National Development and Reform Commission

CCTV rebuts attack over report of monopoly probe

PUBLISHED : Wednesday, 16 November, 2011, 12:00am
UPDATED : Wednesday, 16 November, 2011, 12:00am

The war of words surrounding anti-monopoly investigations into two state-owned telecoms giants has escalated, with China Central Television hitting back at a newspaper report last week that criticised as unfounded and unprofessional its reporting of the probe.

The exchanges reveal acrimony between the National Development and Reform Commission (NDRC) - the central planning agency and a major enforcer of anti-monopoly measures - and the Ministry of Industry and Information Technology, which supervises the telecommunications industry.

Web-based broadcaster China Network Television, CCTV's official website, has been running special reports on the NDRC investigation into accusations that China Telecoms and China Unicom monopolise access to broadband services.

The reports include interviews with industry experts and documents from the two firms, including one marked 'corporate secret', which supported arguments that they abused their dominance.

There is also a section headlined 'Was the NDRC in the wrong?', dedicated to rebutting accusations that the NDRC should not be investigating the firms at this time. Some say the probes are unfair as they have caused the firms' share prices to plunge.

Following CCTV's report last Wednesday that broke the news of the investigations, the People's Posts and Telecommunications News, under the ministry, published an article on Friday defending the two companies. It said, among other criticisms, that CCTV's report lacked evidence and interviewed only NDRC sources.

On the NDRC's side, the People's Daily published a commentary on Friday applauding the probes.

Some mainland experts say the high-profile exchanges are normal because this is the first time that state-owned companies have come under anti-monopoly investigation since the Anti-Monopoly Law came into effect in 2008.

Others have questioned the motive behind the NDRC's decision to first target the telecoms companies, when state-owned companies in other sectors, such as fuel, water and electricity supply, appear to have benefited more from their market dominance.

Political and economic analyst Hu Xingdou said CCTV's unusual persistence showed the central government's determination.

He also dismissed speculation that factional interests within the telecoms industry could be driving the investigations - with China Mobile the obvious beneficiary. 'The heads of all these state-owned companies hold important positions in the party,' Hu said. 'For the NDRC to upset any one of them is difficult.'

Professor Sheng Jiemin , an expert on the anti-monopoly law, said the NDRC had previously approached the two telecoms companies, but they had shown no willingness to change, which was perhaps why it chose such a high-profile method to push the matter forward.

'On the one hand it shows the NDRC's determination to keep the state-owned companies in line, but it has also resulted in public discussions that will be good for promoting an anti-monopoly culture and strengthen the foundation for future action,' Sheng said.