China introduces more free-market principles to the telecom industry

The Chinese government has given the country’s state-run telcos more room to determine their own pricing for mobile phones and services, as it looks to introduce more free-market principles in the industry.  Prices now can be set by market forces as long as these are deemed legal and fair to customers, said China’s Ministry of Industry and IT and the National Development and Reform Commission in a joint statement, reported Wall Street Journal. 

China will give its state-controlled telecommunications giants greater freedom to set their own prices for phone, mobile and other services, in its latest effort to bring more market principles to its stodgy government-run companies. Pricing would be allowed to be determined by market forces as long as it is legal and fair to customers, the Ministry of Industry and Information Technology and the National Development and Reform Commission, the state planning agency, said in a joint statement Friday. The notice, which said the new policy will take effect Saturday, also said telecom companies couldn’t give excessive discounts or put out misleading advertisements, suggesting pricing would still come under some form of regulatory review.