No.386 August 14, 2009
Special Issues  
USITO Supports the Annual Hebei IT Week
USITO Monthly Policy Call, August 27
 

USITO as the Supporting Agency will participate the annual Hebei IT Week on Sept.1-5 in Shijiazhuang of Hebei Province. Last year USITO brought a U.S. delegation to the event which was warmly received by top local officials. Though we don't plan to participate this year with a delegation, individual firms are welcome to explore the vast opportunities in this nearest province of Beijing. Key themes of this year's event include Solar Energy, Electronics Components, Fiber Cable, etc. Hebei CCPIT circular

Top Story

MIIT Minister: Green Dam Preinstallation in Consumer PCs Will Never Be Compulsory

At 10am August 13 Thursday, the State Council Information Office (SCIO) held a press conference, in which Mr. Li Yizhong, Minister of the Ministry of Industry and Information Technology (MIIT), expressed his stance that China will never force consumer PCs to pre-install the controversial Green Dam Internet filtering software. Key messages of Mr. Li's media statement include:

1. MIIT promotion for Green Dam is justified, since the primary purpose is to protect the kids;
2. MIIT has followed the legitimate protocol in the purchase of Green Dam;
3. Some U.S. and EU associations sent a letter to Chen Deming and Mr. Li himself, most of their opinions carry good intention;
4. A few individuals tend to exaggerate the case, such as using it to attack China's Internet policy, that is vicious;
5. MIIT will listen to more ideas before making decision on the next step. Computers in public schools, Internet cafes and other public places will continue to be mandated to pre-install the software.
6. For the vast consumer group, MIIT will respect people's freedom, and will never mandate all computers preinstall the software.

USITO members please click here for the full Q&A text. For the original Chinese text, please click here.

USITO Notes: MIIT earlier announced that all computers sold in China must be preintalled with the Green Dam software starting July 1, but due to strong domestic and overseas objections, the ministry announced to "indefintely delay" the policy in the evening right before the to-be-effective date. Mr. Li's remarks are encouraging to the industry, since it is the highest level official clarification that not all PCs are subject to the compulsory pre-installation (the June 30 MIIT clarification was from the anonymous MIIT "spokesman"), and it seems the decision will be long-lasting.

What remains controversial include: IPR issues of the software; the government procurement procedures; uncertainty on whether "non-mandatory" equals "no CDs in the package", etc. For instance, Mr. Li said that "parents have the choice whether or not to install the software, which is provided for free via a CD in the PC package"; if this is what he meant by "non-mandatory", the PC makers may still need to ship their PC packages with CDs. Given all those uncertainties, the industry shall continue to follow the development of this policy. Members are welcome to access USITO website member area for Green Dam issue.


EPEAT to Be Promoted Globally

On August 10, the U.S. Green Electronics Council announced that it plans to promote its EPEAT (Electronic Products Environmental Assessment Tool) system to more countries. EPEAT is a rating system for computers' product efficiency and sustainability attributes. According to Wikipedia notes, the system has been mandated in the U.S. government agencies, and the Council evaluates computing equipment on 28 criteria about their environmental performance rating. The ratings include either gold, silver, or bronze, and cover monitors and desktop computers right now.

The Green Electronics Council is an organization made up of manufacturers, recyclers, and advocacy groups. It is said that the Council plans to introduce the EPEAT rating system to more product series, such as televisions, printers, and copiers, and probably consumer electronics and servers.

In January 2007 the Bush Administration required all U.S. Federal agencies to use EPEAT when purchasing computer systems. The Green Electronics Council says it now has 1,300 products listed and participation of 30 vendors, which represents USD 60 billion in tech purchases. greenelectronicscouncil.org and wikipedia, 8/11/2009

USITO Notes: EPEAT is a rather comprehensive environmental rating system, as it addresses both EU¡¯s WEEE/RoHS directives and the U.S. environmental policies/standards. EPEAT is a different system from EnergyStar, it focuses more on the toxic materials and recycling activities.

