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To: Slumdog who wrote (43115)	3/1/1999 8:42:00 AM
From: Glenn D. Rudolph	Respond to of 164684

China rings in lower telephone, Internet fees By Bill Savadove SHANGHAI, March 1 (Reuters) - China rang in lower telephone and Internet charges on Monday in a bid to deflect complaints about high rates as Beijing tries to make its telecommunications sector more market-oriented, industry officials said. China's Ministry of Information Industry said on Sunday it would slash fees for fast-growing Internet use by about 50 percent and international telephone rates by as much as 18 percent. But postage rates would rise by 20-60 percent as China tried to end the practice of having lucrative telecommunications services subsidise money-losing postal operations, it said. "There have been too many complaints from customers, so the areas they're reducing are the price of long-distance telephone calls from China to overseas and Internet fees," said an executive at a foreign telecommunications firm in Shanghai. "I think they're intending to make things more competitive and more market-oriented," she said. The cut in fees was tied to moves to respond to market trends, including a plan to split up state telecommunications giant China Telecom, industry officials said. Beijing is close to splitting China Telecom, the main operating company for telecommuniations services, into separate entities handling fixed line, mobile phone and paging businesses, they said. China would also cut charges on fixed telephone installation and opening mobile telephone lines, abolish administrative fees on local telephone call networks and cut fees levied on long-distance telephone calls, the Xinhua news agency said. Individuals using the Internet would pay four yuan ($0.48) per hour for the first 60 hours in a month and eight yuan for every additional hour, the official agency said. "Most of the research institutes and universities are interested in using the Internet for education or assisting their research work," one industry official said. "But they're the poorest and they cannot afford the current price." Internet-related companies welcomed the move, saying it would increase business. China was estimated to have more than two million Internet users at the end of 1998. "We of course welcome the cut," said an official from SINA, which provides content and services through its Chinese language web site. "For our company, it will bring more users." A spokesman for U.S. company Intel Corp <INTC.O>, the world's largest computer chip maker, said it had lobbied Beijing to lower rates for Internet users. "A country needs to embrace the Internet if the nation wants to be competitive," he said by telephone from Beijing. "One of the barriers from the development of the Internet is higher cost, so this is good news and we believe that this will further foster use of the Internet in China." The cuts were also good for telecommunications equipment producers as it could increase sales, though the benefits were offset by low profit margins in China, analysts said. ($1=8.28 yuan)