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Skype Illegal in China?

Thanks to the East Coast blizzard of 2010, it took me five days to travel back to Beijing from my vacation. So there was much joy and relief at landing today.

But it was all short-lived after being greeted by (1) gale force winds and temperatures below zero and (2) the news that Skype may soon be unavailable in China.

The People’s Daily, a Chinese-language newspaper run by the Chinese Communist Party, reported today that services providing voice over Internet protocol (VoIP) would be illegal unless they’re provided by telecom carriers China Unicom and China Telecom.

Technically, Skype is illegal in China, according to the Ministry of Information and Industry, which is responsible for granting VoIP licenses.

What’s more, China -- which counts 450 million Internet users – is the largest market for internet phone calls, which cost far less than landline calls. That also means unlicensed providers like Skype are cutting into a lucrative market for the state telecoms.

In October 2009, the top Chinese VoIP – UUCall, with 30 million registered users – was suspended by a provincial telecoms bureau. The company reopened for business last February by relocating its domain name in Hong Kong.

On Sina.com’s microblog, many users criticized the decision by the Ministry of Information and Industry. “The Ministry of Information and Industry must be desperately poor,” observed a Chinese woman who goes by the name Amanda114.

If Skype is blocked (and it's not clear when that would happen), it would join a club of illustrious Western Internet companies that includes Facebook, Twitter, and YouTube.

With additional research by Zhu Tong