Page 270 - 2017 White Paper
P. 270
7 White Paper on the Business Environment in China
boost for Apple in a country where it’s trailing rivals, even via WeChat, Tencent’s mobile messaging app. There’s no
though China is its second-largest market after the U.S.”. doubt about it – the Internet is fundamentally altering
The deal could reportedly generate as much as “$3 billion the fabric of daily life in China (Woetzel et al.).
in revenue [for Apple] in 2014” (Reuters 2014).
By January 2016, China recently hit another important
Meanwhile, “China Telecom [picked] Alcatel-Lucent milestone in its Internet development. For the first time
to supply its next-generation 4G technology for a ever, Internet penetration in China reached more than
nationwide trial of high-speed mobile broadband” half the population. At the end of 2015, China reached 688
(Reuters 2013). In March 2014, according to Wei Zaisheng, million Internet users, more than double the population
the finance director for ZTE, the Chinese state-owned of the United States. And China’s new Internet users are
equipment maker, as told to the Financial Times, that mobile native, with more than two-thirds preferring to
from 300,000 4G base stations, China is slated “to have as surf – and purchase – via their smartphones (Lee 2016).
many as 1 million” by the end of the year (Thomas 2014).
The spread of Internet connectivity into every
China witnesses an explosive growth of the internet, corner of the world’s third largest country by area had
where, even though it is a latecomer industry entrant, long attracted the attention of the Chinese authorities.
the sheer rapid development of its information and Indeed, the most recent, 13th Five-year Plan includes
technology capabilities shows that far from lagging blueprints for a tri-network convergence combining
behind its counterparts in the developed world, China is telecommunications, broadcasting services and the
now proving that it can actually play with the big boys Internet on a single platform to deliver user content –
and is quickly dictating its terms on its own playing field. estimated by Ernst & Young to inject an added US$250
billion worth of demand when completed. To supply this,
On September 20, 1987, Professor Qian Tianbai sent spending on Internet access is expected to soar to US$78
China’s first E-mail titled “Crossing the Great Wall to Join billion in 2018 (Dezan Shira and Associates and Brandeis
the World”, marking the beginning of the use of Internet School of International Business 2015).
by Chinese. Professor Qian was in charge of the Internet
project of CANET (Chinese Academic Network), a scientific In the 13th Five Year Plan, the new policy, dubbed
research project launched by the Beijing Municipal “Internet Power”, emerged as a central theme. “Internet
Computer Application Research Institute in 1986 in Power” (wangluo qiangguo), as defined by China File, is a
cooperation with Karlsruhe University of former Western “multifaceted strategy that promises to deliver significant
Germany (China Education and Research Network 2001). state support to the nation’s domestic technology
From those humble, tentative beginnings at the end industry while also seeking to influence global Internet
of the 1980s, China joined the digital revolution with a governance and opinion” (Lingvingston 2016).
vengeance and never looked back.
In 2013, China’s Communist Party had conducted a
The numbers are truly staggering, whether viewed major reform of China’s Internet policymaking bodies,
from the consumer perspective, as of 2014: 632 million creating the Central Leading Group for Cybersecurity
users, 700 million active smart devices, US$ 300 billion in and Informatization. This group was led by President Xi
e-retailer sales, 4.4% as size of China’s internet economy Jinping and tasked with developing broad Internet policy.
vs. total GDP (higher than the U.S. or Germany). Or viewed At the same time, the previously under-utilized State
from the enterprise perspective: 7% to 22% as internet Internet Information Office was renamed the Cyberspace
contribution to total GDP increase through 2015, 22% Administration of China (CAC) and tasked with regulating
growth of internet contribution to China’s productivity, online content (Lingvingston 2016).
10 trillion yuan as annual GDP at stake by 2025. During
the course of 2013, the number of active smart devices Speaking at the inaugural meeting of the
grew from 380 million to 700 million. On Singles Day 2013, Cybersecurity Leading Group in February 2014, China File
the e-commerce marketplaces Taobao and Tmall posted reports, President Xi first introduced the idea of China
more than 36 billion yuan (almost US$6 billion) in sales in developing into an “Internet Power”: “Cybersecurity and
just 24 hours. Some five billion daily searches are made informatization concern national security and national
through Baidu, and hundreds of millions communicate development, and are a major strategic issue for the work
270
boost for Apple in a country where it’s trailing rivals, even via WeChat, Tencent’s mobile messaging app. There’s no
though China is its second-largest market after the U.S.”. doubt about it – the Internet is fundamentally altering
The deal could reportedly generate as much as “$3 billion the fabric of daily life in China (Woetzel et al.).
in revenue [for Apple] in 2014” (Reuters 2014).
