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Home >> Business
UPDATED: 17:13, November 30, 2004
China's top online companies joint hands to regulate Internet wireless service
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The Internet Trust Alliance, co-established by China's top Internet companies Sina, Sohu and Netease, proclaimed self-disciplinary regulations for China's Internet wireless service providers (SPs) Monday in Beijing.

The move was taken after the Ministry of Information Industry took strict regulatory measures to eliminate pornographic content and unreasonable charges, which have reined in the rapid growth of the short message service (SMS) sector, as shown in the Internet companies' financial reports.

The new self-discipline regulations highlight a transparent charging system, and legal information content with no pornographic implications.

"We will put continued and serious efforts into the establishment of a new CTWS (Client Trusted Wireless Service) brand, and with the tremendous combined influence of Sina, Sohu and Netease, a healthy and orderly environment for China's Internet wireless service development will soon be created," Sohu CEO Zhang Chaoyang was quoted as saying.

Talking about Sohu's losses in wireless service because of what it termed "strict governmental regulation," Zhang said that his company was aiming at long-term benefits and a short-term slowdown in wireless service would not curb the company's overall development.

The Internet alliance will make a quarterly evaluation on the Internet service providers' performance and award a qualified service a CTWS certification for compliance.

"Sohu, Sina and Netease, originally competitors in the Internet industry, are now standing together to regulate performance and co-operate to guarantee a trusted service to our clients," Ding Lei, CEO of Netease was quoted as saying.

Along with the wireless service industry's development, more content will be added to the self-discipline regulations, which will bolster the industry's sustainable growth and may also provide valuable experience for other industries, Ding said.

Before the government's strict regulations on the Internet SPs' operations, many Internet users often complained about spreading pornographic information through the Internet short message service (SMS), and "subscription pitfalls" where they would be charged several dollars a month if clicking the wrong button by mistake or submitting a default selection designed by the SPs, according to industry sources.

In order to improve the SMS market, the Ministry of Information Industry, therefore, launched a campaign to check up on China's Internet service providers in July this year.

Many of China's Internet companies, including Sohu and Sina, were punished by suspension of some of their wireless service due to violations of the regulations.

Internet companies involved in wireless service, consequently, suffered from a revenue decline in their wireless service business. Sina's SMS third quarter revenue dropped by 6.6 percent compared to the previous quarter, Sohu's wireless service by 30 percent and Netease's wireless related service by 16.4 percent.

The tripartite Internet alliance among Sina, Sohu and Netease, was formed in September.


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