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Chinese Vice Premier Zhang Dejiang Wednesday said the country should step up efforts to promote the development of third-generation (3G) and domestically-developed TD-SCDMA technology.

Zhang urged accelerated construction of the 3G network, strengthened technological innovation and enhanced information security management, during a visit to the country’s four major 3Goperators including Datang Telecom, China Telecom, China Unicom and China Mobile.

Zhang said the 3G technology should be given full play to promote the informationization and upgrading of the traditional industries and boost the development of modern service industries.

He required the four major telecom operators to make unswerving efforts to develop the TD-SCDMA technology, explore new business opportunities and improve the construction of a full-fledged industrial chain, so as to sharpen the competitiveness of the TD technology.

China’s television home shopping industry is experiencing a reshuffle with the rise of State-owned TV home shopping companies and channels.

Hunan TV, a satellite TV company owned by Hunan Province, announced Tuesday that it would set up a joint venture with taobao.com, the country’s largest online retailer, with a registered capital of 100 million yuan ($14.64 million) to develop a TV version of Taobao, as well as a separate shopping website.

“The new company will integrate the business advantages of TV and Internet media and satisfy consumers’ various demands for consumption and entertainment,” said Ma Yun, Taobao founder and CEO, said at Tuesday’s press conference in Changsha.

The start up also meets with new government encouragement for TV stations to expand their home shopping businesses on the Internet and mobile phones.

“The integration of different direct sales channels such as the Internet, TV and catalogs will become a trend,” said Cao Fei, a senior e-commerce analyst at Analysys International, a consulting firm.

Home shopping on the rise

China Central Television and a dozen provincial satellite TV stations also have TV home shopping companies and channels, such as China CCTV Shopping Corporation, Shanghai Oriental CJ Company and Zhejiang Haoyigou Home Shopping.

Shanghai Oriental CJ Company, a joint venture of Shanghai Media Group and South Korea’s CJ Home Shopping Company, created Oriental CJ Family Shopping in April 2004 to sell products ranging from mobile phones to gold, diamonds and automobiles.

The company’s sales revenue is expected to achieve 2.8 billion yuan ($409 million) in 2009.

“We plan to sell property in our programs next year,” Jin Xingshou, chief manager of Oriental CJ, told Oriental Morning Post.

The increase of home shopping companies affiliated with TV stations, which do not need to pay for airtime advertising, have grabbed market shares from thousands of private TV home shopping companies, which buy airtime from TV channels to broadcast their infomercials.

Acorn International, a Shanghai-based private company listed in Nasdaq, which sells proprietary and third-party products such as mobile phones and electronic devices via infomercials on 51 channels, has lowered its financial outlook for 2009, partly due to its Yukang Uking mobile series’ underperformance and high marketing costs.

“We expect to achieve net revenues in the range of $280 million to $290 million this year, down from a previous forecast of between $310 million to $350 million,” said Hu Yujun, chairman and CEO of Acorn International, in the financial report for Q3 2009.

China Seven Star Shopping, a private TV home shopping company listed in Hong Kong, also reported a loss of HK$1.6 billion ($206 million) in 2008, due to increasing cost of buying advertising airtime and logistics.

Cao, with Analysys International, said private TV home shopping companies like Acorn International’s major business model is to create new brands and products, and market and distribute them through their channels, while State-owned companies mainly sell already popular brands and products.

“Private TV home shopping companies usually buy airtime from various TV channels, so they have a larger coverage area than State-owned ones which are locally based, but are less credible due to the lack of supervision,” said Cao.

The State Administration of Radio Film and Television (SARFT) has banned 3,600 “illegal” TV ads and infomercials this year, for products including medical products, drugs and cosmetics, said Ren Qian, a senior official in SARFT, at a seminar in Chongqing earlier this month.

Oversight needed

But though China’s TV home shopping industry has a strong potential, analysts caution that it suffers from a lack of standards and oversight.

It realized a sales revenue of 10.57 billion yuan ($1.5 billion) in 2008, a 51.2 percent increase year-on-year, but that figure just accounted for 0.8 percent of the country’s general retail sales, according to Analysys International’s research report.

