CHINA INTERNET MARKET BRIEF -
2010
July 16, 2010 - Soaring growth continues - According
to the latest figures from CNNIC, the number of Internet users in
China rose to 420 million at the end of June, 2010, an increase of
almost 36 million users in the first six months of year 2010 and including
115.1 million users in the rural areas. The current Internet penetration
rate in China is 31.6% acording to Internet World Stats statistics.
Mature netizens take a larger percentage in the age structure of
the Chinese Internet users than before, and those above the age
of 30 account for 41% of the total. At the same time, the educational
background and income level of the Chinese netizens has lowered.
The time period spent in the use of the Internet by Chinese netizens
continues to increase and reached an average of 19.8 hours per week per user.
Insufficient bandwidth continues to be a problem for the Chinese
Internet sector. At present, the penetration of broadband in China
has reached 98.1% and the number of people using broadband is 364 million.
Statistics from Akamai, a U.S. distributed computing platform for global
Internet content and application delivery, shows that the average Internet
speed in China is 857kbps, which is much slower than that in the U.S., Japan,
and South Korea.
CNNIC also reported that the number of IPv4 addresses in China had reached
250 million, an increase of 7.7% compared with six months ago. IPv4 address
resources are nearly exhausted and a transition to the IPv6 addresses is
imperative.
INTERNET USAGE IN
CHINESE RURAL AREAS - 2007
On September 7, 2007, the China Internet Network
Information Center (CNNIC) published "Survey Report on the
Internet Usage in Chinese Rural Area". This is the first full
scale survey report published in China regarding the macro
Internet development situation in rural areas of China. The
report shows that the number of Internet users in Chinese rural
areas has exceeded 37 million, and that their major application
is online entertainment, which equals the level in urban
areas.
The Digital Divide between urban and rural areas is still
obvious. The report shows that by the end of June 2007, the
number of the rural Internet users reached 37.41 million. The
penetration rate of the Internet for all 737 million rural
residents is only 5.1%. Meanwhile, China has 125 million urban
Internet users, with an urban penetration rate of 21.6%. However,
comparing with the statistics of December 2006, the gap has been
gradually narrowed. China had 23.1 million rural Internet users
in 2006, with a penetration rate of 3.1%.
The main bottleneck is that at year end of 2006, every 100
households in rural areas possess only 2.7 computers, which is
far behind the figure for urban areas (47.2 computers). Comparing
with the figures for the same period in 2005, the computer number
increased from 0.6 in every 100 rural households, while the urban
households now have 5.7 computers more. The report also indicates
their reasons for not using the Internet. The main one is "have
no facility", which accounted for 39.5% of all non-users in rural
areas, while this proportion in urban areas is only 26.6%. Due to
the lack of household computers, 53.9% of rural users surf online
in Internet cafes, resulting in a much higher figure that even
exceeds the national average Internet café surfing rate of
37.2%. Insufficient Internet infrastructures in rural areas has
become the major bottleneck that blocking the development of the
Internet usage in Chinese rural areas.
Comparing with urban users, the application level of rural
Internet users is less advanced. The report shows that 66.5% of
rural users read online news, while the proportion in urban areas
is 81.5%, which is 15 percentage points higher; 65.8% of the
rural users use search engines while the rate in urban areas is
13 percentage points higher (78.4%). Besides, much less users in
rural areas have ever touched online purchasing, online banking
and online stock trading.
It was found in the survey that rural users and urban users
have similar access level for online entertainment. The rates of
listening online music, playing online games and watching online
movies and TV series of rural users are respectively 68.9%, 47.1%
and 60.9%, comparing to 68.4%, 47.0% and 61.2% of urban
users.
The survey also involved rural migrants. The statistics show
that rural migrant users reached 20 million and that most of them
access the Internet in Internet cafes or through their mobile
phones. For that matter, they averagely pay 86.6 RMB Yuan per
month, that is 11 Yuan higher than the average level of the total
Internet users (75 RMB Yuan) and even higher than the total
non-student users monthly cost of 80.8 RMB Yuan.
In conclusion, along with the progress of rural
informatization access in China, the Internet has become a
substantial part of the building of a new-type rural area. 37
million rural users are bringing vast demand and real business
opportunities. No one doubts the rural area in China will become
a great Internet market.
