There were both positive and negative developments for the China Internet market over the past seven days. Among the more positive news stories were reports that the Ministry of Information Industry will likely lower access and line charges affecting both commercial service providers and individual users and an announcement by market research firm Advanced Forecasting-HuiCong that China's domestic PC market grew 60% last year. According to chief analyst Dr. Peng Fu, impressive growth logged in China's PC market last year was accompanied by a shift in buying preferences away from no name computers toward well known brands, good news for marker leader Legend, and runners up Compaq and IBM. The MII's announcement of impending rate decreases came without specifics or a time table, but appears to be an answer to growing consumer and business complaints over high access fees.
Among the more negative developments were news that the Chinese government had shut down a popular discussion forum and an announcement by a Ministry of Information Industry official that there would be a major crackdown on China's nascent IP telephone industry. Internet discussion group "Everything under the Sun," hosted by Sina.com and apparently one of the most popular such discussion boards in China, was summarily shut down by government authorities on February 4th. Closure of the site came just one week after the Hong Kong based Information Centre for Human Rights and Democratic Movement in China announced a pending crackdown on BBSs and online discussion sites. More closures can be expected in the near future. Zhang Chunjiang, director of the ministry's telecommunications administrative bureau, announced last week that the Ministry would "crack down harshly" on IP phone companies that are "tantamount to information smuggling by bypassing government supervisions in our country." Instead, Zhang announced the MII would be opening several approved, pilot projects in IP telephony in the coming months.
Also this week, Lin Hai, convicted and sentenced to two years in prison for providing dissident publication Dacankao with more than 30,000 domestic Chinese e-mail addresses, filed the appeal last week in the Shanghai People's High Court.
