China’s mobile internet ‘ecosystem’ taking shape but challenges remain

PUBLISHED : Friday, 26 June, 2015, 8:00am
UPDATED : Friday, 26 June, 2015, 11:16am

China is developing a mobile internet ecosystem based on its rapid adoption of smart devices, big data and e-commerce, according to a new industry report.

This falls in step with Premier Li Keqiang’s "Internet Plus" policy, which he introduced in March in a government work report. 

Li has called for the integration of mobile internet, cloud computing and big data, while also pushing e-commerce, industrial networks and online banking.

Although mobile internet user growth is losing momentum in China, the country is building the world’s largest 4GB mobile internet network with more than 800,000 internet towers, the 2015 Mobile Internet Blue Paper said this week.

Released by the People’s Daily Research Institute on Wednesday, it focused on the overall development of China’s mobile internet industry, as well as extended research into artificial intelligence, and online to offline business models. 

Leading Chinese smartphone makers Lenovo, Huawei and Xiaomi sold millions of handsets in the last quarter of 2014, for a combined 17 per cent share of the global market, it said.

There are over 630 million internet users on the Chinese mainland and 570 million mobile phone subscribers, China’s Ministry of Industry and Information Technology announced last year.

The country, which is ramping up investment in internet terminals and other related infrastructure, has an estimated three million mobile app developers, up 16 per cent from 2014, the report said.

Over 1,000 investment deals were made in China’s internet industry last year, worth a record US$16 billion, it said.

But the burgeoning ecosystem faces a series of challenges despite ushering in a new era of mobile payments, with even basic medical services now being conducted in the palm of a hand. 

Internet speed is among the issues waiting to be addressed. 

Mobile users in South Korea, Japan and the United States have the fastest internet speeds in the world. They also consume the highest amount of mobile data. 

In contrast, Chinese consume an average of 210 MB per month, below the global average of 270 MB, the report said. 

In the middle of May, major Chinese telecom operators pledged to cut mobile data fees and internet service charges in response to calls by Li. However, none of the three big players have yet made good on their promises.

The report found that China’s mobile phone owners consume much less video data than their counterparts in South Korea and Japan. Most of their data gets gobbled up by Web browsing and instant communication, it said.

Overall, the State-run institute's report said there is much room for China to grow in terms of mobile data consumption compared to its more developed Asian neighbours.

While social media has exploded in China in recent years, many registered accounts may be “fake”, according to a separate report released by the Chinese Academy of Social Sciences on Wednesday.

A national policy imposed by Beijing to promote use of the internet and social media compelled many state organs and companies to sign up for accounts they never use, it said. 

Amid a growing threat, China also needs better regulation of its cybersecurity industry, while its e-finance requires stronger monitoring, the academy found.