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VoIP In China: We Express Our "Doubtness"
[March 15, 2006]

VoIP In China: We Express Our "Doubtness"

TMCnet Contributing Editor

The Beijing News is reporting -- Page 1, no less -- that "it is said that a company from southern China obtained the first VoIP service operation license as a pilot."

Telecom carriers and virtual network operators will be able to apply for the license by 2007 when the country will fully open the market, but "experts from China's Ministry of Information Industry, the industry regulator, expressed their doubtness."

It's not specified what they expressed their doubtness about.

Earlier, The Beijing News says, the ministry "approved the fixed-line carrier China Telecom to launch experiments in Shenzhen and Shangrao, two cities in Guangdong and Jiangxi Provinces, and ratified the counterpart China Netcom to present the same business in Changchun and Taian, cities of Jilin and Shandong Provinces."

But the two operators were not willing to do so because "the VoIP service will erode a great deal of profit from the fixed-phone service," according to sources familiar with the matter.

VoIP isn't zooming up the charts in the ol' People's Republic -- enter "VoIP in China" on Yahoo! News and get exactly two hits. Yet there are those who are predicting big things in 2007. Well, bigger than what's happening now, anyway.

Telintell, for one, thinks that Chinese VoIP revenues will reach over $10 billion by 2010, as well as predicting that fixed line subscribers to reach over 600 million by 2010. Hard to find anyone else willing to put pen to paper and take a serious stab at estimating the future of the market -- and that report's going for about a hundred bucks.

The Edge Daily does tell of Mobif Bhd, which has "signed a Network Deployment Agreement with Ying Te Yi Technologies (Beijing) Co Ltd in China to deploy voice over internet protocol products to the latter."

In a statement to Bursa Malaysia, Mobif said with the signing of the agreement on Feb 14, it has "further expanded its VoIP presence in Asia," and the management is “especially positive” on its prospects in China, given its large market size.

Initial indication from Ying Te Yi is to sell 500,000 units of Mobif’s VoIP telecommunication boxes over a period of two years, Mobif said.

"It added that one of Ying Te Yi’s major customers for this VoIP service is China Tietong Telecommunications Corporation, Tianjin branch, where Mobif’s VoIP product would be rolled out immediately now that the agreement has been inked," The Edge Daily reports.

“Due to China’s high telecommunication charges (regulated by the authorities), Mobif believes that there will be good take-up rates for VoIP in China. VoIP will not only help phone users lower their phone charges but will also help telecommunication companies lower their operational costs,” the journal added.

So there's stuff happening, but when you're as addicted to the profits from telecom as the Chinese are, it's a hard habit to break. We'll see what happens in 2007. Withdrawal's a painful thing.

David Sims is contributing editor for TMCnet. For more articles please visit David Sims' columnist page.


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