CHINA INTERNET REPORT -
2006
January 23, 2007 - According to the "19th Statistical
Survey Report on Internet Development in China" published today
by CNNIC, Internet users in China have reached 137 million,
approximately 10.4% of China’s population, at the end of
year 2006.
The Internet penetration in Beijing exceeded 30% for the first
time. Regarding broadband, 75.9% of Chinese Internet users, about
104 million people, use broadband connections that include xDSL,
Cable Modem and leased line. Mobile phone Internet users have
also expanded and now total 17 million subscribers.
China’s Internet users increased by 26 million in one
year, comparing with December, 2005, showing a growth rate of
23.4%. This compares very positively with the growth rate in
previous years (18.2% in 2004 and 18.1% in 2005).
The number of registered .CN domain names in China increased
remarkably to 1,803,393 - an increase of 64.4% in just one year.
Total domain names in China now amount to 4,109,020, which is
1.16 million more than 6 months ago, with an average growth of
200 thousand per month. The report results show that at the end
of 2006, China had 4.47 billion domestic webpages and 122,306 GB
of local webpage contents. The annual growth rates of these two
are 86.3% and 81.7% respectively. Along with the vast growth of
these domestic Internet resources, the total websites and IPv4
addresses in China also grow rapidly and reached 843 thousand and
98 million respectively.
CHINA INTERNET MARKET -
2004
October 27, 2004 - With a population of 1.3 billion,
China is the biggest country in the world. The Chinese NIC
estimates that China's Internet population grew 28 percent over
the past year to 87 million, while use of broadband in that
country is soaring. The number of PCs sold in China last year
reached 22 million (2nd after U.S.), the number of cell phones
sold in 2003 reached 150 million (1st in the world), and there
were 1.7 billion instant messages sent. The number of broadband
users has reached 31.10 million, an increase of 13.70 million
over the past 12 months (an increase of 78.7% over a 6 month
period).
China's online shopping market was worth 4.2 billion yuan
(US$507.5 million) last year according to market research firm,
Shanghai iResearch, and is expected to double this year.
Therefore it is no surprise that global Internet giants --
including eBay Inc., Yahoo Inc. and Amazon.com Inc. -- have all
taken the China plunge lately, paying a combined US$375 million
to acquire domestic start-ups in China, according to the China
Business Weekly.
China is both a buyer and seller of products and services
worldwide. China is a major global economic force and will grow
dramatically in the foreseeable future. The number of Internet
users in China increases by 800,000 a week, and in July
PricewaterhouseCoopers projected that China’s media sector
would achieve a 25 percent growth in revenue through 2008 due to
an increase in online advertising.
Even with statistics like these, marketers must note one
interesting challenge for selling to China’s consumers
online. China has a very cash-oriented economy -- very few people
have credit cards -- which makes transactions with customers
outside a particular locality difficult. According to the China
Business Weekly, the nation's credit card holders now number 2
million, a fraction of its 1.3 billion people.
There are, however, many initiatives taking place to penetrate
into this market. For example, online travel agent Ctrip.com
recently announced the launch of a travel credit card with China
Merchants Bank Co Ltd. Additionally, companies such as EBay's
Paypal online payment unit has hired consultants to figure out
how to tap into the Chinese market.
It's time for global firms to market to Chinese companies and
consumers via the Internet. As we've all seen from the emergence
of the English language Internet, first-movers have a significant
advantage over those that follow. For marketers wishing to
penetrate this market, the following elements should be
considered:
1. Web Site Design
This could mean simply a
translation of Web sites into Chinese, or re-designing them
completely in order to be culturally and aesthetically
correct.
2. Search Engine Optimization (SEO)
Just like with English language search engines, users can
increase their chances of being among the top hits on Chinese
language search engines by altering and optimizing their web
content.
3. Online Auctions
The world leader eBay has
already entered the Chinese market, and there are other global
Internet auction sites that marketers may want to use.
4. Online Advertising
China's Web sites carry advertising (including Google-like
adwords) just like English language Web sites. You need local
advertising to enter this specific market.
5. Online Public Relations
There are several Chinese print and electronic publications that
receive press releases via email. This option should be
considered for additional publicity.
