I have been using a Huawei E5830 mobile broadband router in Shanghai.

It allows me to create a personal 3G wireless hotspot. In other words my 3G China Unicom data signal can be shared between upto five devices such as my Nexus One phone and netbook.

The mifi device is smaller than a cellphone and fits neatly into a pocket or bag. It has a rechargeable lithium ion battery that gives about 5 hours of use. It was manufactured by Huawei, but the model I bought was rebadged as ‘Mifi’ by the UK mobile network operator Three. They have locked down the firmware so you can only use it with their simcard and tariff. I got round this problem by buying it from a UK Ebay seller who had unlocked the mifi by flashing it with new firmware. I paid 68.50 GBP for my mifi whereas Expansys HK are selling unlocked devices for over double the price.

My unlocked mifi allows my wifi devices to go online using any wcdma 3G sim and I can configure it using a browser in the same way as any other wireless router by entering 192.168.1.1 in the address bar. This means you can configure the device using any device with a browser. I have got the mifi to work using Ubuntu Netbook Remix and Jolicloud, although I had some difficulty getting Ubuntu to connect in the first instance.

You can make the mifi secure by setting WEP or WPA passwords and choosing whether or not to broadcast the SSID (the wifi access point name). The device still has a built in client, which works better with XP than Windows 7.

My wifi seems to work fine at getting online especially downtown, but it feels more temperamental in the Pudong hinterland. I have been able to use it to stream and download podcasts even video. The problems start when I try to connect to my VPN using PPTP. My first hurdle was changing the DNS address to Opendns or Google’s servers. The Netvigator firmware on the device forces you to use the mobile ISP’s DNS address. You can only get online with a VPN if you change the DNS server address. Otherwise, the GFW engages in the nasty practice of DNS poisoning, which is a bit like tearing up your address book so there is no way of knowing which numbers to dial.

There is a work around. You need to setup a dmz to a static ip address, which uses a different DNS server to the mifi device. Then my Nexus One connects fine, but my phone has a bug so it cannot sustain a PPTP VPN connection. In layman’s terms this means I can use my Nexus One’s wifi connection to talk to my mifi to momentarily pretend to be in the UK or US. I have a few minutes grace to bypass the bamboo firewall through to Facebook and Twitter before my Nexus One craps out and comes back to China. Maybe it is wrong to blame the mifi for this problem, but it will not let me connect to my VPN from my netbook.

I had more success sustaining a VPN connection from my Nexus One once I rooted it and installed the Cyanogenmod Rom, which lets me connect to a VPN using the openvpn protocol. Since I have stopped trying to use PPTP my mifi’s Internet connection has felt more reliable. PPTP is known for being fairly easy to detect and block. Am I being paranoid or does China Unicom timeout your 3G connection when they figure out you are using a VPN to get round the GFW?

After a few weeks I would give my mifi a qualified recommendation providing you buy a hacked device from Ebay and travel to locations that get good 3G data reception.

I bought a Nexus One phone last month, but it took me a few weeks to get it shipped from the UK. It cost just under 4000 RMB, but I would buy it from Expansys.com.hk in the future or PDA Dream at Cyber on Huai Hai Road. You can buy a Nexus One in shanghai for 4600 RMB without waiting several weeks.

I could have bought an I phone, but I like linux and wanted to be able to run multi tasking. I have been using my new phone for two weels. This is what I like about it:

• The phone feels great in my hand and is beautifully designed.
• The amoled screen is crisp and at 800 by 480 is good for reading text and watching movies.
• GPS is amazing. I have had fun tracking my location on Google Earth and Google Maps.
• I like the choice of apps from the market place. I have been using Seesmic for Twitter Guardian Anywhere, Gmote to remote control my computer and Listen for podcasts.
• Mobile web browsing looks great.
• The camera is really good for pictures and videos in natural light.
• The syncing of Google contacts, calendar and Gmail is seamless.
• Android is easy to use and easy to customise compared with Windows Mobile.
• Multi touch lets you pinch and zoom when browsing and viewing photographs.
• The noise cancelling microphone makes call quality very high.
• Battery life is very good (all day) if you manage the phone properly by turning off animated (live) wallpapers, dimming the screen brightness, regularly using a task manager to kill background services and turning off gps, wifi, bluetooth and 3g when not needed.

