Internet Innovation in China.pdf - ITU

22 Pages·2014·3.93 MB·English

Liu Duo
China Academy of Telecommunication Research, MIIT
July 1st, 2014
Internet Users in China Totaled 618 Million
User base ranking No.1 in the world; growth rate maintaining at 10%;
penetration rate 46%: still plenty of room for development.
Source: KPCB 2014，CNNIC 2014
2
Mobile Internet Users exceeded 500 Million
Mobile internet is enjoying robust growth, with its users taking up over 80% of
all Internet users, one of the highest ratios in the world.
Source: KPCB 2014
3
Internet services generated a revenue of 647 billion yuan
in 2013
In 2013, Internet service revenue registered a year-on-year growth of 42%. The
revenue is estimated to surpass 850 billion in 2014, up by 34% year on year.
10000 Forecast of the scale of Internet service revenue in China
（Unit:100 million yuan）
8648
基础企业互联网宽带接入收入
Revenue of basic enterprises from Internet broadband access
8000
基R础eve企nu业e o移f b动as数ic 据ent及er互pri联ses网 fr业om务 m收ob入ile data and Internet services
6469
增R值ev企enu业e o因f v特al网ue-接ad入ded服 e务nte收rpr入ise(sI SfrPo)m Internet access services (ISP) 4005
6000
增R值ev企enu业e o因f v特al网ue-信ad息ded服 e务nte收rpr入ise s from Internet information services
4570 3081
182
4000
3333
2031
152
3059
2168
1333
127
1974
2000 116
991 1270
859
72
200
905 1025 1142 1263 1401
0
2010 2011 2012 2013e 2014e
Source：CATR, 2014
4
Chinese Internet Enterprises Grabbed 4 Seats out of the Global Top 10 in terms of
Market Value
Global Internet Enterprises Top10 in terms of Market Value
6000
5546 (Unit: 100 million dollars)
5000
3893
4000
3000
2000
1493 1426
1162
1000 647 635 632
383 352
0
Notes:
1) The statistics of market value were collected on June 27th, 2014.
2）The statistics of Alibaba come from its self-evaluated market value in the document it submitted to the SEC
of America on June 27th, 2014.
5
Visitor Volumes of Backbone Internet Enterprises also Rank Among the Tops
in the World
Source: KPCB, 2014, data from com Score March, 2014
6
Three Phases of Internet Innovation and Development in China
Innovation is the fundamental driver behind the development of Internet in China. In
China, Internet innovation went from simple C2C（copy to China） to local model
innovation. Starting from 2010, with growing industrial strength, the new revolution
initiated by mobile technology and cloud computing, China’s Internet industry is
embracing a new phase of technological and model innovation.
1996~2005 2005~2010 2010~
Phase
Model+
Copy to China Model Innovation
Technological Innovation
Portal Era Web2.0 Era Mobile and Cloud Era
Language translation (into Centering on the innovation Innovation all over cloud
Feature
Chinese), function of business model platforms, smart pipe, and
localization terminals
Sina portal, Baidu Search, QQ’s flourishment, 360’s
Data center, Baidu Brain,
QQ free antivirus software,
Cases in Xiaomi Phone, WeChat
Alipay credit mechanism
point
7
An Open Internet Innovation Pattern Is Taking Shape
Internet Application Innovation
Cloud Computing/Big Data
Technologies and Services
EUROPE ASIA
N. AMERICA
Infrastructure and
Product Innovation
AFRICA
Future
S. AMERICA
Internet
Research
OCEANIA
8
Internet Application: “Micro Innovation” Enabled New User
Experience
After integrated with payment instruments, public accounts, third-party applications, etc., WeChat
changed from a social app to a new mobile Internet portal that combines multi functions including
social contact, payment, media and open platform.
Integrated
with Didi Taxi
that accepts
WeChat
Financial
Payment
/Investment
Management
Integrated
Integrated with other
with habitual
dianping.com payment and
that provides daily life
dining choices
recommenda-
tions
WhatsApp maintains its positioning as a
pure social app. Although a paid app, it is
far less commercialized than WeChat.
9
Internet Business Model: New Thinking Ushered in a New Phase
360’s Free Antivirus Software Model
 In 2006, 360 released its free antivirus software; in 2008,
360 announced that its antivirus software products shall be
permanently free.
 Free antivirus software fueled the popularization of
Internet security products. The penetration rate of security
software rocketed from 53.9% to 97.5%. Antivirus software
became a free Internet service, just as search service, social
networking service and consulting service.
Xiaomi’s “Fan Base Marketing” Model
 Use Weibo, WeChat and BBS as major marketing
platforms, and attract fans through event marketing and
paid review.
 Create “fans’ sense of participation”: invite fans to
involve deeply into the design and R&D process of products
instead of merely providing problem feedbacks, so as to
build mutual trust between the company and fans.
 Hunger marketing
10