No.380 July 3, 2009
Special Issues  
MIIT Infosec Department Chief Meets USITO
USITO Co-Hosts Forum on Sustainability of Comsumer Electronics, July 10 Qingdao
 

On June 23th, Mr. Zhao Zeliang, Deputy Director General of the Information Security Coordination Department of the Ministry of Industry and Information Technology (MIIT), met with the USITO delegation led by Dr. John Chiang, Mark Bohannon and John Neuffer. Both sides exchanged views on a variety of infosec issues, including the new CNCA directive, multi-level protection scheme, the U.S. infosec practices, etc. Both sides agreed to regularly compare notes for this issue. MIIT official report
Top Story

Green Dam Software Pre-installation Requirement Delayed

In the evening (8:25pm) of June 30, 2009, hours before the predetermined enforcement date, China's MIIT announced in its website that it agrees to "indefinitely delay" the mandatory installation date for the controversial "Green Dam - Youth Escort" Internet filtering software on new computers.

As reported in the recent issues of USITO weekly newsletter, MIIT has mandated that all computers produced or sold in China be installed with such software after July 1, 2009. Official statement said the software is designed to block violence and pornographic contents on the Internet to protect minors. It could also help parents control how much time their children spend online.

The MIIT announcement takes the format of Q&A with the press - the statement lists seven brief questions, followed by answers from MIIT, with no officials' names mentioned. Key points of the statement include:

* MIIT will continue soliciting opinions to perfect the pre-installation plan;
* Free downloads of the software remain available; schools and Internet bar computers will continue to be installed with the software after July 1, 2009;
* The statement reiterates that the pre-installation can't be regarded as compulsory, since the software could be easily switched off and uninstalled by computer users, and will not collect the online activities of users or collect any information about users;
* Accusations of the software's privacy invasion and blocking information flow is "groundless and irresponsible";
* Developers of the "Green Dam," greatly concerned over software security, modified the software as technical problems had been revealed during earlier promotion. They will continue to improve the software with services packs and upgrades.
* The government procurement procedure of the software had complied with China's Government Procurement Law, which was open, fair, transparent, non-exclusive, and under strict supervision.
* The procurement of such filtering software is "an act for public good", and is in line with regulations of the World Trade Organization (WTO).

USITO members please click here for USITO translation of the MIIT media statement. This link is the original Chinese copy is here:
http://www.miit.gov.cn/n11293472/n11293832/n11293907/n11368223/12433840.html

USITO Notes: This is the second time that MIIT has ever changed its stance to delay enforcement date fir a controversial IT policy, with the first one being the WAPI issue. Experts say pressure from the international community was one reason, as the rule poses big challenges to international PC makers and hardly anyone is able to install the software immune of adverse impacts. Last week USITO on behalf of its five U.S.-based parent associations submitted a joint letter of 22 associations to Premier Wen Jiabao, voicing concerns and disagreement with the directive. While applauding such wise decision from MIIT, we may need to keep alerted against the resurfacing of the issue in the near future, as this urgent announcement from MIIT doesn't specify when the pre-installation requirement would resume its effect, in addition, there is no signs that the ministry will choose to scrap the policy in the future, given most of the seven Q&As reiterates the importance of the filtering software. As the following statement (the 7th Q&A) states, after some "step-by-step" work, it may rear its head again:

"In early March 2009, our ministry convened a meeting with major computer companies to exchange the pre-installation work for computer filtering software. We got many computer companies' support, based on which we decided the pre-installation date. Recently, some companies raised their concerns to us that the work load is too much, time is too short, and hard for preparation. So, according to the real situation, it is acceptable to postpone the pre-installation. Based on the principle of sticking to the overall direction and implementing step by step, we will continue to provide free Internet download, install filtering software in middle and primary schools, Internet bars and computers in other public places, and encourage computer companies which have already installed the software to actively expand the market. In terms of the pre-installation issue for other computers, MIIT will further solicit opinions from various parties, perfect the proposal, improve the working method as well as other relevant works. "

We will continue to closely watch the development here, and keep providing readouts for any resurfacing symptoms. We also look forward to working with members to see how the discussion can move forward.

