A local arm of China Telecom, the country's biggest fixed-line telecommunications operator, has moved to block access to a computer-to-telephone call service offered internationally by Skype, the European internet telephony company.
Skype does not offer the fee-paying “SkypeOut” service to mainland Chinese users of its software and the action against it by the China Telecom unit has not affected the European company's free computer-to-computer telephone service.
The clampdown will affect people who have registered for the SkypeOut service outside China. Most are expected to be Hong Kong business people resident in China, or other expatriates.
However, the action by the unit Shenzhen Telecom in the southern province of Guangdong highlights the concerns of Chinese operators about the impact of “voice over internet protocol”, or VoIP, telephone services on their businesses.
SkypeOut allows users of Skype's software to make calls from their computers via the internet to fixed-line or mobile telephones around the world at rates far lower than those charged by conventional telecoms companies.
Such services threaten the core business of the state-controlled but internationally listed fixed-line operators, China Telecom and China Netcom.
Beijing has tolerated computer-to-computer internet telephony while seeking to limit VoIP services that more directly challenge the fixed-line operators.
An employee at a Shenzhen Telecom service centre said staff had been instructed to tell customers who complained about being unable to access SkypeOut that such internet telephone services were illegal in China under a 2004 regulation because they would “destroy market order”.
An employee of China Telecom in Guangzhou, capital of Guangdong province, said the operator had the technical means to block access to SkypeOut, but gave no details.
It was not clear if SkypeOut was being blocked in other areas of China.
Tom Online, an internet portal that is Skype's partner in China, said it had not heard any complaints from users about access to the service it offers in China, which does not include SkypeOut.
Tom Online has been seeking to work with Chinese operators to introduce new services, but currently has no schedule for introducing SkypeOut.
Other internet companies including Microsoft arm MSN also offer computer-to-computer telephone services in China.
The Chinese government has allowed the country's main state-controlled telecommunication companies to offer telephone-to-telephone VoIP services, which they offer mainly through pre-paid telephone cards as a way to compete against each other.
However, regulators have banned other companies from entering the business.
Despite such efforts, local market analysts have estimated that more than 200m minutes of “underground” international and long-distance VoIP calls worth Rmb190m ($23m, €19m, £13m) were made in China in the first half of 2005.