China is one of the nine countries/regions beyond the U.S. where the EPEAT registry system is available. However, the awareness about EPEAT in Chinese computer industry remains low and much educational work needs to be done. The good thing is that Chinese stakeholders are increasingly interested on this environmental rating system, as we saw in recent years a number of bilateral meetings on EPEAT were held, such as the May 2008 Sino-U.S. EPEAT Seminar in Portland. The leading Chinese authority for EPEAT (China's correspondent agency to the Council) is China Environmental United Certification Center, an agency under the Ministry of Environment Protection. The Center signed a MOU with the Council in late 2008, and claimed it was greatly promoting the system in China.


U.S. Files WTO Case Against Chinese Film Industry, Stirring Mixed Reaction in China

Early this week the U.S. filed a case to the WTO against the protective policies by Chinese government in importing publications, audio and video products, and music download services from the U.S. China has committed to WTO to open up sales and distribution for these products and service, but clearly it is not fulfilling the commitment. On August 13, a WTO dispute settlement panel ruled that China's practices were inconsistent with international trade rules, and that China needs to revise them.

At the same day, however, the Ministry of Commerce stated its stance that "China has been performing its duty on publications market access, and we have been providing unblocked access to overseas imports of audiovisual products". Detail

Member in the News: SAP Releases Sustainability Report

The newly released Sustainability Report of SAP summarizes SAP¡¯s current and planned sustainability efforts. It details the impact of SAP operations on people, the environment, and the economy; the research and co-innovation activities focused on improving SAP's social, environmental, and economic performance; as well as the software solutions SAP provides to help customers address their own sustainability issues. The data in the report covers the period of January 1 to December 31, 2008. Detail

Selected Chinese Media Reports
 

3G Mobile Communication

China Mobile Plans to Complete WLAN Deployment by November

China Mobile has announced bid winners for centralized procurement of WLAN equipment for 2009, totaling 108,000 WLAN AP units worth RMB200m. Currently China Mobile is assigning different equipment suppliers for each province or municipality. Sources said that China Mobile required selected vendors to complete the delivery of equipment in 8 weeks and complete the network construction in subsequent 8 weeks, and the entire network is expected to be completed by this November. All participating vendors received a very strict 6-day technical testing for purpose of evaluation of technical packages submitted by bidders. What is noteworthy is that 20-30% of testing items deal with WAPI, and over 90% of selected suppliers are members of the WAPI Industry Alliance. Chinese Text

Premier: Combine Sensing System with TD Technology

On August 7, Chinese Premier Wen Jiabao went to WuxiHigh-techMicronanoSensingNetworkTechnologyR&DCenter, ChineseAcademy of Sciences, for an investigation. Wen said during the investigation that there are three tasks that should be given priority: 1) combine the sensing system with TD technology; 2) accelerate the development of the sensing network as one of the state key S&T special projects; and 3) try to build China¡¯s sensing information center as soon as possible. According to the Premier, China must rely on technology innovation and improve the competence of talents, cultivate new economic growth sources and acquire an advantaged position in economic development and technological innovation, to boost its sustainable development capability and competitiveness. Currently, many developed countries are increasing their investments in R&D of sensing technology. China has also included the R&D of sensing technology in its long-term blueprint for the development of science and technology. Chinese Text

Rumer: China Unicom Secures Deal with Apple Inc. on iPhone

According to a Chinese Business News report, an executive with China Unicom told the media that China Unicom has just secured a one-off procurement of five million units of iPhones for 10 billion yuan, around RMB 2,000 per unit. The first batch of iPhones of China Unicom version would hit the market in September in part of 3G business outlets of the telecom service operator. The report also says Apple Inc. has agreed to change its persistent business model of profit sharing for the first time. Chinese Text

Semiconductor

Core Chip Technology Granted to Domestic Firm

Jingxin Semiconductor signed a deal on transfer of mobile communication core technologies with Freescale and Motorola on August 7. The subjects of transfer include Freescale¡¯ s 3G baseband chip technologies and Motorola¡¯ s protocol stack technology. Jingxi Semiconductor plans to, after acquiring the assigned technologies, reorganize resources and develop 3G-4G wireless communication terminal chips and chip -based handset terminal solution. Jingxin Semiconductor was jointly established by Techfaith Wireless and Beijing Yizhuang International Investment and Development Corporation. This transfer of technologies will allow China to, when designing proprietary microprocessor chips, integrate mature, advanced technologies, shorten the development cycle, and bring chip design into line with prevailing applications. Chinese Text