There are a few kinks and issues that need to be figured out for Android to be perfect rather than merely very good.

• Android needs Audible audiobook support. I have to use Macosome Audiobook converter to listen to my Audible collection on my Nexus One.
• You need third party software to sync Itunes with Android. Doubletwist works fine on my Mac, but it cannot handle smart playlists.
• Android does not yet support many video codecs. It supports h264, m4v and mp4, but I had trouble playing the mp4 files I downloaded from BBC Iplayer Downloader only rectified using Handbrake.
• Copy and paste is awkward. It is buried in menus for browsing and is not available in the native gmail app.
• The virtual screen keyboard takes a lot of getting used to after a physical keyboard on the HTC Tytn. I have recently installed Swype, which is much better than the native keyboard.
• Paid apps are only available from the Android marketplace in a few countries (not China). I had to pop in a UK sim card and use a vpn to download paid apps such as Pixelpipe Pro and The Egg talking timer.
• There is vpn support, but you need to root your phone to use openvpn. Chinese isps keep cutting my pptp connection after a few minutes.

These are a few minor gripes amplified by living behind the GFW. I am sure they will be fixed or worked around as Android develops and matures. This is still the best phone I have ever used, although I have never owned an Iphone.

SkypeIn is not available in China, but I will show you how to create a local number for all your contacts using Rebtel's collect call option. This means that my family in the UK can call a local number, which is routed to a Chinese number. This also means that I pay for people to call me from the UK, but it also means that you only get calls from your Rebtel contact list. I'm going to go one step further and route calls from China or the UK to Skype via Google Voice.

There are a few sticking points to getting Google Voice to work in China:

1. You need an invitation to join Google Voice. It is not open to everyone.
2. You need to have an American IP address to setup Google Voice. It is only open to people in the US.
3. You need to use American telephone numbers to link to your Google Voice number.
4. Your contacts need to dial an American telephone to call you on Google Voice.

How do we get beyond these deal breakers? I have summarised the basic workflow rather than providing a granular step by step tutorial. I'm happy to do this at a later stage if there is a need and a wish.

1. Get a Google Voice Inviation
   Google Voice invitations are easier to track down now. Ask for one on Twitter or look around for a site like Inviteshare.com
2. Get a US IP address
   I used a private paid for VPN (StrongVPN.com) to get a US IP address.
3. Get a US phone number, which you link to Google Voice
   I got a free US landline number, which I found by signing up to IPKall.com. I used it to link my SIPPhone account on Gizmo5 to a US landline number. Gizmo5 is an alternative to Skype that lets you make cheap phonecalls from your computer or cellphone using a Java mobile client. Google just bought Gizmo5 so it is no longer available to newcomers, but there maybe SIP alternatives if you get stuck. I used my IPKall US landline number to receive and forward calls via Google Voice.
4. Route locals from a local number to your Google Voice account
   Get a Rebtel account, which allows your contacts to make collect calls to your international phone services using a local number. Each call can be routed to your SIPPhone or IPKall number via Google Voice. It is also possible to forward calls from Gizmo5 to Skype or Google Talk .

This strange hack means I can use a data only China Unicom 3G sim card on a smartphone that runs Skype or a SIPPhone client. A blended voice and data plan is expensive costing 386 RMB for 1.3 GB a month, whereas you pay 200 RMB for 5GB using a data only 3G package over the same period. In effect you are using VOIP via 3G and wifi to replace China Unicom for voice calls. This is great for people like me who like to use their cellphones to access the Internet and run applications rather than making telephone calls. I have not yet got this to work on a Smartphone. I will post an update when I try making data only calls on my new Nexus One, which arrives from the UK next week.

