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COMMUNICATIONS DAY

28 AUGUST 2013 What's happening today in telecom business, policy & technology ISSUE 4512

Telstra China CEO quits, Autohome IPO on hold

Telstra's China strategy has taken a further blow after the company admitted that its China chief execu- tive Chen Xiaowei had departed recently for "personal reasons."
Hired by former Telstra International chief Tarek Robbiati, the glamorous former CCTV newsreader and McKinsey associate began causing ructions at the company almost immediately after she was hired in early 2011 with staff turnover rising shortly afterwards due to what former employees have described as
an aggressive management style.
"She appeared to be using the job largely to raise her own personal profile," one former employee said, a comment backed up by others who had worked under Chen.

"Chen Xiaowei decided to leave Telstra this year due to personal reasons," a Tel- stra spokesman Scott Whiffin said in an emailed response. It is understood that Ms Chen will not be replaced - although Telstra would not comment on this.
Chen's departure adds to Telstra's problems in China after it was this week drawn into the crackdown on high profile internet commentators when Charles Xue, a key investor in its successful 66 per cent owned Chinese internet site Autohome, was detained on allegations of soliciting a prostitute.
Telstra may add to its own woes, as well, with a decision not to proceed with a planned float of Autohome contrary to the wishes of its early stage investors. These include Xue, Lan Jiang who founded IT168.com, Chinese venture group Orchard Asia and founder Li Xiang, who is the technology brains of the company and has remained with the group.
"We always look at how we can maximise the value of our investments but our current intention is to hold on to our investment in this asset which is one of the leading auto verticals in the Chinese market," Whiffin said. Autohome's other inves- tors are keen to cash in on current strong valuations for Chinese internet companies
and realise their gains to invest in other start up projects, people familiar with the company said.
Autohome's USA listed competitor BitAuto's share price has almost risen from US$3.50 to US$15 over last 10 months.
Xue was detained by police in Beijing at the weekend on suspicion of soliciting a prostitute, the Chi- nese press morning that his wife has disputed the allegations. An American citizen born in China, it is likely he will be sent for "re-education" and then deported.
Political Science professor Professor Hong Dao told reporters in Beijing that if the act of prostitution does not involve a criminal offense, it would be processed by Public Security Administration Punishment Law and he could be sentenced to 10 days detention within 15 days, with a possible fine.
In accordance with the provisions of Beijing law, all prostitution offenders would be sentenced to re- education for six months.
"This approach is the same for Chinese and foreigners, given that he is a foreigner, it is possible for him to get re-education and then be deported." Professor Hong said.

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