Justine Lau wrote the China 'to block VoIP calls for two years' Financial Times story. I'd like confirmation from a government source and from the four big Chinese telcos. Skype has already twisted the product comply with strange requests (IM censorship, five minute limits on voice calls). Is this an administrative choice or is it just a gambit in international trade talks?

The fallout according to Skype Journal:

1. The two year ban won't survive consumer pressure.
2. If it does, QQ wins. The ban buys a two year window to consolidate their lead and become irreversibly dominant. Already 3-4 times more people use QQ IM than Skype. Unlike Skype's userbase, they all read and write Chinese.
3. More pressure on US and Indian Skype staff and partners.
4. eBay was hoping for a boost from Skype's growth in China. Maybe less so.
5. Fearmongers thrive. Companies that monitor, filter or otherwise block Skype will get a small kick out of this; bigger if they have contracts with Chinese authorities. Check out how Verso (NASDAQ:VRSO) and SurfControl (LSS:SRF.L) stock prices perform.

The first part of Lau's article:

China will not allow paid-for calls between computers and conventional telephones for at least two years, according to the head of Tom Online, the Chinese internet portal which has a joint venture with Skype, the internet telephony company.

In the clearest indication so far of when charged telephone services based on the "voice over internet protocol" system will be launched in China, Wang Leilei, Tom Online's chief executive said the government "is not going to issue VoIP licences until 2008".

The news will be a disappointment to Skype, which told the Financial Times in November that it was in talks with Chinese telecoms operators which it hoped would clear the way for the launch of its computer-to-telephone service, dubbed SkypeOut.

Chinese fixed-line operators are concerned that SkypeOut, which allows users to make calls from computers via the internet to fixed-line or mobile telephones at lower rates, could undermine their core business.

Skype currently offers a free computer-to-computer telephony service to its 9m users in China, although calls are limited to five minutes. It also launched a free computer-to-telephone service about a month ago, which has signed up 10,000 users a day.

Mr Wang said that Tom Online, which claims to have more than 70m users, was not disappointed that it could not launch SkypeOut commercially.

"For Tom Online, our strategy is to grow our user base. With a big user base, there is a lot you can do. Revenue [from SkypeOut] is not important to us because we have not put in a lot of cost," said Mr Wang.

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