“The TV home shopping industry has been always blamed for its lack of credibility and that hinders its development,” said Fang Yingzhi, an analyst at China e-Business Research Center.

Cao said the TV home shopping industry needs both self-regulation and government supervision.

“Some TV home shopping companies buy airtime from TV channels and broadcast exaggerated infomercials to attract consumers for short-term profits, and some TV channels do not supervise the contents well in order to increase their advertising revenues. So consumers are easily deceived by frauds.”

Acorn International is an apparent exception, however. It established a 2 million yuan ($292,800) compensation fund with the Beijing Consumers’ Association on April 23, the first one in the TV home shopping industry.

Consumers who purchase products through Acorn International can seek refunds if product disputes arise that cannot be resolved through the operators.

New regulations

SARFT released new regulations in December, saying exclusive TV home shopping channels must have a registered capital of no less than 30 million yuan ($4.39 million), and TV home shopping companies must have a minimum registered capital of 10 million yuan ($1.46 million).

It also said TV broadcasters without exclusive shopping channels may air up to five consecutive hours of TV shopping programs daily, except between 7 pm and 9 pm.

Under the new regulations, channels without SARFT approval will be barred from airing shopping programs beginning January 10, 2010.

“With SARFT’s regulation promoting a healthier TV home shopping industry, we remain confident in the prospects of our business to continue to grow with the industry,” said Hu from Acorn International.

Fang said the SARFT rules also mean small home shopping companies will fade from the airways.

“With the new regulation, venture capital investors will be cautious about investing in small-sized TV shopping companies, these companies will struggle to get financing,” Fang said.

One such company was Shanghai Guxi Home Shopping, a private company with registered capital of 2 million yuan ($292,800), which went bankrupt on November 27.

“The company has no way to keep its business going any longer due to large losses in the global financial crisis,” it said in an announcement on December 3.

Shanghai Guxi had broadcast infomercials on more than 30 channels for the past three years, but was in the red up by about 100 million yuan ($14.64 million).

Internet services in Xinjiang Uygur autonomous region will resume from Monday following five months of closure after the riots.

However, residents in Xinjiang are only allowed to visit xinhuanet.com and people.com.cn from today. Other internet services, international long distance calls and text message will resume gradually in near future, according to the website of the Xinjiang administration.

The websites and mobile phone services were shut down as a result of the Xinjiang”7.5″ riots which started on July 5 and led to hundreds of deaths.

China has put more than 4.65 million computers in over 81,000 Internet cafes across the country under watch to crack down on illegal online games, according to Minister of Culture Cai Wu.

In an interview with Xinhua, Cai said the ministry has closed 219 illegal Internet games with lewd, pornographic and violent contents, and has blocked the access to illegal games and relevant websites for more than 87 million times since the beginning of this year.

China launched a series of nationwide campaigns to crack down on the spread of lewd and pornographic contents through the Internet and mobile phones in 2009.

In the latest development, the Ministry of Public Security said on Thursday that the ministry has closed down more than 2,300 WAP websites accessible by mobile phones, and arrested 34 people for running those websites.

Cai said the culture ministry would set up laws and regulations on Internet games in order to strengthen administration in the sector, and would improve censorship of the games in the future.

At least five people have been detained for dumping large amounts of toxic chemical waste in east China’s Anhui Province, causing water and soil pollution in two counties, said investigators Thursday.

A spokesman with the Bozhou Bureau of Environmental Protection said no deaths or illness had been reported in connection with the pollution.

The bureau launched the investigation after local people reported the pollution earlier this month, he said.

“The waste contained in more than 1,000 barrels was dumped in roadside ditches and a pool. Some of the waste has spilled. Its toxic ingredients are ethylene dichloride, methanol, methane and nitrobenzol, which damage the central nervous system,” said the spokesman.

The bureau had mobilized 1,000 people to collect the 395 tonnes of waste and polluted soil in Woyang and Lixin counties, he said.

A detained garbage dealer surnamed Yang, from Ruji Town of Xinli County said he contracted to dispose of the waste by a local man surnamed Ren in the county. Ren told him that the waste came from a pharmaceutical plant in Dongyang City in Zhejiang Province.

