China to open up VoIP market?

Speculation is growing that China could be about to relax restrictions on its voice over IP (VoIP) market.

A report last week in The Beijing News said the Chinese government has granted a VoIP licence to a southern Chinese telecoms company for a pilot programme, and telecom carriers and virtual network operators (VNO) will be allowed to apply for the licences starting in 2007.

So far Chinese telecoms operators that have received government approval to trial VoIP services declined to do so because they believed it would threaten their fixed-line services revenues, according to the newspaper.

An executive from Tom Online, a Chinese web portal, confirmed the news though with a slightly different timeline. Wang Leilei, CEO at Tom Online, told the Financial Times the Chinese government "is not going to issue VoIP licences until 2008".

The Chinese Embassy in London said it could neither confirm nor deny the reports.

Last November confusion broke out over whether Skype's VoIP services were blocked in China, after US-based Verso Technologies said a Chinese carrier was using the company's web filtering product to prevent the use of Skype and other P2P applications.

But Skype denied the report and said it was in talks with Chinese regulators and hoped it could soon offer SkypeOut in China.

Currently Chinese people can use Skype's software to make free PC-to-PC calls but not SkypeOut, due to regulatory restrictions.