China Telecom will embark on the commercial launch
of Vnet Messenger, its instantmessaging software,
for 2004, according to a Chinesenews Web site.
An unidentified China Telecom employee told China
Internet Informatin Centers China.org.cn that there
had been a significant financial investment in Vnet
Messenger (VIM) development in a China Telecom
branch in the Guangdong province. The software,
which is designed to handle voice over Internet
Protocol telephone calls, file transfers and
Internet meetings, is currently being tested.
The employee also told the Web site that China
Telecom saw the software as a way to stem losses to
rivals instantmessaging systems. With VIM, losses
from China Telecoms traditional telephone services
to instant messaging can be directed to China
Telecoms own IM service.
China.org.cn reported that China Telecom
experts said VIM would focus on entertainment
services such as online games and ringtone
downloads. VIM will be packaged with a fixed
telephone service, email and, later, with 3G
(thirdgeneration) phone services. The Chinese name
for VIM has not yet been announced.
As instant messaging becomes more popular,
easiertouse and featureenhanced, Asian consumers
are switching from the traditional telephone to
instant messaging for communicationa trend already
appearing in the United States and Europe.
The market leader for instant messaging in China
is QQ, developed by Tencent, a Chinese company.
China.org.cn said the total number of MSN Instant
Messenger and QQ users in China was close to the
number of telephone users.
Chinas Ministry of Information Industry began
examining valueadded service provider (VSP)
qualifications and licensing in August 2003, and it
is possible that the ministry will soon begin
licensing VSPs. Some local companies have already
been licensed for commercial experimentation in
China.org.cn said foreign enterprises would
probably find it easier to enter the VSP industry
than to enter traditional telecommunications fields.
The news Web site estimated there were more than
3,000 VSPs in China, together with several hundred
Internet service providers and foreign VSPs, making
for a very competitive virtualservices market.
China Telecom may also be restricted
geographically, as it is a telecom company, while
multinational corporations such as Microsoft and
Yahoo have greater worldwide reach for their
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