and that Skype would continue its services.
Skype has expanded rapidly in China with 51 million registered users in 2007, when China overtook the US to become Skype's largest market in the world, reports said.
Cai Haining, deputy director of the Committee of Information Network and High-Tech of the Lawyers' Association of China, told the Global Times that since private companies in China do not possess a telecommunications service operating license, they must cooperate with companies that do, such as China Unicom, if they wish to take part in telecommunications business activities.
Dozens of private companies providing VoIP services that sprung up in China following Skype's success have either been shut down or been forced to relocate overseas due to their lack of licenses.
In October 2009, the website for UUCall, one of the major Chinese VoIP service providers, with 40 million registered users, was closed down for reportedly violating mainland laws and regulations.
Its service reopened in February this year after the company relocated its domain name to Hong Kong.
However, Cai said, such a relocation does not protect their operations on the Chinese mainland in the long run, since it remains illegal for those companies to charge fees.
"The new policy is simply to encourage State-owned telecom operators to manipulate the VoIP service sector. These giant operators are reluctant to take on private VoIP service providers that are usually cheaper and provide better services," Lü Benfu, director of the Internet Development Research Center at the Chinese Academy of Sciences, told the Global Times.
Fang Xingdong, an IT expert, said the crackdown goes against Internet users' interests and runs counter to the development of the telecommunication technology.
"It's unfair for the VoIP service users. The ministry must help facilitate communication technologies, rather than block their development," he said.
Song Shengxia and Huang Jingjing contributed to the story