Morgan Stanley
India | Friday, 25 July 2008
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China ties US for most Web users at 221 million people

By Joe Mcdonald
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Posted 24 April 2008 @ 05:03 pm GMT

China's fast-growing population of Internet users has soared to 221 million, tying the United States for the largest number of people online, according to government data reported Thursday.

In this March 6, 2008 file photo, people surf the web at an Internet cafe in Shenyang in northeast China`s Liaoning province
In this March 6, 2008 file photo, people surf the web at an Internet cafe in Shenyang in northeast China`s Liaoning province. China`s booming population of Internet users has soared to 221 million, tying the United States for the biggest number of pe...

The figure, reported by the Xinhua News Agency, reflects China's explosive growth in Web use despite government efforts to block access to material considered subversive or pornographic. It was a 61 percent increase over the 137 million Internet users reported by the government at the start of 2007.

China lags the United States, South Korea and other markets in online commerce and other financial measures. But e-commerce, video-sharing and other businesses are growing quickly and companies have raised millions of dollars from investors.

"We'll see this growth continuing," said Duncan Clark, chairman of BDA China Ltd., a Beijing technology company.

"Even though China might overtake the United States in total (Internet) population, it still lags in the size of its Internet industries, and there will be a lot more opportunities," Clark said.

China's Internet penetration is still low, with 16 percent of people online, compared with a world average of 19 percent, Xinhua said.

Beijing promotes Internet use for business and education but operates extensive online censorship. Web surfers have been jailed for posting or e-mailing material that criticizes Communist rule or is deemed a violation of vague national security laws.

Most recently, Chinese Web surfers have been blocked from seeing foreign sites including YouTube.com with videos about protests in Tibet and the security crackdown there.

The Xinhua report cited data from the government's China Internet Network Information Center. An agency spokeswoman, who would give only her surname, Zhang, declined to give more details. She said the agency, also known as CNNIC, would release a report in July.

The United States had 221 million Internet users in March, according to Nielsen/NetRatings, a leading industry measurement service. The U.S. growth rate is lower, suggesting that when March figures for China are released they may show that the country has already overtaken the United States.

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