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China a leader in global internet market: Report

By Zhu Lingqing | chinadaily.com.cn | Updated: 2017-09-14 14:02

China a leader in global internet market: Report

People surf the internet in Nanjing Future Network Town, East China's Jiangsu province, May 10, 2017. [Photo/VCG]

China has become a leader in global internet industry, exerting great influence and displaying its own characteristics of market, users and competition patterns, a report said.

The report, co-released by the Boston Consulting Group (BCG), AliResearch, Baidu Development Research Center and Didi Policy Research on Wednesday, said China's internet economy is big and unique, fast-developing, vibrant and volatile.

Having 710 million internet users in 2016, the largest number in the world, China's internet consumption reached $967 billion, second only to the United States and nearly three times the consumption of the third-ranked Germany, the report said.

In addition, the proportion of the internet industry's GDP or eGDP in overall GDP in China reached 6.9 percent last year, 1.5 percentage points higher than the US.

Chinese internet giants and unicorns (young unlisted companies with a market value of over $1 billion) have also become more influential globally. The report said China grabbed five spots at the ranking of world's top 10 internet listed companies in market value as of June 30. Alibaba and Tencent closely followed Google, Amazon and Facebook.

It said 29 percent of the world's unicorns are based in China, accounting for 41 percent of the total market value of global unicorns.

"On a gigantic scale, China's internet industry can still maintain rapid?pace?because of three driving factors, which are the overall healthy economic environment, the internet industry's high transparency and a large gap in the market," Li Shu, partner and managing director of BCG said, according to a report by tech.sina.com.cn.

Compared to the US, China's internet economy is more concentrated on e-commerce and internet finance, while public service, local service and online travel are relatively left out, the report found.

The report said the average age of Chinese internet users is 28 years old, while it is 42 in the US. They are younger, more grass-rooted and more accepting of accessing the internet through mobile phones and more fickle in affection.

Gao Hongbin, head of AliResearch, a think tank affiliated with Alibaba, said a new development model will bring new rapid development opportunities for China's internet, according to the report.

"New retail, new manufacturing, new energy, new finance and new technologies will become the important directions of business model innovation for Chinese internet companies," Gao said.

In addition, the report said Chinese internet's characteristics have also influenced the way how Chinese internet companies expand abroad.

They tend to adopt more flexible models such as making strategic investments, taking stakes, or establishing partnerships to quickly adapt to the local market, the report said.

 

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