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China Communications Government

China Telecom Companies Pledge To Stop Monopolistic Practices 68

Posted by timothy
from the take-it-with-a-mine-of-salt dept.
hackingbear writes "China's two telecommunications giants, China Telecom and China Unicom, announced Friday they will substantially raise their broadband speeds while further lowering broadband costs by 35% over the next five years. They also acknowledge the existence of monopolistic practices in reply to a recently launched investigation, which is the first of its kind against major Chinese state-owned enterprises. Being state-owned companies, their profits supposedly belong to the nation, but they have also become 'golden rice bowls' for their management and employees, and their supervising departments and officials." If the Chinese government would like to investigate these companies' monopolistic behavior, I have a suggestion on where to start looking.
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China Telecom Companies Pledge To Stop Monopolistic Practices

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  • by fuzzyfuzzyfungus (1223518) on Sunday December 04, 2011 @10:14PM (#38262082) Journal
    Architecturally, there isn't anything requiring a communist government to not pit multiple state-owned enterprises against one another in an attempt to make them more efficient(in fact, a communist government might actually be the shareholder most willing to do so; because it can maximize its effective 'value' by making the enterprises it owns more efficient, rather than by making them more effective rent-seekers, as an owner who can profit only by collecting rents and not by collecting taxes would have to...).

    There is absolutely no assurance that they would actually be thus motivated, and, in practice, you'd probably see roughly the same level of monopolistic behavior and general rent-seeking obstructionism from a state-owned corporation as you would from an ostensibly-private 'regulated monopoly', like old-school Ma Bell; but there isn't any theoretical problem preventing it from happening...

    Pitting individuals, departments, project development teams, etc. against each other in order to induce greater effort is hardly unknown among organizations that 'own' both sides of the competition they set up. Sometimes it's a good idea, sometimes it is a terrible idea; but it is empirically undeniable that (if they think that the benefits of internal competition will be greater than the waste of internal duplication of effort) people will sometimes pit their assets against one another.

    After all, if it were necessary that state-owned telcos be a monopoly, why would there be more than one?
  • Re:In other news (Score:5, Interesting)

    by kingturkey (930819) on Monday December 05, 2011 @12:29AM (#38262656)

    Golden rice bowl is (you probably could have guessed this) a Chinese idiom meaning a high paying, stable job. Besides, it's not a stereotype, almost all meals in China (and other Asian countries as well) have a rice component. The word for meal is the same as rice. []

  • by LS (57954) on Monday December 05, 2011 @03:53AM (#38263564) Homepage

    As an internet developer in China, I can tell you that the duopoly posed by these two companies is wrecking havoc on the Chinese internet. First, a bit of history:

    Around 2001, there was only one company controlling most of China's internet access, and that was China Telecom. Jiang Mianheng, the eldest son of the Chinese President at the time, Jiang Zemin, took in hundred of millions in investment to start a new telecommunications company, China Netcom. They struggled for a while trying to compete, but China Telecom's dominance prevented them from getting much headway in the market. Jiang Zemin then used his massive leverage to break up China Telecom, and give 1/3 of its business, all in northern China, to China Netcom. This caused serious enmity between the two entities. Eventually China Netcom was purchased by China Unicom, the second largest mobile provider in China. So now you have China Telecom and China Unicom as the two major telecommunications entities in China.

    Do to the bad blood between the two, the connectivity between the Unicom and Telecom backbones is utter shit. International lines are connected through Telecom's backbone through Shanghai and other hubs further south, so if you are on Unicom, expect international connections to be utter shit. I'm in Beijing, and most home and small business connections are on Unicom. 90% of the time international connectivity is slow or non-existent.

    We have clients in Shanghai, which is mostly Telecom, our server is on Unicom here in Beijing, and they get dropped connections 1 out of every 5 or 6 requests. We had to set up a proxy in Shanghai to get around this. If you do a traceroute from a Unicom ADSL connection to a Telecom server, you can see response times jump to 300-400ms where the hand-off occurs.

    It's fucking infuriating. You basically have to either build a convoluted topology and set up some serious monitoring, or pay exorbitant extortion fees and get on a BGP network to have solid nation-wide service for your customers. As a small start-up we are opting for the first for now.

    Hopefully this government probe will also deal with these sorts of deeper issues as well, because these problems are seriously crippling the Chinese internet as a good place to do business.


  • Malice or Stupidity? (Score:2, Interesting)

    by Anonymous Coward on Monday December 05, 2011 @04:18AM (#38263658)

    As a long term expat in china its nice to see some improvement in the Speed department. The internet here is besides being censored just slow here compared to...well somalia maybe. it also depends on location for example if your in BJ you can get (for $$$) lightningfast internet. But just outside the provincial border (hebei) its like 56k on good days and it does not matter how much you pay.

    But i dont think its all greed. If there is the choice between malice and stupidity its usually the latter. China became a Developed country overnight, the roads and city designs are a great example of that. in 2006 the city of ningbo was just a well designed clean, nice and modern city. Today its still a modern city however with a 24/7 traffic jam. The internet is kinda like that. The existing infrastructures where not designed for THAT many people expecting Highspeed internet.

  • by Anonymous Coward on Monday December 05, 2011 @05:00AM (#38263802)

    It's the same as other countries that tout the democratic free speech thing but do their very best to minimize democratic effects and free speech so that those in power stay in power.

    For the record, I think any attempt of Marxism we have seen has started with violating it's biggest cornerstones: everyone equal, including those in 'power', and no personal ownership of stuff.
    Calling it by a different name with communism helps me more easily explain the difference to the ignorant who can only accept capitalism as valid. But think about this for a second:
    Capitalism works and thrives in a society of egocentric individuals.
    Marxism/communism works and thrives in a society of altruistic people.

    Which would you prefer to live in?

"The pyramid is opening!" "Which one?" "The one with the ever-widening hole in it!" -- The Firesign Theatre