Google to Buy On2 for USD 106.5 M

Sources said Google has agreed to buy On2 Technologies Inc. for USD 106.5 million, bolstering its YouTube site with technology solutions that compresses video clips so they are easier to download. It is said that On2 investors will get 60 cents in Google stock for each share they own. The purchase is expected to close in the fourth quarter of this year. The acquisition is the first announced by Google since September 2008, according to a report by Bloomberg News. Chinese Text

Software

Evermore Software to Launch Web-based Office

Evermore Software, based in Wuxi, Jiangsu, has designed a Web-based office software product, to compete with Google Docs and Microsoft¡¯s Office Web application. For long, Evermore Software has been delivering a Java-based Evermore Integrated Office for desktops, which is similar to Microsoft in icon and function. Currently, most of the work on WebOffice is completed, and the software has been published and is undergoing final testing. The software can operate with Windows and Linux. Most of its users are in China. Chinese Text

UFIDA Software Partners with Lenovo

UFIDA, China¡¯s top management software maker, and Lenovo, China¡¯s top PC maker, jointly announced on August 12 that they will enter into strategic partnership, carrying out all-round company-level cooperation in technology R&D, product, market, channels and sales. Lenovo CEO Yang Yuanqing said that this partnership can facilitate world-class total solutions for Chinese firms, ¡°This is not only a move responding to the industry trends, but also a wholesome attempt for software-hardware cooperation in China¡¯s IT industry.¡± UFIDA Chairman and President Wang Wenjing said that the cooperation between both parties will deliver highly integrated solutions and a technical platform for the innovation of business patterns for Chinese firms. Chinese Text

Trade & Investment

CAS Sells Lenovo Stakes

Last week, ChineseAcademy of Sciences State-owned Assets Operation Co., Ltd., as the controlling stakeholder of Lenovo, had Lenovo¡¯s 29% stakes it owns up for sale at China Beijing Equity Exchange, at a listed price of RMB2.755b. According to the spokesman of the company, the purpose of the sale is to introduce better corporate resources, improve the corporate governance system at Lenovo, and relying on the funds through selling of stakes, push forward the application of other technologies developed by research institutions. The seller announced strict conditions for assigning the stakes: the prospective assignee should be a domestic enterprise which shall own a public company in finance, energy or real estate field. The CAS State-owned Assets Operation Co., Ltd. with a total of 65% stakes in Lenovo, will remain the largest stakeholder of Lenovo. Chinese Text

China Technology Exchange Established

China¡¯s first national technology exchange entity --- China Technology Exchange was proclaimed in Beijing on August 13. With China Beijing Equity Exchange as its largest stakeholder, China Technology Exchange is intended to be China¡¯s technology exchange center. Du Zhanyuan, Vice Minister of the Ministry of Science and Technology, expressed his hope in his speech that China Technology Exchange could sum up and use previous experience, explore ways to perfect the systems, mechanism and standards on technology and equity exchange, innovate products and services, pool necessary resources, and forge a technology exchange platform with international influence. He expected the establishment of the exchange to push forward the development of a national technology market. Chinese Text

WTO: China Loses Publications Case

After nearly two years investigation, WTO concluded that China¡¯s restrictive measures implemented for import of video & audio and books and in foreign investor distribution market violated China¡¯s commitments to WTO. Ministry of Commerce spokesman responded that China will seriously evaluate the report of arbitral awards issued by the WTO panel, and is likely to lodge an appeal against the award. According to the spokesman Yao Jian, since its accession to WTO, China has been seriously fulfilling its WTO obligations in opening its publications market, and foreign publications, movies and video and audio have no difficulties in entering Chinese market. Sources said the publications case was submitted to WTO by U.S. in April 2007, and in November of that year, WTO decided to form a panel to examine the issues. 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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