I have got this solution to work quite well using an Ubuntu netbook running Skype through a USB 3G dongle. There is a caveat, however. The convoluted routing of calls caused a slight delay and I had to get Skype to automatically answer when receiving calls via Google Voice. I intend to keep a VPN switched on when using my phone to make VOIP calls. I am sure China Unicom prefers customers to pay for regular and more expensive cellphone minutes given SkypeIn is not permitted in China. I hope China Unicom will not find a way to break my workaround.

Posted via email from catshanghai’s posterous

When the story first broke, I was in a state of excitement and anxiety. Call it dysphoria. On one hand, it was amazing to see my favourite web company stand up for free speech against an arrogant emerging superpower. I was also worried that this Google fanboy would lose access to all the tools that make him feel connected to the world inside and outside China. I feared and still fear losing access to Google search, Gmail, Google Calendar, Picasa and Google Reader. I’ve been telling students to get ready by setting up alternative Email addresses and getting used to the idea of using Bing.com as a second choice search engine.

Since then nothing much has happened except for rash speculation about Google’s real agenda throughout blogs, Twitter, podcasts and news sites about the real reason and impact of Google’s announcement on January 12. Here are a number of theories being tossed about:

• Many employees at Google are unhappy about their decision in 2006 to censor search results when they made and agreement with the Chinese government and setup Google.cn. The free speech Google faction was looking for an excuse to get out of China in order to reconcile their ethical free speech motto of ‘Do No Evil’.
• Sergey Brin was particularly unhappy that the Chinese government or patriotic hackers were trying to use Google’s technology to spy on human rights activists and dissidents given that his family originate from the former Soviet Union.
• Google can not trust the Chinese government as a business partner if they spy on them and try to steal Google’s intellectual property.
• Google were using the hacking attack and free speech issues to leave for business reasons given they only had 30 percent of the search market in China compared with Baidu’s 60 percent.
• The Chinese market accounts for only 2 percent of China’s online revenues, but it is also a source of problems in terms of hackers, click fraud and phishing scams. Leaving the market would help to mitigate these issues.
• Leaving China would give Google a huge PR boost as advocates of Internet freedom.
• Google insiders in their Chinese operation helped Chinese hackers with the attack so they need to close Google.cn to maintain security of their systems and customers’ data.
• The incident revealed an embarrassing security flaw, which could reduce confidence in Google as a secure place for Internet users to keep their online data. Blaming the Chinese would point the blame at others rather than put the spotlight on Google’s security failures.
• China wishes to become a large intranet that excludes access to all international sites that have not been issued with a license to be viewed within the Bamboo firewall. Such a move would fracture the Internet. What is good for the Internet is good for Google. What is bad for the Internet is bad for Google. Leaving China is a hardball negotiating tactic to try and keep the Internet whole and complete.
• Google is using their announcement to initiate a foreign policy response from the US government to protect open standards, free speech and American commercial interests overseas.
• Google is showing that modern corporations can operate as quasi states with more clout than sovereign countries, rather like the Dutch East India Company during the colonial era. Notice how the Chinese government gave a muted response to Google’s announcement. Contrast this with the indignation meted out to the UK government’s criticism of Akmal Shaikh’s recent execution for drug smuggling.

So many theories raise more questions than they answer, but it is useful to bring together a list of sources on this issue even if history finally reveals that some of them have speculated falsely.

