Like airlines, the place of telecommunications services among China's strategic sectors is a rather curious development and one that previous generations of PRC leaders would not have foreseen. In the Maoist period, telecommunications held on to the fringes of the command economy and claimed just a tiny fraction of resources from a state investment regime that leaned towards heavy industry development. Today, by contrast, China's highly profitable state-owned telecommunications service enterprises are nothing less than the crown jewels of state capitalism with Chinese characteristics. Why, then, has telecommunications come in from the cold?

Interests and institutions provide only a partial answer to the question. In her comparative work, Roselyn Hsueh (2012, 2011) presents the case that the state has retained a high degree of ownership and control in the telecommunications basic services market because, in contrast to industries such as textiles which the state liberalized and deregulated from early on in the reform process, telecommunications is an industry with high ‘strategic value’ that sits close to core national interests. But, seen against the marked shift over time in the policy status of telecommunications, the salient question is: why does the state now view telecommunications as a strategic sector? And why did it not previously? And while a number of rich empirical analyses have provided a valuable record of the institutional twists and turns that have shaped the status quo in China's telecommunications industry (e.g. Wu 2008; Harwit 2008; Laperrouza 2006), further analysis is needed to address the question of why and how the state's stance towards this industry has shifted so fundamentally.

This chapter draws attention to the role of ideas in shaping policy outcomes. It shows that every major turn in Chinese telecommunications policy over the past half-century has been preceded and shaped by vigorous debate about the role of telecommunications in China's rapidly changing economic and social structures. In these moments of uncertainty, different visions of the possible future of Chinese telecommunications emerged, the merits of which were widely debated among academics, officials, and occasionally even the wider public. As new institutionalist scholars would expect, such debates were not far removed from questions of material benefit; in a manner similar to the process of the airline policy reversal of the late 1990s, short-term winners in the telecommunications industry argued powerfully for the ideas that they perceived to be beneficial to their interests.