China cracks down on mobile phone spam

China's government has punished more than 30 mobile firms that sent spam text messages tricking users into signing up for expensive services, local media reported yesterday, citing sources at China's Ministry of Information Industry.

The firms include leading internet and mobile services company Tencent. Reports did not provide details of the offences or punishments. 

In similar cases in the past, companies have been fined or even barred from offering certain services for a short length of time.

The latest round of punishments is not the first run-in with the law for wireless value added service providers in China.

Last year, the government responded to a growing chorus of user complaints about unfair practices by changing the rules under which third-party providers can sell services over mobile networks.

Many customers said they were charged for mobile information services and downloads to which they had not agreed, or that their attempts to cancel expensive services were ignored.

With the introduction of the new rules, customers must receive clear and repeated warnings when they sign up for a new mobile service. This appears to be one of the rules broken in the latest wave of government sanctions.

Initially users were also mandated a one-month free trial of new services, but this regulation was discontinued after a few months.

Some mobile service providers have been severely hit by the government crackdown. Tom Online's parent company, for example, is attempting to delist it from Hong Kong's stock market after its revenues slumped. 

More broad-based firms have weathered the storm, however. Tencent, which operates China's most popular IM service, reported revenue from mobile and telecoms value-added services of $25.4m in the first quarter, a 20 per cent increase compared to a year earlier.