Chapter 185 The Royalists and the Reformists
The conference room was filled with smoke, the atmosphere heavy.
Su Yuanshan had already answered several questions, ranging from the development trends of domestic and international technology to the practical realization of mobile internet.
Every question stemmed from his earlier report.
This meant that the officials had not only read his report—they had studied it carefully.
"Xiao Su, just one last question," said Director Tang, who was seated at the head of the table, looking at him intently.
"Please go ahead, Director," Su Yuanshan replied calmly.
"From the perspective of a technology provider," Tang said, "do you think it would be better to advance this through a government administrative approach or through enterprise-based market competition?"
Su Yuanshan licked his dry lips, then smiled.
Of course, he wasn't naive enough to think his opinion alone could sway a ministry's decision.
But the very fact they were asking him now…
showed that it mattered.
From the moment he entered the room, he had been observing carefully.
And he had confirmed what Tian Yaoming had said:
the support for the two camps—the "Royalists" (favoring administrative control) and the "Reformists" (favoring enterprise-driven reform)—was almost evenly split.
A few years ago, when mobile phones first started appearing in China, the Ministry of Posts and Telecommunications had already set up a special Postal Communications Department to manage this new market.
Because of well-known reasons, China had no mobile communications standards during the analog era and simply adopted Britain's TACS (Total Access Communications System).
But problems emerged.
First, the coverage and stability of analog networks were terrible—an inherent flaw—and there was no supporting network infrastructure.
Second, the systems built around Ericsson and Motorola standards were incompatible and couldn't roam between each other.
For instance:
If City A's Postal Bureau chose Ericsson's equipment, then only Ericsson phones would work there. Motorola handsets couldn't connect.
Third, because the networks lacked systematic support, real-time billing wasn't possible.
Roaming settlements were handled by exchanging magnetic tapes—a painfully slow and error-prone process.
If a user from City A wanted to travel to City B, he had to apply at City A's postal office ahead of time, requesting roaming services.
City A's office would then call City B's office and request a temporary number for the user.
When the user arrived in City B, he had to manually switch to the temporary number to make or receive calls.
Ridiculously cumbersome.
And roaming wasn't cheap—fees could be outrageous, and settlements often took three months.
In Su Yuanshan's previous life, the creation of a Mobile Communications Bureau was meant to solve these exact headaches.
Eventually, after trialing GSM in Guangdong Province, they expanded it to thirteen provinces in under a year.
Of course, analog network users weren't simply abandoned.
The Postal Bureau worked with Ericsson and Motorola to unify signaling protocols, enabling some degree of national roaming.
This led to China creating the world's largest analog network.
...
And then it was swiftly phased out.
However, thanks to Yuanxin's emergence, the Ministry of Posts and Telecommunications was thinking a step further this time:
How to simultaneously solve the old problems and rapidly promote the next-generation digital network.
Thus, two paths emerged:
Establish a Mobile Communications Bureau: focus on fixing the old problems.Establish a Mobile Communications Company: focus on promoting new technology.
Why not both?
Because a mobile communications company would typically be a vice-ministerial entity.
It would outrank or at least match the Mobile Communications Bureau.
You can imagine the chaos:
One side trying to protect the old system, the other trying to innovate.
Who would the government listen to?
...
Su Yuanshan didn't hesitate long.
Just one sip of water—and he knew exactly what to say.
Being vague and trying to please both sides was what a timid business would do.
But as a tech infrastructure company, Yuanxin had to stand firmly on the side of progress.
Since the officials clearly wanted Yuanxin's "third-party perspective" to help break the stalemate...
He would simply speak from the heart.
"Leaders," Su Yuanshan said, sitting up straighter,
"As a private enterprise, Yuanxin would naturally prefer to cooperate with enterprises."
"In fact, I believe...
as long as we rapidly roll out the GSM digital network,
the problems plaguing the analog system will resolve themselves."
One of the leaders, snuffing out his cigarette, looked at him and said,
"But we can't just abandon our current analog users."
"Of course not," Su Yuanshan smiled.
"We transition them."
"The Postal Bureau could offer subsidies for users switching networks, based on factors like tenure and spending level.
Meanwhile, Yuanxin could offer trade-in promotions for mobile phones."
The leader looked intrigued. "Trade-in promotions?"
"Yes," Su Yuanshan nodded.
"Users with older phones can exchange them for discounts on new GSM phones.
We'll absorb part of the cost to incentivize the switch."
"And what happens to the old analog phones?" the leader asked.
"Sell them as scrap," Su Yuanshan answered bluntly.
The room: "..."
Su Yuanshan chuckled and continued,
"As for the analog base stations, during the dual-network period, we maintain basic services without investing in upgrades."
He paused briefly, then pushed forward.
"Frankly, the cost of fixing all the old analog problems...
is comparable to the cost of subsidizing users to migrate to GSM."
He glanced meaningfully at the officials leaning toward patching the old network.