Yang hired four local men to dump the waste.

The Ministry of Environmental Protection was involved in the investigation, said the spokesman.

The Bozhou environmental protection bureau asked the plant in Zhejiang to pay compensation for the environmental damage.

Environment workers found a 10-km section of the Fuwo River running through Xinli County has been polluted by the waste.

Russia will hold its first nationwide Victory Day parade next year, with simultaneous events in 17 cities, to mark the 65th anniversary of Nazi Germany’s defeat during World War II.

“Such a large-scale event will be held in Russia for the first time. At 10:00 a.m. Moscow time on May 9, 2010, the nationwide Victory Day parade will simultaneously take place in all hero cities and cities with military bases,” the Russian President’s Property Manager, Vladimir Kozhin, told reporters here on Tuesday.

“Russian President Dmitry Medvedev will not send personal invitations this time, but we will welcome everyone. The V-Day is a universal holiday,” he added.

Following the parade, a presidential reception would be hosted at the Kremlin, with the participation of World War II veterans and foreign heads of state and government, said Kozhin,

On the Ivanovskaya Square in the Kremlin, a tent camp with mobile army kitchens and armaments will be set up for the reception, according to the Interfax news agency.

Kozhin said there would also be a star-studded concert and fireworks.

Major events celebrating Nazi Germany’s defeat would start on May 8 next year, when a new war memorial would be unveiled in the park near the Kremlin wall, the senior Kremlin official said. It was possible leaders from post-Soviet nations would attend.

Victory Day is an important national holiday for Russia, which lost more than 27 million people during World War II.

China is calling for a joint effort by the government, copyright industry and private enterprises to fight media piracy.

Government officials, NGO representatives, Internet operators and experts from both China and the U.S. attended a forum on Sino-U.S. Internet copyright protection Friday in Beijing, raising possible measures regarding the healthy development of the Internet.

Last month, Chinese authors took search engine Google to court after their works were scanned into its digital library without permission.

Maureen B. Collins, an assistant professor at the John Marshall Law School, said the biggest problem with Google and its efforts to digitalize books was that it ignored copyright laws and regulations.

Both China and the U.S. held an attitude of cooperation and signed a memorandum of understanding on copyright last year, said Ke Heng, a senior consultant from the Jones Day Beijing Representative Office.

Kou Xiaowei, deputy director of the science and digital publishing division at the State Copyright Administration, suggested enacting a regulation on the legal use of digital copyright, aside from the current Copyright Law and Regulations for the Protection of the Right of Communication through Information Network.

Zhang Hongbo, deputy director-general of China Written Works Copyright Society, said, “The current regulations can’t meet the development of modern information technol-ogy and the copyright industry.”

A new platform for online copyright trading was urged.

It is necessary to establish a digital copyright trading platform to contain information about copyright owners, authentication and trade negotiations, Kou said.

“We used to set up copyright agents, but it turned out not as good as we thought,” Kou said. “I think we can mobilize social forces to develop a suitable business model.”

Friday’s forum was one of an increasing number of conferences and forums about on-line copyright held in China.

Wang Yefei, deputy director-general of the National Copyright Administration, said earlier that the government is keen on holding conferences on copyrights, not because the situation in China is more serious, but because solving the problem has hit many roadblocks.

More than 300 illegal websites have been shut down since August, said Wang Ziqiang, an official with the National Copyright Administration.

The rising Chinese middle class, currently ranging between 100 million and 200 million in number, has offered great opportunities for Western companies to sell their goods and services, said a seasoned U.S.-China business expert in Chicago.

In a recent interview with Xinhua, Phil Corse, the Kellogg Adjunct Professor of Global Marketing at Northwestern University, said: “To put it into perspective, the number of China’s emerging middle class is equal or even greater than the entire population of Japan. They are moving up very quickly to buy more home appliances, cars, computers, luxury goods, etc.”

Corse has a classical, disciplined and analytical marketing background and has worked for several companies in consumer products and durables business. He has been working with China forover 15 years and travels to China 3-4 times a year.

