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Subject:      CND-China, June 30, 1999 (CN99-07)
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+-+-+-+-+-+-+-+-+-+   C h i n a   N e w s   D i g e s t    +-+-+-+-+-+-+-+-+

                       Internet Technologies in China

                           (CND-CN, No. CN99-007)

                              June 30, 1999

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                                ISSN 1024-915X

Table of Contents                                                 # of Lines
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1. News Brief (7 Items) ................................................ 175

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1. News Brief (7 Items) ................................................ 175
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  (1) Experts Urge E-Commerce Awareness in China
  (2) Phone Penetration Climbs, Reaching 125 Million Subscribers
  (3) Shanghai Bank Pass Weekend Y2K Test "with Flying Colors"
  (4) Internet Usage, E-commerce to Boom in Asia
  (5) China.com to List on Nasdaq
  (6) Authorities Threaten to Blacklist Firms for Y2K Price Inflation
  (7) China's Internet Users to Exceed 33 Million by 2003: Study
                          ____   ____   ____

(1) Experts Urge E-Commerce Awareness in China

[CND, 06/18/99] Internet experts in China warn that the country's progress
in developing e-commerce is being hindered by China's lack of of awareness
of its value, Xinhua reported.

Experts noted that if and when the value of e-commerce is fully understood
by Chinese people and enterprises, the country will speed up its
utilization and might even catch up with the western world in terms of new
technology.

GUO Weiqiong, manager of Magic Media, a marketing company in the high-tech
industry, thought that technically China is only less than two years
behind most western countries in e-commerce development.

"Many western countries have not completed the infrastructure for
e-commerce, which has given China time to catch up and learn from their
experience," Guo said.

However, many thought it is not technical problems that are blocking
progress.

CHEN Libo, an official with the State Economic and Trade Commission's
information center, said that China has almost no laws and regulations
concerning e-commerce, and therefore the gap between China and western
countries is not so narrow.

Yang Baosheng, who works for Chinanet thought that "The government should
let the public be aware of the coming information age, and enact related
laws and regulations."  (Ray ZHANG, Charles MOK)
                          ____   ____   ____

(2) Phone Penetration Climbs, Reaching 125 Million Subscribers

[CND, 06/18/99] The number of phone subscribers rose by more than 15
percent in the first quarter of 1999, AFP reported quoting statistics from
the Ministry of Information Industry.

Of the total increase of 17.8 million subscribers, 7.3 million purchased
land-line phones.  By the end of April this year, there were 125 million
subscribers, reaching a 11.37 phones/100 people penetration.

Revenue for the telecom sector for the first quarter this year increased
32% from the same period last year.  (Ray ZHANG, YIN De An)
                          ____   ____   ____

(3) Shanghai Bank Pass Weekend Y2K Test "with Flying Colors"

[CND, 06/22/99] Banks in Shanghai, China's financial capital, passed
weekend tests for Y2K bug "with flying colors," AFP reported quoting
Shanghai Star.

Citing a preliminary report by the Shanghai branch of the Central People's
Bank of China, Shanghai Star said all 17 of the commercial banks that
participated in the Y2K tests resumed normal operations at noon on Sunday.

About 2,100 automatic teller machines (ATMs) across the city were shut
down for the 24-hour test period; so were credit-card payment services at
8,700 retail outlets.

According to SUN Baodong of the Industrial and Commercial Bank of China,
the banks rolled forward their computer systems' clocks to Y2K and
conducted simulated ATM and point-of-sale transactions of various kinds.

"The results were very encouraging, for none of the deals were denied by
the machines," Sun said.

However, a local banker speaking on condition of anonymity did tell an AFP
reporter that the tests flushed out minor technical problems.  According
to him, those technical problems uncovered were relatively few and not of
a serious nature and that "finding these things now is a good thing."

The report was the first public disclosure of results from the national
trial.

According to the paper, more tests covering inter-bank and inter-city
transactions are scheduled to be conducted in July and September.  (Ray
ZHANG, YIN De An)
                          ____   ____   ____

(4) Internet Usage, E-commerce to Boom in Asia

[CND, 06/24/99] Internet-related business will take off rapidly in Asia,
US-based investment firm Morgan Stanley Dean Witter said, AFP reported.

At the firm's conference on Asian technology and E-commerce, Morgan
Stanley chairman John Wadsworth Jr. said that "A phenomenon like Silicon
Valley will develop in Asia in a much shorter time."

"This industry can easily be worth in Asia, numbers like 200 billion (US)
dollars in the next three to five years."

The firm believes that Internet usage in Asia will rise five fold-- from
eight million to 40 million subscribers--within the next five years.

The firm further forecasts that the number of personal computers sold in
Asia will grow by an average 22 percent each year for the next five years,
compared to 11 in the US and 14 percent globally.

Internet-related industries, E-commerce and telecommunications in
particular, are expected to blossom in Asia.  (Ray ZHANG, YIN De An)
                          ____   ____   ____

(5) China.com to List on Nasdaq

[CND, 06/25/99] Hong Kong-based Chinese-language Internet service
provider, China.com Corp., said that it wanted to raise $68 million with
an initial public offering of stock in the US, AFP reported.

China.com said it has registered with the U.S. Securities and Exchange
Commission to sell more than 4.2 million shares at $14 to $16 each in the
IPO on the Nasdaq Stock Market.  The offering is being underwritten by
Lehman Brothers and Bear Stearns.

China.com is 25 percent owned by US-based America Online, 22.7 percent
owned by Hong Kong-based New World Infrastructure, 13.6 percent owned by
China's official Xinhua News Agency.

AOL previously owned 10 percent of China.com.  Under a special agreement,
it increased its shareholding to 25 percent.  (Ray ZHANG, YIN De An)
                          ____   ____   ____

(6) Authorities Threaten to Blacklist Firms for Y2K Price Inflation

[CND, 06/25/99] Officials in Guangdong provincial and Guangzhou municipal
governments are threatening to blacklist computer software and hardware
providers who have been refusing to fix Y2K problems or setting outrageous
prices for such services, AFP reported quoting the Wenhui Daily.

Under the decree from the local authorities, blacklisted firms would see
their products and services banned from the Guangdong market.

According to the paper, some suppliers had "exploited their technological
monopoly to set any price they wish" for solutions to the Y2K bug.

XU Xidong, an official with the provincial government's Leading Group on
Y2K, said some firms had refused to take responsibility for
non-Y2K-compliant products they had sold.

"The problem is especially pronounced in some hospitals, as a lot of
medical equipment is highly automated," Xu said.

According to the Wenhui Daily, of the six industries that are the focus of
anti-Y2K work, all except railroads, i.e., transport, power, health,
telecommunications and posts, had complained of "non-cooperative"
technology suppliers.  (Ray ZHANG, YIN De An)
                          ____   ____   ____

(7) China's Internet Users to Exceed 33 Million by 2003: Study

[CND, 06/28/99] China is the fastest-growing Internet market in Asia and
will soon become one of the world's leading markets in the next five
years, AFP reported citing results of a joint US-Chinese study.

The number of Chinese Internet users is growing at a rate of 60 percent
annually.  The number is expected to exceed 33 million by 2003, turning
china into one of the world's leading Internet markets.

According to the study, the value of the Internet sector is is expected to
exceed 160 million dollars in 1999.  (Ray ZHANG, YIN De An)

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