| BUSINESSWEEK ONLINE : JUNE 14, 1999 ISSUE | ||||||||
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| INTERNATIONAL -- ASIAN COVER STORY
'We Didn't Think We Would Become So Famous' (int'l edition) Chen Zhui, 36, and brother Chen Yan, 30, are two small-scale Chinese entrepreneurs who have helped launch a major revolution in China's telecommunications industry. The Chens started an Internet telephony service in 1997, serving customers in southeastern Fujian province. The Chens soon became embroiled in a legal battle with giant China Telecom and the local police, who detained them, fined them, confiscated their computer, and ordered them to stop providing the low-cost service. Having won a court victory in January, the Chens are still waiting for a lower court to decide whether they can get back their equipment and money. The Chens recently spoke to Asia Correspondent Bruce Einhorn from Chen Yan's electronics store, a tiny, open-air shop in the village of Tingjiang, an hour's drive from the provincial capital of Fuzhou. Here are edited excerpts of their conversation: Q: How did you get the idea of providing phone service over the Internet? Chen Zhui: My wife was in the U.S. I found Net2Phone and called her. The results were not so good -- but it was fun. And it was cheap -- 10 cents a minute compared to $2.20 with China Telecom. Q: Soon you started offering free five-minute calls to customers who made purchases in Chen Yan's electronics shop. What made you decide to expand into a regular telecoms service? Chen Zhui: People thought five minutes was too short. They were demanding to talk longer -- and without buying anything first. [Once we started charging], people would say why is it so cheap? Do I have to pay outside [China] too? Q: But didn't you know that you weren't allowed to offer that kind of service? Chen Zhui: I did a lot of research to see if it was regulated. In all the regulations, there was no regulation in this area. There was nothing that said it couldn't be done. Q: The government disagrees. Did you try to get official permission from the bureaucracy? Chen Zhui: I went to the local telecoms bureau [of the Information Industry Ministry]. They said it wasn't their responsibility. Then I went to the local commercial bureau. They said it was the telecoms bureau's responsibility. I didn't know who was responsible. So I started. I never thought it would be the Public Security Bureau that would come and say it was responsible. Q: After the police detained you both, you decided to sue. Why? Isn't it dangerous in China to challenge the government? Chen Zhui: I didn't commit a crime. I wasn't afraid. [The state of] human rights in our country, compared to years ago, is much better. Q: Have you suffered any retribution from the Public Security Bureau? Chen Yan: [They may say] if you sue me, then I'll watch you. If there is a small problem [with your store], then I'll get you. That's what I fear. But there have been no problems yet. Q: Why has your case gotten so much publicity in China? Chen Zhui: Originally, it was a small thing. Then everyone pays attention. We didn't think we would become so famous. But there are many people who are not satisfied with China Telecom. People want the Internet to develop faster and be more open. But China Telecom fears the challenge from information technology. Foreign companies build the Internet's development, not try to control it. But our China Telecom is different. When a new technology develops, China Telecom tries to limit its development so it doesn't affect China Telecom's business. Q: The government is now opening the Internet telephony market on an experimental basis. Do you want to get back into the business? Chen Yan: If we win [our case], we will apply. But it will be very difficult. _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ BACK TO TOP |
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 RELATED ITEMS The Stars of Asia Chen Brothers, Innovators, Internet telephony, China (int'l edition) ONLINE ORIGINAL: ``We Didn't Think We Would Become So Famous'' (int'l edition) INTERACT E-Mail to Business Week Online | |||
