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To: jmhollen who wrote (4722)	9/20/1999 11:28:00 PM
From: jmhollen	Read Replies (1) \| Respond to of 7209

"....From the jus' so's ya know Department...." China to launch new telecom firm ASSOCIATED PRESS BEIJING, Sept.19 — China will launch its third major telecommunications company next month in its attempts to bring competition to a sector long dominated by a government monopoly, the official China Daily reported Sunday. China Netcom Corp. is using $50 million in government funds to offer high-speed data services for big businesses and Internet service companies in 15 cities, the newspaper reported in its Business Weekly edition. Another round of price cuts is likely later this year, following reductions in March for Internet and phone services, China Daily reported, quoting Zhang Cunjiang, a telecommunications regulator. CHINA NETCOM will use Internet Protocol technology, which helps networks run faster and more efficiently, the newspaper said. Its network will initially rely on fiber-optic lines owned by two of its four government founders, the Ministry of Railways and the agency that regulates broadcasts. Despite the government's desire to use limited liberalization to spur innovation in telecommunications, China Netcom will face stiff competition from China Telecom, the dominant phone company. China Telecom enjoys strong backing from its former owner, the Ministry of Information Industry, which regulates the sector. It has used those ties to try to keep the country's second telephone company, China Unicom, from developing into a competitor. Ministry backing, however, has not fully protected China Telecom. Consumer complaints and government eagerness to tap the Internet for economic growth have forced China Telecom to reduce charges. Another round of price cuts is likely later this year, following reductions in March for Internet and phone services, China Daily reported, quoting Zhang Cunjiang, a telecommunications regulator. Although Zhang did not provide details, the China Daily cited unidentified sources as saying that Internet charges will drop by half from the current 50 cents an hour. March's price cuts spurred consumption. According to Ministry of Information Industry statistics, in the first eight months of the year fixed-line customers rose 14 million to more than 100 million and mobile phone users increased nearly 11 million to 36.2 million, the newspaper said. Internet use in the first half of the year nearly doubled, from 2.1 million users in the end of 1998 to 4 million, China Daily said.