Google Defends Against Large Scale Chinese Cyber Attack: May Cease Chinese Operations

Google Official Announcement on January 12

Google’s China Stance: More about Business than Thwarting Evil by Sarah Lacy of Techcrunch (January 12)

What Google Should Do by Jeff Jarvis (author of What Would Google Do) (January 12)

Google Puts Its Foot Down by Rebecca Mackinnon (January 12)

My Response to Jeff Jarvis’ Comments on the Google-China Showdown by Siva Vaidhyanathan (January 12)

The Google News: China Enters The Bush-Cheney Era by James Fallows (January 12)

China Seeks Clarity on China’s Intentions by Miao Xiaojuan, Cheng Zhuo and Wang Cong of Xinhua (January 13)

Google sends a shockwave through Chinese internet by Charles Arthur of The Guardian

How Google censors its results in China by Bobbie Johnson of the Guardian (January 13)

China’s cyberwar goes beyond Google by Tim Stevens of The Guardian (January 13)

Everything (almost) that’s happened with Google + China so far – Elaine Chow of Shanghaiist (January 13)

Google strikes a blow to China’s Great Firewall by Jeremy Goldkorn in The Guardian (January 13)

Google v. Baidu: It’s Not Just about China by Sarah Lacy of Techcrunch (January 13)

Google’s challenge to China: the reaction by Tania Branigan and Dan Chung of the Guardian (January 13)

Google attacks ‘trace back to China’ by Tania Branigan and Kevin Anderson of The Guardian (January 13)

Google counts cost of censorship and draws red line under China by Boobie Johnson of the Guardian (January 13)

Timeline: Chinese internet censorship over the last year by Tania Branigan of The Guardian (January 14)

Google the latest victim of Chinese ‘state-sponsored’ cyberwar by Charles Arthur of The Guardian (January 14)

Google investigates China staff over cyber attack by Tania Branigan of the Guardian (January 18)

Playing the Wall Game in China by Tania Branigan and Charles Arthur of The Guardian (January 18)

Podcast Links

NPR Onpoint Radio Google Versus China – 18th January 2010 with Tom Ashbrook, James Fallows, Kara Swisher, David Barboza and Yong Xue

This Week In Google Podcast Episode 25 ‘The People’s Republic of Google’ with Leo Laporte, Jeff Jarvis, Gina Trapani and Siva Vaidhyanathan (January 19)

BBC Digital Planet – 19th January 2010 with Gareth Mitchell, Bill Murray and Fons Tuinstra

3G is high speed mobile Internet for compatible cellphones or laptops using usb modem. This service is now available in major Chinese cities. You can choose between China Mobile's TD-SCDMA, China Telecom's EVDO and China Unicom's WCDMA.

I bought a wireless USB modem to use with China Unicom's WCDMA 3G service. It cost me 1188 RMB, which included a modem and 600 RMB of prepaid credit. I bought the dongle from the China Unicom shop in Lujiabang Road. I setup a monthly plan, which charged me 150 RMB for 3GB of monthly data. This is fine for casual browsing and occasional media streaming, but it is not suitable for heavy data use.

I use 3G on the bus or taxi travelling to work between downtown Puxi and my workplace 20 kms away in suburban Pudong. I plug the USB dongle into my netbook so I can connect anywhere. There are patches of poor connectivity, but I have had a good experience using 3G to supplement my Internet use. The service advertises download speeds of upto 7.2 mbps, but I have achieved speeds of upto 1 mbps. It is very quick for downloading files, but it sometimes takes a long time to open pages. I have had success streaming Youku and Youtube videos. I even used the 3G service when I was on holiday in Guangzhou. We were able to setup a very smooth video call with my mum in the UK on Christmas day.

The USB dongle has a built in client that runs on Windows or Mac. The software did not always allow to me setup a connection so I had more success using the networking tools built into Windows 7. Ubuntu Karmic was able to see my USB dongle without any problems, although it took a little configuration to make and sustain an Internet connection.

Here are a few things I discovered that have helped my 3G experience:

1. I turn on the CHAP and MS CHAP protocols on Windows and Ubuntu
2. I use Open DNS (208.67.222.222, 208.67.220.220)
3. I use a paid for VPN to access blocked international sites

I am starting to have some hardware problems with the dongle. Sometimes it falls out of the USB slot and it doesn't always show up as a device when the netbook opens up after waking from sleep mode. I would recommend the service to use with a netbook, but it might be worth looking at devices with built in 3G data connectivity rather than buying a separate dongle.