NDRC and MOFCOM Clarify China's Persistent Stance on Fair Competition

On June 26, 2009, two Chinese ministries, the National Development and Reform Commission (NDRC) and the Ministry of Commerce (MOFCOM) held press conference in Beijing, clarifying to the media that they will by no means reinforce any "protectionist" policies, the circular they issued days ago was widely "misread" by the international community and the media; actually it is "fair and justified", and does not carry any discriminating terms against foreign products.

Earlier of the month, nine Chinese ministries, led by NDRC and MOFCOM, requested preference for domestic products by issuing the circular" Notice on Further Strengthening the Supervision of Public Bidding Activities Conducted for Construction Projects", which rules that all projects fall under the 4-trillion Chinese government stimulus package shall give preference to domestic products, and any misconduct will be "punished". www.gov.cn, 6/26/2009

USITO Notes: The 9-ministry circular has triggered mass debate shortly after it is released. Even Chinese premier Wen Jiabao has told press that his government is not intentionally forging "buy China" policy, instead policies like such are aimed to regulate the malpractices in government procurement work.

We have prepared a draft translation of the two ministries' clarification statement, members please click here to see the full text. In the statement, we found that the 9-ministry interprets the ¡°domestic product¡± much broader by including all foreign products produced in China, which may not be agreed by other ministries such as the Ministry of Finance (MOF), who didn't sign in the 9-ministry circular. In addition, without MOF signing, the circular is less authoritative to interpret related GP rules.

Member in the News: Nokia to launch Chinese Ovi Store in 2009

Nokia plans to launch a Chinese version of its Internet Ovi Store in the China market by the end of 2009 as China's mobile Internet service market is set for robust growth in the coming years, according to sources at Nokia Greater China.

With 180 million Nokia handset users in China at the moment, Nokia also foresees strong demand for access to Internet throught mobile phones in the future. Detail

MIIT Approves Wireless Broadband Standard McWiLL

MIIT approved McWill as a industry standard on 15th June, which will come effective on 1 September. McWiLL is the most advanced broadband wireless solution provided by Beijing Xinwei Telecommunications Technology, Inc. The technology is based on SCDMA, still used in China in the 400MHz band, and is known as Multicarrier Wireless internet Local Loop (McWiLL). It's been in field trials in a few Chinese cities, including Guangzhou and Qingdao, where it's been used for video, voice and data communication. Detail

Selected Chinese Media Reports
 

Regulations

New Policies Announced to Regulate E-Money

The Ministry of Culture and Ministry of Commerce jointly published the Circular on Strengthening the Management of Virtual Currently Used in Online Games. The Circular was published to respond to new situation and address new problems encountered in managing the virtual currency used in online games. The Circular, for the first time, defined the scope and threshold for use of online game virtual currency, specified the responsibilities of online game service providers, and announced sanction measures against crimes in this market. Chinese Text

Household Appliances Trade-in Rules Released

Seven ministries and commissions, including the Ministry of Finance and Ministry of Commerce, jointly published the Measures for Implementation of Household Appliances Trade-in for New Appliances, making rules for subsidy standards for household appliances trade-in for new appliances, procedures and implementation agencies. This is another key move approved by the central government following the release of the ¡°Household Appliances for Farmers¡± policy, aiming to stimulate domestic demands. The trade-in program can facilitate expanding domestic demands for consumables, improving the utilization efficiency of resources and energy, reducing environmental pollution, accelerating the energy conservation and emission reduction and development of the cyclic economy, and pushing the upgrading of industries and economic restructuring. Chinese Text

CATR Calls for More Competition in China's Telecom Market

A report on comparison of Chinese and European telecommunication laws pointed out that China should push forward the competition of China's telecom market through transforming telecom regulation means and implementing privatization of enterprises. This report is part of the EU-China Information Society Project. This study was jointly conducted by China Academy of Telecommunication Research of the Ministry of Industry and Information Technology and Westf?lische Wilhelms-Universit?t M¨¹nster, on many important issues concerning formulation of Chinese telecommunication law. According to the report, the privatization of enterprises is a crucial step in promoting competition. Chinese Text

