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From next year, China's mobile phone users will have to register for services using their real names, according to the Ministry of Information Industry (MII).

Wang Lijian from MII's News Department said on Sunday that the new rule applies to new post-paid subscribers as well as to an estimated 200 million pre-paid users.

Currently, half of the country's 400 million cell phone users subscribe to pre-paid mobile services provided by China Mobile and China Unicom. Most are not required to register before buying a new phone number.

Experts say that implementing the real-name system could hit China's mobile telecom operators hard in the short term because subscriber numbers will drop and operational costs will go up.

"The operators will suffer a temporary decrease in the number of consumers and short message services (SMS) as people may not like having to provide their ID cards for a phone number," Xu Junqi, vice-dean with the Policy-Making Institute of the Telecommunications Research Center under MII, said yesterday.

"The operators also have to invest a lot in updating their technical facilities and service networks to meet the new requirement."

Telecom value-added service providers are also expected to see their profits drop after the new system takes effect.

But Xu stressed that the new system will benefit both mobile phone users and operators in the long run as it protects consumer interests and reduces operators' management risks.

MII experts in charge of developing the new system said that it includes privacy provisions to protect personal information.

(China Daily October 10, 2006)