Chinese internet users surge to 802 million in test of government’s ability to manage world’s biggest online community

There are now as many internet users in China as there are people in the United States, Indonesia and Brazil combined.

While two in five Chinese are still offline, the country’s internet population has grown big enough to open huge market opportunities for hi-tech companies, and provide the government with better access to keep watch over its citizens, according to an analyst.

China surpassed the 800-million mark for the number of internet users for the first time, further cementing its position as home to the world’s biggest online community, as the country kept up its investment in infrastructure and pushed to lower access fees.

The number of internet users in China rose by 30 million in the first half of this year to 802 million, representing a penetration rate of 57.7 per cent, according to a report by state agency China Internet Network Information Centre (CNNIC) released on Monday. All but 1.7 per cent of the users access the internet through mobile devices, according to the report.

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“[Expansion of internet access] is a double-edged sword. It’s good for internet companies, and good for the government if they want to control the population better, but it also means there are more risks,” said Shaun Rein, the managing director at China Market Research Group. “It’s easier for a lot of criminals to push gambling, pornography or drugs because it is such a large internet market.”

As of June this year, seven in 10 Chinese internet users have shopped and paid for purchases online. About 566 million people use mobile payment, an increase of 7.4 per cent compared with six months earlier.

The sheer scale of China’s internet population means that the number of mobile internet users in China is three times bigger than that of the US, and the number of mobile payment users is up to 12 times larger, according to data compiled in the China Internet Report, co-authored by the South China Morning Post, its online tech news site Abacus and San Francisco-based venture capital firm 500 Startups.

China’s expansion in internet services is underpinned by continuous investment in infrastructure. The government’s recent policy to increase internet speeds and make access more affordable has also helped promote growth, according to the report.

While the Chinese government has been a main driving force behind the development of the domestic internet, it is also trying to manage the internet. The state is “the visible hand” where success or failure – especially for media and entertainment companies – depends on its approval, according to the China Internet Report.

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In April, China’s media regulator ordered news aggregator Jinri Toutiao and Tencent Holdings-backed live-streaming video service Kuaishou to clean up content on their platforms, singling out both operators for disrupting order in the online media industry. More popular news and video apps – most recently the anime, comic and games-focused Bilibili – have been taken offline for content deemed “inappropriate” or “vulgar” in the past few months.

Short video app Douyin was criticised by an internet watchdog in July after one of its advertisements was found to be disrespectful to one of the country’s most-respected wartime martyrs.

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The CNNIC report also noted the popularity of short-video apps and other online entertainment. About three in four internet users use short-video apps to entertain themselves, according to the report. At the same time, online entertainment content has seen further regulation, with a clampdown on illegal content in online games in the first half of this year, the report said.

On Tuesday, a commentary by the Communist Party mouthpiece People's Daily called for stricter regulations, enforcement and punishment to clean up online advertising, describing fraudulent ads as a “malignant tumour”.