NCA Officials Call for New Means to Crack Down on Internet Piracy

Wang Ziqiang, Director-general of the Department of Copyright of the National Copyright Administration, said on June 29 that China 's current anti-network piracy efforts fail to yield anticipated results, and traditional measures cannot serve purpose any more. According to Wang, traditional technological means cannot respond well to high-tech-based piracy behaviors, and cannot effectively spot such behaviors throughout the vast Internet. He suggested that high technologies be utilized fully to create new, effective anti-piracy means, and at the same time, some mature experience be used for reference to build a network copyright supervision platform in China . Chinese Text

Internet

Google: Disagreements with Chinese Government Resolved

According to a foreign media report, Eric Schmidt, Google CEO, said that Google has removed disagreements with Chinese government and agreed to withdraw the contents in dispute. Schmidt confirmed that Google China has resumed online operation. He expressed his willingness to continue to communicate with Chinese government on how to address the issues of Chinese government's concern. In June, Chinese authorities announced enforcement measures against Google for spreading large amount of porn contents on Internet, suspending Google's webpage search services, and ordered a rectification to be made immediately. Chinese Text

  

3G Mobile Communications

China Mobile to Launch LTE Tests Next Year

China Mobile is expected to launch large-scale tests for its TD-LTE network next year. Huang Yuhong, Director of the Network Technology Department of China Mobile Research Institute, said that China Mobile is planning to conduct large-scale LTE outfield tests in a few cities in the second half of 2010, with a downlink rate of 100Mbps. According to Huang , China Mobile has drafted a test plan, and will carry out TD-LTE demonstrations in the 2010 World Expo to be held in Shanghai . Most of TD-LTE chips are said to be commercialized by the end of 2010. Chinese Text

Huawei Wins 3G Contract from Finland

On June 25 Huawei signed a deal with TeliaSonera to supply of telecommunication equipment. Chinese Vice Premier Li Keqiang, who was on a visit to Finland, witnessed the signing of this contract. Huawei will deploy the Europe's first software radios technology-based SingleRan commercial network in north Finland, on behalf of TeliaSonera. Finland is said to be the core customer base of the telecom giant Nokia-Siemens. Chinese Text

China Mobile Expands Investments in Pakistan

According to a Pakistani newspaper report, China Mobile will continue to expand its investments in Pakistan this year, planning to invest another USD 500m to expand the capacity of the mobile network of CMPak, its Pakistani subsidiary. Currently, CMPak has constructed a total of 4500 base stations in large and medium cities across Pakistan. China Mobile acquired Pakistan 's fifth largest mobile operator Paktel in the beginning of 2007 and established CMPak. Chinese Text

Trade & Investment

National Cartoons Industry Bases Settle in Beijing

An inauguration ceremony of ¡°National Cartoons Industry Bases¡± was held this week, where the certificates of the ¡°National Cartoons Industry Base¡± were issued to three culture & creative industry zones, settled in Districts of Haidian, Shijingshan and Tongzhou respectively. Officials of the three industry zones vowed to deliver full support to cartoons enterprises, increase investments to build a public technology service platform for these cartoons enterprises, and leverage the national and municipal preferential policies to promote the development of the cartoons industry in Beijing . Chinese Text

Lenovo Fuels Marketing Efforts in India

Lenovo published 7 new computer designs in India , and announced its plan to publish 50 new computer types in Indian market this year. With a view to capturing emerging markets, Lenovo expected to copy its growth pattern from China to India , as part of its expansion plan. 30 retail shops will be set up, leading to a total of 150 shops in India . The number of service centers will increase to 250 from current 130. Now Lenovo has a production factory in Puducherry , India , with a production capacity of 3 million computers annually. Chinese Text

Semiconductor

Shenzhen: IC Design Output Value Ranks First in China

Sources said through years of rapid development, Shenzhen's IC design industry has grown a mature one, exceeding RMB6.1b in IC design output value last year, ranking the city the No. 1 among Chinese cities. Shenzhen also published its 5-year blueprint for IC industry, saying that IC design industry sales will reach RMB20b. IC design industry is one of the fastest growing industry in Shenzhen. According to a Shenzhen official, since the creation of the IC base in Shenzhen, large numbers of IC design enterprises have come to the fore, spurring the rapid development of the IC industry and continued improvement in indigenous innovation capabilities. Chinese Text

  

USITO selected and translated the news summaries above. If you are interested in learning more details about the above Chinese language links, you are welcome to contact us (wenjie@usito.org) to sponsor the translation of that report.

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