China Internet: Who’s On First?

                          ( Photo: China Daily)

                             by David Parmer

An old expression from American baseball is: You can’t tell the players without a scorecard.This means you can’t understand a situation until you have some concrete information. This concept clearly applies to the Internet in China. It is hard to easily describe the vibrancy, the fluidity, the size and scope of China’s Internet. Not only are there a multitude of players, but positions are always changing. Reports rate the players in search, e-commerce or social media, but just a few months later, the data is obsolete. Companies jockey for position, and players rise and fall in ranking. Try to find out who has the biggest market share in the search category, for example, and you will probably come up with Baidu, but then the second to fifth tier search companies seem to be always changing in terms of rank and users depending on who is reporting, and who is counting. The Chinese Internet has about 591 million users, this seems to be the agreed-upon figure, after that all bets are off.

 Search

Baidu        50% to 60%

Qihu (360) 20% to 25%

Sogu         10% to 12%

Google      1.3% to 1.6%

In March 2014 a government backed search engine ChinaSo was launched with the backing of Xinhua and China Mobile. Most analysts have low expectations for this new service.

 e-Commerce

Chinese e-commerce is a two- tier system with B2C (Business to Customer) and C2C (Customer to Customer) models in place. The leaders are:

 B2C

TMall (Alibaba)      50%

Jindong (Tencent)  17%

 C2C

Taobao (Alibaba)

PaiPai   (Tencent)

 Figures for B2C sales were $25.6 billion, and a whopping $71 billion for C2C. Of interest in the e-commerce segment is a reported migration of customers from C2C digital market places to B2C sites. Reasons given are that customers are tired of shoddy goods and are looking to more vendor reliability.

Social Media

In social media the Alibaba vs Tencent model continues. eModeration reports that 91% of Chinese Internet users have a social media account. The numbers for early 2014 look like this:

 QZone (Tencent)               712M users

Tencent Weibo                  507 M users

Sina Weibo                        500 M users

We Chat (QQ)                   300 M users

Pengyou                            259 M users

As mid-year 2014 approaches, it looks like his year will be another dynamic year for China’s Internet. And with the economy officially shifting to a domestic consumption model, the non-stop development, expansion and dynamism of China’s Internet can only continue to grow.

 (Data: eModeration/Tech in Asia)