Posted via email from catshanghai’s posterous

A VPN is a way of connecting to a computer remotely. Many sites such as BBC Iplayer, Hulu or Pandora have geographical restrictions that block access from computers outside specific countries. You need to have a UK IP address to access the BBC Iplayer. You can only access this service overseas by setting up a VPN that makes it look like you are in the UK by giving you a UK IP address. Given that the Internet is heavily controlled in China I also need to use a VPN to access blocked sites such as Facebook, Twitter and Youtube.

It is possible to setup a VPN yourself, but making an SSH tunnel connection with an overseas webserver, but this requires technical knowledge and a friend in another country willing to share their connection. I have been trying out paid for solutions with mixed results,which I am still trying to figure out.

I have tried Witopia, which offers remote VPN access to servers in the USA and more recently the UK. It requires a little technical confidence to setup on Windows or Mac and used to work quite well for me until three months ago when the connection slowed to being almost unuseable. I also had a problem when connecting to the UK servers to access BBC Iplayer. The connection would start quickly enough before being throttled into a crawl or even cutting out. The basic service costs $40 a year and the full SSH costs $70.I have read reports from people who love it and others whowith the same complaint as me. They have a very responsive support team who have suggested that I change the DNS settings or the server gateway, but nothing has worked. I am on the verge of ditching Witopia when my subscription comes up for renewal at the end of August.

I was quite excited when I read an interview with a newcomer called Freedur on Shanghaiist. Freedur promises to be easy to install on Mac or Windows to allow unfiltered web access to American servers without worrying what is happening under the hood. The website was a little difficult to follow, because it did not have clear instructions. The service starts at $5.99 a month using Paypal, which I paid after failing to figure out the trial service, but I got Freedur to work on Leopard after playing Email tag with Freedur’s support team. I have been very pleased with Freedur. It has been very quick for streaming music services and Youtube videos in China. I did become very alarmed at the beginning of the week after AVG flagged up the Freedur client as a trojan horse. I changed all my passwords and reinstalled Windows 7 on my new netbook. Freedur told me the AV notification was a case of mistaken identity, which appears to be the case after I scanned the file again today. I have reinstalled Freedur cautiously and have started to use it again.

I have also tried another VPN servce at VPNUK, which offers basic access to a UK Ip address for 6.50 GBP a month. It was quick enough when I first started using it, but it keeps disconnecting at home. The connection is more stable from my local Starbucks, but it is still slow.

I also tried out consult-here.com to access Iplayer earlier in the year, but their website looks so under the radar that I don’t quite trust them.

Freedur is my favourite VPN at the moment, because it offers the most stable and quickest connection. I am aware that it is possible to spend $15 a month or more for a dedicated IP address in another country with no bandwidth limits so the connection should be very reliable if you are willing to spend a little more. I am cautious about spending a lot of money on a VPN solution given that there is no guarantee that something working today will be reliable tomorrow or next week. I may also need to look at replacing my ADSL terminal or wireless router. It is really irritating when my Internet connection stops working altogether after I disconnect from a VPN. Perhaps there is mischievous censor kicking me off the network as punishment for finding ways to access Twitter and Facebook.

A final word of caution is that all traffic goes through the VPN provider. This is a mixed blessing. Using a VPN should make you safer from hackers and eavesdroppers in a coffeeshop, but the VPN can see all your data. You need to trust the VPN provider or be cautious. I never log on to a VPN while accessing my online bank account or entering sensitive passwords.

Related Posts
http://www.catshanghai.com/blog/2009/07/09/no-face-book-2/
http://www.catshanghai.com/blog/2008/12/16/watching-bbc-iplayer-from-china/

Posted via email from catshanghai’s posterous

I’ve been using Vimeo recently. It has a basic free service that lets you upload upto 500 mb of videos each week. All video hosting sites display uploaded footage as compressed flash streams, but Vimeo viewers can download the original file. This is very good for my parents who want to see my baby son Jake reach his milestones in high quality video. It has standard embed and sharing to show the video in this blog and in my Facebook feed. I am a little concerned about the new terms of service from next month that disables the download feature after a week. I could pay $60 for a premium account that enables this feature, but what happens if this site suddenly stops working in China?