By January 2016, China recently hit another important
Meanwhile, “China Telecom [picked] Alcatel-Lucent milestone in its Internet development. For the first time
to supply its next-generation 4G technology for a ever, Internet penetration in China reached more than
nationwide trial of high-speed mobile broadband” half the population. At the end of 2015, China reached 688
(Reuters 2013). In March 2014, according to Wei Zaisheng, million Internet users, more than double the population
the finance director for ZTE, the Chinese state-owned of the United States. And China’s new Internet users are
equipment maker, as told to the Financial Times, that mobile native, with more than two-thirds preferring to
from 300,000 4G base stations, China is slated “to have as surf – and purchase – via their smartphones (Lee 2016).
many as 1 million” by the end of the year (Thomas 2014).
The spread of Internet connectivity into every
China witnesses an explosive growth of the internet, corner of the world’s third largest country by area had
where, even though it is a latecomer industry entrant, long attracted the attention of the Chinese authorities.
the sheer rapid development of its information and Indeed, the most recent, 13th Five-year Plan includes
technology capabilities shows that far from lagging blueprints for a tri-network convergence combining
behind its counterparts in the developed world, China is telecommunications, broadcasting services and the
now proving that it can actually play with the big boys Internet on a single platform to deliver user content –
and is quickly dictating its terms on its own playing field. estimated by Ernst & Young to inject an added US$250
billion worth of demand when completed. To supply this,
On September 20, 1987, Professor Qian Tianbai sent spending on Internet access is expected to soar to US$78
China’s first E-mail titled “Crossing the Great Wall to Join billion in 2018 (Dezan Shira and Associates and Brandeis
the World”, marking the beginning of the use of Internet School of International Business 2015).
by Chinese. Professor Qian was in charge of the Internet
project of CANET (Chinese Academic Network), a scientific In the 13th Five Year Plan, the new policy, dubbed
research project launched by the Beijing Municipal “Internet Power”, emerged as a central theme. “Internet
Computer Application Research Institute in 1986 in Power” (wangluo qiangguo), as defined by China File, is a
cooperation with Karlsruhe University of former Western “multifaceted strategy that promises to deliver significant
Germany (China Education and Research Network 2001). state support to the nation’s domestic technology
From those humble, tentative beginnings at the end industry while also seeking to influence global Internet
of the 1980s, China joined the digital revolution with a governance and opinion” (Lingvingston 2016).
vengeance and never looked back.
In 2013, China’s Communist Party had conducted a
The numbers are truly staggering, whether viewed major reform of China’s Internet policymaking bodies,
from the consumer perspective, as of 2014: 632 million creating the Central Leading Group for Cybersecurity
users, 700 million active smart devices, US$ 300 billion in and Informatization. This group was led by President Xi
e-retailer sales, 4.4% as size of China’s internet economy Jinping and tasked with developing broad Internet policy.
vs. total GDP (higher than the U.S. or Germany). Or viewed At the same time, the previously under-utilized State
from the enterprise perspective: 7% to 22% as internet Internet Information Office was renamed the Cyberspace
contribution to total GDP increase through 2015, 22% Administration of China (CAC) and tasked with regulating
growth of internet contribution to China’s productivity, online content (Lingvingston 2016).
10 trillion yuan as annual GDP at stake by 2025. During
the course of 2013, the number of active smart devices Speaking at the inaugural meeting of the
grew from 380 million to 700 million. On Singles Day 2013, Cybersecurity Leading Group in February 2014, China File
the e-commerce marketplaces Taobao and Tmall posted reports, President Xi first introduced the idea of China
more than 36 billion yuan (almost US$6 billion) in sales in developing into an “Internet Power”: “Cybersecurity and
just 24 hours. Some five billion daily searches are made informatization concern national security and national
through Baidu, and hundreds of millions communicate development, and are a major strategic issue for the work
270
