Shanghai Daily reports:

According to an insider at the Cultural Marketing Department of China’s Ministry of Culture, licenses for netcafes will not be opened and any information about their opening is part of erroneous rumors.

it was reported in the last day that licenses would be opened for new netcafes throughout China. At present, the approval procedure will still be implemented in accordance with the “Notice on Further Enhance the Management of Internet Cafes and Online Games”, which was jointly launched by 14 administrations at the beginning of last year.

Yesterday’s news was based on “media reports” and today’s news comes from an “insider”. Last year’s ban was promulgated by China’s General Administration for Industry and Commerce (GAIC).

From the article, it would seem that the Ministry of Culture is the regulatory body:

The Ministry of Culture’s focus for the last year was on preventing minors from entering netcafes. Considering the supply and demand of the market, the Ministry decided not to increase the total number of internet bars in 2007 and ordered local governments not to approve new internet bars. The Ministry will announce the total quota and arrangement of netafes annually and it has not decided whether to open license applications in 2008.

It’s unclear if regulation and enforcement are handled by different organizations. Score one for opacity.

The article does have some interesting numbers on the cost of licensing an internet cafe and the revenue:

License applications for netcafes has been stopped for a year, which makes the price of netcafes increase greatly. Many years ago, applying for a license needed less than RMB500. However, the price of netcafes has reached more than RMB1 million in some places, such as Shanghai, Guangdong, Anhui and Shanxi.

According to a survey by Beijing University of Posts and Telecommunications, by last year, there are more than 1,400 netcafes in Beijing. The average annual income of those bars was more than RMB1 million, and bars with 300 computers can earn more than RMB4 million each year.

This would seem to imply that internet cafe licenses are transferable. The cafes would also appear to be a nice little earner.

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