According to Corse, China is no longer simply a low-cost manufacturing base for international companies as most people assume, and the burgeoning middle class in China is creating enormous market opportunities for Western companies.

It signifies a large and still growing market of those with enough disposable income and strong purchasing power, he noted.

“We have done the first part of manufacturing in China very well, but the second part of selling to this market is much more difficult,” he said.

Corse pointed out that compared with the U.S. middle class, China’s emerging middle class is much younger. “They are between 25-44 years old. And about 80 percent of them live in the 9 major coastal cities in China, which makes it a little easier to target,” he said.

When analyzing Chinese consumers’ characteristics, Corse thinks that they are very pragmatic and inspirational. “They are savers but also spenders looking for products that they can identify with and express themselves with,” he observed.

Talking about the effective ways to reach the middle class, Corse suggested to start with Chinese social networks, mobile marketing and local advertising.

Looking into 2010, Corse believes that the increasing trend is that the U.S. economy is transferring from a consumption economy to a stimulus economy. “We have no choices but to look at other places in the world. My No. 1 place is of course China. India is not quite ready yet,” he added.

Having been doing business with China over the last 15 years, Corse is constantly impressed by the tremendous support he received from the Chinese government, both at central and local level. “In China, we as foreigners are looking at the Chinese government as partners. But in the U.S. we look at the government as barriers because they are not as supportive as Chinese government when it comes to help small and medium businesses,” Corse said.

Corse predicts that the Chinese economy will grow at a speed of more than 8 percent in 2010. “The Chinese government has put their money back into rebate for Chinese consumers and loans for businesses which will certainly help the economic growth,” he stated.

Commenting on U.S.-China trade relations, Corse said: “U.S. and China relations are going to be very good in 2010. China is our banker and I hope our government understands the extent to which we owe China.”

Finally, Corse recommended that any business people who are interested in exploring China market should visit the Shanghai Expo in 2010, which is going to be the largest event in the planet with millions of visitors from all over the world.

Television stations won’t be allowed to broadcast shopping programs for more than five hours a day on non-shopping channels, starting January 10, the State Administration of Radio Film and Television (SARFT) announced.

The effort is to crack down on deceptive and fraudulent television advertisements.

A notice by the administration says certified TV operators can start operating a shopping channel from their existing ones, or broadcast shopping programs for less than five hours in non-prime time.

Shopping channels that are broadcast nationwide should have at least 100 million yuan ($14 million) in capital, and those that are broadcast only within a single province should have at least 50 million yuan ($7.3 million) in capital.

Miao Di, a professor at the Communication University of China, told the Global Times that the new regulation is aimed at curbing rampant fraud in TV shopping programs seen in the past two years.

Taiwanese host Hou Xingzu had ignited a controversy by selling diamonds that he said were worth almost 1,000 yuan ($146), but some Internet users claimed the diamonds were only worth a few yuan.

313tz.net, an online complaint site run by the China Electronic Chamber of Commerce, received 637 complaints related to TV shopping in October, three times more than the same time last year.

“The rise is associated with the new regulation; as the deadline approaches, some operators take a risk to rake in more money,” the website said.

The website said the products, mainly ranging from 500 ($73) to 1,000 yuan, have deceived consumers as being alleged “high-end products with a low price,” such as a 799- yuan ($117) laptop or mobile phone offering free calls.

The notice also asked infomercials to sell only genuine products and avoid fake and exaggerated promotions.

A label of “shopping” should also be on the screen during the broadcast of infomercials.

Many broadcasters are running shopping channels without permission.

At present, only 10 were approved by SARFT among more than 100 TV shopping agencies, according to China Business News.

“I doubt the new rules will help television stations rather than hinder them because they only eye short-term gains and ignore long-term development,” Miao said.

Many infomercial companies reported deficits, and some even went bankrupt after SARFT began regulating the market in September.

Shanghai-based Jiefang Daily reported earlier that a TV shopping channel named Guxi went broken because of the regulation, and the company owed suppliers ranging from 50,000 yuan ($7,321) to 5 million yuan ($732,176).