China Mobile Ordered to Crack Down on Mass SMS Ads

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Beijing has ordered China Mobile to crack down on mass text message spam and the sale of mobile phone numbers to advertisers after a media report showed the long-standing problems have survived efforts to stamp them out.

China Mobile subsidiaries in Shandong province in northeastern China have reaped profits by selling numbers and spamming subscribers with ads, state-run broadcaster CCTV revealed in a consumer rights program on Sunday.

Beijing ordered the company, China's biggest mobile carrier, to investigate the report and punish responsible staff, the Ministry of Industry and Information Technology (MIIT) said in a statement (in Chinese) on its Web site. It also called on China's other mobile carriers, China Telecom and China Unicom, to crack down on spam SMS (short message service) messages, the statement said.

China Mobile is looking into the issue, a spokeswoman said. The company's provincial branches are largely autonomous.

Beijing launched a similar crackdown last year after CCTV exposed rampant SMS spamming by Focus Media, an advertising firm that hammered 200 million mobile phones with unwanted ads, according to the state-run Xinhua news agency.

China had over 640 million mobile subscribers at the end of 2008, according to the MIIT.

Mobile advertising in China's huge market has excited investors, but the mass spamming most effective for advertisers has angered mobile users, said Shaun Rein, director of market intelligence firm China Market Research Group.

"SMS spam advertising has been really big in China, because the fact of the matter is it works," Rein said.

SMS spam, down last year, has risen again as companies desperate for cash turn to selling mobile phone numbers, Rein said.

The MIIT has shut down 14,000 sources of SMS spam and ended severe violations by more than 300 firms since last year, according to its website.

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