"Leaders," he said softly,
"let's think about it from the future's perspective."
"When we look back fifteen years from now, after entering the 3G and even 4G era,
what decision will we wish we had made today?"
The room fell silent.
Many officials suddenly had a glint in their eyes—the kind that comes from being deeply moved.
Director Tang looked steadily at Su Yuanshan, then slowly nodded.
He cleared his throat and said to his colleagues,
"I understand Mr. Su's point."
"Analog networks are destined to be phased out."
"The question is whether we phase them out proactively—or passively let them die."
"Active phase-out means shedding burdens.
Passive phase-out means dragging them along."
Su Yuanshan clapped and said warmly,
"Director, you summed it up perfectly!"
Tang smiled.
"Then let's shed the burdens and travel light."
Those who had been advocating to maintain the old networks looked dejected.
They knew better than anyone the blood, sweat, and tears that had gone into building the analog system.
It hadn't been easy.
In 1987, Guangdong Province, riding the wave of the reform movement, wanted mobile phone service in time for the Sixth National Games.
After choosing the TACS standard and striking a deal with Ericsson, they had begged Beijing for funding.
Beijing's answer:
"No money. But you can have whatever policies you want."
So the Guangdong Postal Bureau scraped together $5 million in interest-free loans from CSL (Hong Kong Mobile Communications Limited) and pieced together the rest from various banks.
What followed were years of hardship and toil.
From nothing, they had built the world's largest analog network.
And now, in just six short years...
it had become a burden.
That night, Su Yuanshan couldn't sleep.
Too excited.
He sat on the sofa, chatting with Deputy Director Min Guangliang from the Ministry's Department of Science and Technology.
Min was also an alumnus of Dian University and had been one of the officials who first engaged with Yuanxin.
"Honestly," Su Yuanshan said, smiling slyly,
"among all government departments, I think the Ministry of Posts and Telecommunications has the strongest entrepreneurial spirit."
Min chuckled. "Why do you say that?"
"Just a feeling," Su Yuanshan winked.
In truth, it wasn't just a feeling.
He knew from history that the Postal Ministry was constantly reinventing itself—splitting into Telecom and Mobile, merging again, restructuring again.
These were people who got things done.
"Haha, you're not wrong," Min said.
"From top to bottom, we're always pushing forward."
"And now it looks like founding a Mobile Communications Company is inevitable," Min added.
"As a supplier, what support can Yuanxin offer?"
Su Yuanshan narrowed his eyes and teased,
"Uncle Min, sounds like you're about to get a promotion."
Min blinked, surprised by Su Yuanshan's political acumen.
Trying to stay modest, he said,
"Just moving to a new post. Still handling technical work."
"Chief Technology Officer of the Mobile Company—at bureau level," Su Yuanshan said with a knowing smile.
Then, he turned serious.
"Uncle Min, honestly, our support will depend on your company's specific needs.
But rest assured—Yuanxin won't be like Ericsson, charging $6 million for a junky analog base station and refusing to budge a penny."
Min let out a long breath of relief.
Funding was always the biggest bottleneck in building a mobile network.
He smiled wryly and said,
"Actually, Ericsson and Motorola have already approached us multiple times—offering base stations at shockingly low prices."
Su Yuanshan understood the implication.
In the past, Ericsson had dared to charge outrageous prices because of technical monopolies.
Now, facing competition, they were scrambling to slash prices.
But in technical fields like base stations,
as long as Yuanxin didn't cut corners,
no foreign company could beat them on value.
"Uncle Min," Su Yuanshan said with a yawn,
"maybe not even twenty years from now...
we'll be selling equipment to them instead."
Min chuckled and nodded.
"Then we'll be exporting base stations to the world."
Su Yuanshan smiled and finally nodded too.
"Exactly."
...
The Ministry's response came quickly.
Within three days of the decision,
the preliminary leadership structure for the new mobile communications company was finalized.
Just as Su Yuanshan expected, it was a high-profile, vice-ministerial enterprise, led by a Vice Minister himself, with Min Guangliang as Chief Technology Officer.
It showed the Ministry's determination to move boldly.
And with that, Yuanxin had to step up too.
Su Yuanshan summoned Wang Rui, head of Yuanxin's Mobile Division, to Beijing to work with Tian Yaoming—one would handle industrial cooperation, the other technical collaboration.
As for Su Yuanshan,
he returned to the provincial capital the next day.
His first stop back at the Science Park:
Qin Weimin's office.
Qin, seeing how exhausted he looked, smiled and pulled a CD case from his bag.
"I thought it wasn't a big deal.
But you made me so nervous,
I felt like a spy smuggling secret documents."
It was the CPU data and engineering files from Claude's side—
everything Xinghai and Cyrix had achieved so far in CPU development.
To avoid any accidents, they had smuggled it back early.
"Better safe than sorry," Su Yuanshan said with a grin.
"Next time, just have a diplomat carry it back through a diplomatic pouch," Qin Weimin joked.
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