2006 Chinese Internet Data : Advertising, Search Engines & Blogs

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The Internet speed has been slowly improving in China but the latest news is that the final repairs will be finished half way February instead of the end of January. What the really losses are due to the lack of international connections will probably never be known but it had and still has a daily negative impact on businesses in China dealing with the rest of the world.

This installment I like to focus more on the latest available Chinese Internet data.

Getting the right data is a challenge, the data that are published are not always representing the reality and whether this is related to growth figures for the economy or related the Internet, some skepticism has to be applied. They do give an indication though and the fact that the numbers in absoluteness are impressive they are still usable.

According to a survey by the Internet Society of China there are now 136 million Internet users in China (In a couple of weeks the China Internet Networking Information Center will come with its half yearly report on the number of users so there will be something to compare).

The total spending by individual Internet users in China in 2006 rose by nearly 50 percent to 276.7 billion Renminbi (US$35.51 billion). Included in this amount are the cost of online shopping, games, cell phone ring tones, and all other cyberspace services.

But as the China Herald rightly points out, spending includes the cost for internet access that is at a minimum of 120 Rmb per month for ADSL. (My monthly subscription fee is even more, 150 Rmb)

Even taking into account that family members may share connections, it still doesn’t leave much budget yet for buying.

China Internet Stats 2006

The majority of the Internet users are young and most of the rest of the money will probably go to gaming and ringtones. In 2005 the average spending was 158 Renminbi. The good news is that there is growth but it will take some more time for the big online shopping boom sets in.

Online advertising (excluding Search Engines) showed a growth of more than 50 percent. In 2005 advertisers spend 3.3 billion (US$423.4 million) and in 2006 more than 5 billion Renminbi (US$641.5 million) found its way to Chinese websites. Most of the money went to the big portals, Xinhua)

I don’t know what is regarded as a click here and I actually read similar articles mentioning 101 million hits. That would result in an average of 5 clicks/hits per blog. I assume that number should be higher, even in unique visitors. It’s likelier that is meant that 101 million users read the blogs in 2006 but still, these metrics basically don’t make much sense.

The chart as well as the stats are based on the stats mentioned in several articles as well as in the report. I can’t guarantee 100 percent accuracy but it gives a bit of an overview on what’s going on in China.

The main constant is that the number of Internet users is growing fast. Online shopping and advertising still has some catching up to do.

Gemme van Hasselt is an Internet Marketing Consultant, living in Shanghai, China.

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  • CarstenCumbrowski

    Thanks Gemme,

    Interesting numbers and good that you mentioned that the cost for the Internet connection is included in the spending and how much the cost are 🙂

    Just out of curiosity. Does any of the big US data collection and statistics companies do business in China and opened up a branch or something, or is it all done by the Chinese? What is the know how of the tracking? Sophisticated, Good, Amateurish or beginner?


  • Gemme

    Good questions Carsten and for some I still would like to know more myself.

    Statistics are mostly coming from semi-state organs and the private Chinese market research companies are mostly connected to them one way or another. When I read their reports, mostly the English ones, one thing that I notice is that, I whisper this, they tend to be biased when it comes down to Baidu and other Chinese players.

    Having said that, without a doubt the number of Internet users in China is rising and also without a doubt Baidu is the biggest player but whether the numbers and the research methods are the only things taken into account is not a given to me. I have to say that I tend to approach whatever statistics, whether in China or elsewhere, with some skepticism as they mostly are published for a certain purpose.

    In China, statistics, whether it’s about the economy or in this case, about Internet users, have the purpose to show how well the country is doing in its development. But truth be told, the number of Internet users is going fast and probably is accurate.

    The bigger players, like Nielsen are active in China but I haven’t seen reports by them about the Internet market yet. It’s predominantly Chinese companies, there are more now than before that do this research. I can’t say much on how sophisticated they are, would make for a separate study:) but from what I hear from people that have dealt with them there are still some steps to made. That’s hearsay though.

    The latest Internet survey report was released yesterday by the China Internet Network Information Center and puts the current number at 137 million users. I have the report and can hopefully extract some more interesting info from it for a next post.

  • Dennis


    Thanks for the numbers! Would just like to check if the numbers include the data from HK?