Jake Crosses The Bridge from Matt Seigal on Vimeo.

Call it paranoia, but I have been trying out alternative solutions. I have just activated the free two month trial of Apple’s MobileMe. This offers upto 20 GB of online storage, which can be shared with others. It is convenient that it integrates so easily into IMovie, but it took some research and Vaper’s Video tag plugin for WordPress to be able to embed the uploaded Quicktime movies into my blog. I need to remember to add a link to the file if I want my family to download high quality videos of Jake. I’m confident that MobileMe will not be blocked in China, because it is not available to subscribers in this country and it is expensive at $99 a year. I may be tempted to shop on Ebay or Amazon for MobileMe at a discount of upto 50 percent.

I also tried the Indian video hosting site Viddler. Each uploaded video can be upto 500 mb and viewers have a download option that is not yet restricted to paying customers. Videos can be crossposted as an embed into blogs, but this feature does not seem to include Facebook. Perhaps Viddler will be blocked if it catches on as a place to host sensitive footage, but it’s not a household name like Youtube so it may slip through the cracks of a social media crackdown.

Another solution was to use ftp to upload a Quicktime video to my Dreamhost server and to embed the video into my blogpost. This works in a very similar way to embedding MobileMe videos. The advantage is I can move my blog and videos together if my site is ever blocked. The disadvantage is that I am paying for a basic shared hosting plan and performance may be slower than other solutions especially if the files are large. It may be OK, because I only serve videos to a few people.

There are other solutions, but these are hampered by practical issues. I could use Witopia as my virtual private network to hop over the Great Firewall of China to upload footage to Youtube and other blocked services, The problem is that Witopia has been painfully slow in recent weeks and Chinese friends will not be able to see my videos. I could upload videos to Chinese hosting sites like Tudou and Youku, but they are slow outside China and do not offer download options as far as I could see.

What is the best way for someone in China to share videos with the outside world? I’m going to use Viddler, MobileMe and my personal webhost. I hope that no more video sharing services get blocked. If they do then I have a way to share my memories of Jake with my family around the world.

I’m a big fan of Leo Laporte who single handedly created the Twit technology podcast network. His shows keeps me informed and stop me going insane during long commutes home through Shanghai rush hours.

Leo is coming to China at the end of this week to participate in a Geek Cruise where he’ll be giving talks about Iphone apps, social media and setting up a Mac Mini home theatre system. During this week’s episode of MacBreak Weekly Leo and his fellow geek cruisers alluded to the expense of setting up roaming cellphone data plans so they could tweet and blog on the road in China. Apparently, AT&T charge $199 a month for an international plan whereas UK’s O2 want travellers to pay 50 GBP for 50 mb of data.

I have good news for the geek cruising MacBreak Weekly panel whose twitter handles are respectively @leolaporte , @donmcallister and @ihnatko. Cancel your expensive data plans and do the following:

• Unlock your cellphone, which may not be possible yet if you are bringing the latest Iphone 3GS to China with you
• Fly to China
• Buy a China Mobile simcard (100 RMB) and another 100 RMB prepay voucher
• Change the sim card
• Call 10086 to setup a data plan and get instructions on configuring your phone, but the basic gprs settings are ap:cmnet, username:cmnet, password: cmnet.
  Use opendns (208.67.222.222, 208.67.220.220) as your name server, because the Chinese DNS servers are awful.

100 RMB will pay for 2gb of data. 200 RMB will get you 5gb. It is Edge speed, which is quick enough to upload text and photos to blogs. GPRS will give you access even in remote areas, but it is very, very slow. Wifi is quicker and pervasive in coffee shops, hotels and restaurants. Wifi is often free, or you may be able to pay to use it from your Skype account if you are at Starbucks. Don’t expect to access Youtube unless you have access to a proxy, and even then it can be very slow. Twitter, Gmail, Flickr have all been blocked recently although they are working at the moment. Even unblocked international sites are slowed by lag and having to pass through the GFW.

