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To: JohnG who wrote (31144)	5/27/1999 8:20:00 AM
From: JohnG	Respond to of 152472

China Railway Apppears set to String Fiber and become China's Second largest telecom. Thursday, May 27, 1999 TELECOMS Three new challengers for China Telecom WANG XIANGWEI Beijing has unveiled plans to launch three national telecommunications operators as part of its bid to break the virtual monopoly of China Telecom. The biggest challenge will come from the Ministry of Railways, which plans to upgrade its existing network and "easily become the second-largest player in China's telecommunications business", Xinhua news agency reported yesterday. The State Administration of Radio, Film and Television (SARFT) is also moving into the telecoms business by taking advantage of its national cable television networks. And SARFT has teamed up with the Chinese Academy of Sciences, the Ministry of Railways and the Shanghai municipal government to launch another company to provide Internet-based telephone and multi-media services. "China Telecom will soon find stronger competition in telecommunications and may risk losing its monopoly as more competitors enter the market, " Xinhua said. The official media has recently dropped hints that such companies would be established but the Xinhua report has indicated for the first time the extent of competition Beijing plans to introduce into the country's tightly controlled telecoms market ahead of mainland's possible entry into the World Trade Organisation. During the WTO negotiations, the United States and Europe have pressed Beijing to give foreign telecoms companies wide access to the world's fastest-growing market. The mainland has only three telecoms companies - China Telecom, which controls more than 95 per cent of the market, and the much smaller China Unicom and China Jitong, which pay China Telecom for the use of its networks. The Ministry of Railways already had a complete nationwide network, including 120,000 kilometres of telecommunications lines, 66,000 long-distance lines and 4,593 kilometres of digital microwave lines, second only to that of China Telecom, Xinhua said. The ministry is preparing to set up China Railway Telecommunications and Information Group, "which will be able to do exactly what China Telecom does". "We have no problems in getting permission and a licence from the State Council, and once approved, the company can provide comprehensive telecommunications services within six to eight months, after having improved its networks," Xinhua quoted ministry official Peng Peng as saying. Mr Peng, who is in charge of setting up the railway telecoms concern, said government officials had basically approved the establishment of the company. He said at present, the railroad network has a capacity of only 1.5 million lines, 1 per cent of China Telecom's capacity. But Mr Peng said the capacity could be increased by more than 10-fold. The railway network has provided channels for China Unicom's GSM (global system for mobile communications) cellular phone system and other services for China Jitong. Due to historic reasons, the mainland's railway system, like the armed forces and other strategic industries, have set up their own telecoms networks. Now Beijing has encouraged it to move into commercial areas. Meanwhile, SARFT plans to set up "China Cable Television Networks Corp" to conduct telecoms business. The cables, owned by Beijing Cable TV had already been used for data exchanges and for several internal ministry networks under the state council, Xinhua said. SARFT's joint venture with its three new partners, approved by the government last month, would also provide telephone and on-line services, the news agency said. It will utilise the existing wide-band optical-fibre networks operated by SARFT and the Ministry of Railways.

To: JohnG who wrote (31144)	5/27/1999 10:43:00 AM
From: Valueman	Respond to of 152472

John: I would agree with your description of China's "modus operandi." The demand for local manufacturing so they can "gain" the technology is their favorite ploy. Take the technology, screw your partner, and go on. That's why so many companies have bailed on joint ventures there. Why bother? I would imagine collecting royalties there will be a nightmare.

To: JohnG who wrote (31144)	5/27/1999 10:45:00 AM
From: quidditch	Respond to of 152472

China 10 years of Technology Transfer. China has, during the last 10 years, been very shrewd in negotiating technology transfer agreements with many multinationals in exchange for allowing them to establish manufacturing plants, or for rights to sell product in, China. While the technology transfer license has what might be called customary IPR protection and restriction on unfettered use or transfer to unauthorized parties, it is widely believed that these terms have not been followed or enforced to the letter. The only thing I can think of would be to treat ASICs like software and protect the "source codes" themselves and prevent them from being disclosed. Not sure if this is relevant in the case of a chip. Regards. Steven