ABSTRACT
This paper examines the evolving role of the government in building the infrastructure
for, and managing the movement of, information in China.1 To date, there have been few research works on the topic, despite the fact that China is now the second largest telecommunications market in the world. Most of the literature has focused on Internet development (Wu 1996, Tan 1999, Loo 2003), comparative analyses (Yan and Pitt 1999, Yan 2001), and the question of whether China would adhere to the Fourth Protocol of the World Trade Organization (WTO) (Zhang 2001). The reasons behind the changing policies of the Chinese government towards the information and telecommunications (ICT) infrastructure have not been systematically analyzed in light of the changing domestic and international circumstances and the interplay of various powerful parties with vested interests. Moreover, many studies (including Gao and Lyytinen 2000, Yan 2001, Zhang 2001) did not take into account the rapid developments since the latter half of 2000. In particular, the promulgation of the Telecommunications Act in September 2000 and the remarkable organizational reforms since June 2001 were extremely important milestones in the transformation of China’s telecommunications sector. This paper provides an explanatory framework for understanding the evolving role of the Chinese government in these developments. This first section outlines the aims, objectives, and organization of the paper. The second section describes the highly centralized and monopolistic telecommunications industry in China until the mid-1990s. The third section highlights the changing institutional framework, which enabled a dramatic growth of Chinese Internet domains and users since the late 1990s. The fourth section examines the attempts of the government to control the flows of information on the ICT infrastructure, and the last section concludes by explaining these changes as an intricate balance of political and economic considerations.