Otherwise, Leo and his mates should enjoy their time in China by eating good food, checking out the historical sites and watching people play Mah Jong and walk backwards in parks.

I have recently discovered how to get online via ChinaNet wireless access points, which you can see in coffeeshops throughout Shanghai.

People living in Shanghai with a China Telecom ADSL account can use this account to login to ChinaNet access points. Here are the steps that you need to follow:

1. Select the ChinaNet wireless access point in your wireless dropdown list.
2. Enter your account username and password.
   Your username is your China Telecom ADSL username with “@shtel.tyt” at the end. If your China Telecom ADSL username is “ad999999999 the access point username is “ad999999999@shtel.tyt”
   Your password is the same as your China Telecom ADSL password. You can see this on the card that was given to you when first setup your Internet access with China Telecom.
3. Enter the verify code, which is the captcha number under the VPN checkbox. In this case it is ’1355′.
4. Now you are online.

I have tried ChinaNet at Starbucks in Liyuan Lu and Huai Hai Lu. Liyuan Lu had fewer customers using wifi so the performance was much better than the busier central location. I was able to achieve download speeds of up to 260kbps, which is comparable with my Internet access at home.

Getting online this way is cheap, but not free. It costs 3.6 RMB each hour of online time, which is added to your monthly China Telecom bill. You also tend to see ChinaNet access points at overpriced coffee outlets such as Starbucks that should really know better and throw in free wifi after spending 30 RMB on a cup of coffee. There are plenty of free wifi hotspots throughout Shanghai. My favourite locations for free wifi are Sakura Do in Xinle Lu and Wagas at The Loft.

Hopefully the need to use Shanghai wireless access points will diminish as 3G devices and data plans start to become pervasive and cheap over the next year or so.

I left this comment on Dan Washburn’s post:

The new Iphone 3G is not much of a hardware upgrade apart from 3G and GPS.
The biggest change is the availability of downloadable apps from the Itunes store. This is available to Iphone 1 users who upgrade to Itunes 7.7 and Iphone 2.0 firmware.

There are some really promising apps such as Evernote and Modium, but there is no VOIP app at the Itunes store. You will need to jailbreak
It will be a little while before people like DVD Jon find a way to jailbreak the new Iphone firmware so it can be run freely in China, and the unofficial apps like Fring (for VOIP) can be run on the same handset as the Itunes apps.

It is also worth noting that 75 percent of downloadable Itunes apps have to be paid for. Given that a quarter of Iphone users are running jailbroken handsets in China, Apple is going to have find a way to bring the Middle Kingdom back into the fold. Otherwise, all those Chinese Iphone users are not going to be able to download official apps even if they want to pay for them.

Another commenter tripped me up for my confusion about unlocking and jailbreaking an Iphone. I lumped them together, but this point is moot for most Iphone users in China. They buy handsets that are already unlocked and jailbroken. That has been the experience among my students and colleagues.

Those who need further help on this issue should make regular visits to this website by Lawrence of Computer Solutions.

There was also some confusion about using paid for apps in China. Even if there is a software fix that allows Chinese Iphone users to run jailbroken and offiicial apps side by side, there is still a problem that there is no Chinese Itunes store. Chinese Iphone users cannot use a locally registered credit card to purchase apps from the Itunes store.

Apple needs to quickly setup a Chinese Itunes store and launch an offiicial handset on the mainland. Otherwise you get the absurd situation that everyone in its second biggest market where the handsets are manufactured is operating in a black market. This includes senior Apple employees based in China. (I’m keeping Mum!)

Further Reading
Iphone In China
iPhone Countdown for Mainland China?
Don’t Worry The Black Market Is Working Iphone In China Still Selling Like Hotcakes
Better Than Jailbreaking Except
What’s Good And Free In The Itunes App Store