With the world’s largest and fastest growing online population, China continues to attract global online businesses of all industries. The Chinese market offers vast revenue opportunities and growth, but companies must overcome a magnitude of technical and regulatory challenges to effectively reach online users in China. Internet censorship, unreliable infrastructure, and complex web content licensing requirements make it difficult to effectively deliver websites and cloud applications into China. In this webinar, CDNetworks and guest speaker Forrester Research, Inc. will discuss the overall opportunities presented by the China web market and explore the various web performance and regulatory challenges companies must overcome to effectively deliver web content and applications within the Great Firewall. The webinar will also provide insights on overcoming common performance challenges and fulfilling Chinese regulatory requirements mandated by the Ministry of Industry and Information Technology (MIIT) and the China Internet Network Information Center (CNNIC).

1. Demystifying China Online
Reaching China with Your Website
and Cloud Applications
Presented by Sponsored by: Featuring:

2. The Opportunities
Opportunities

3. China is home to the world’s largest online
population

4. © 2013 Forrester Research, Inc. Reproduction Prohibited
By 2015 more than 700 million Chinese will have regular
access to the internet

5. © 2014 Forrester Research, Inc. Reproduction Prohibited 5
The numbers in China far exceed those of other mature
eCom markets

6. There are more internet users in China than there are
people in the US

7. © 2013 Forrester Research, Inc. Reproduction Prohibited
Similar to other markets with high internet penetration, the
online population in China is very social on the internet

8. • Beijing
• Chengdu
• Dalian
• Guangzhou
• Nanjing
• Ningbo
• Shanghai
• Shenyang
• Suzhou
• Wuhan
• Wuxi
• Xian
Metro China cities surveyed:
The majority of the population has access to the
internet - and uses it

9. © 2013 Forrester Research, Inc. Reproduction Prohibited
Online shopping behavior in China is unprecedented
for an emerging market

10. Projected Online Retail Sales For 2013 And 2017:
The US And China Lead eCommerce

11. Forecast: Online Retail Spending In China (B2C
And C2C), 2012 To 2018

12. © 2013 Forrester Research, Inc. Reproduction Prohibited
eCommerce Readiness Index Ranks China as #2

13. © 2013 Forrester Research, Inc. Reproduction Prohibited
Mobile is a key touch point

14. Challenges

15. Forrester’s clients say about doing business in China…
Operational challenges are
not intuitive
Laws/regulations are difficult
to navigate and constantly
evolving
Local expertise is difficult to
acquire
You need local relationship
to survive
China needs to be treated as a
separate entity – not as an
expansion of existing
business

16. The “Great Firewall of China” creates unique problems
› Router blocks:
• 97% of international routers are blocked
• 3% of internal routers are blocked
› Preferential treatment from agency to agency
• Grounds for blocking are inconsistent and subjective
• Some blocks are temporary or due to internal agency mistakes
› All domains are subject to being blocked
• Over 2,500 foreign domains are blocked in China – including some of the biggest and
most used in the U.S. including Facebook and Twitter
› Lag in load time
• Loading a non-Chinese hosted webpage takes an additional 10-15 seconds when
accessed in China

17. © 2013 Forrester Research, Inc. Reproduction Prohibited
17
Response time in China is far slower than that in
other markets

18. © 2014 Forrester Research, Inc. Reproduction Prohibited 18
Online consumers prefer link saturated sites

19. Web content hosted outside of China often has
performance challenges
TCP/IP round
trip time
Http round
trip time (for
a single
object)
Firewall
filtering
Response
time for a
single object
Response
time for a
typical web
page
Between
China and
US/Europe
(measured
on a single
object)
600MS
2,000 –
3,000 MS
450 MS ~3 seconds
20-30
seconds
Your users in
China will feel the
pain!

20. Southern China:
Telecom territory
Northern China:
Unicom territory
The great divide between the north and the south …

21. Source: China Internet Network Information Center (CNNIC)
Nearly 50% of internet users in China are in rural areas where the internet
connection is unreliable and processing times are extremely slow

22. Licensing requirements can be a barrier to entry when
hosting a website in China
› Beian (Record Bureau) & Gongan (Public Security Bureau) Licenses
• Required for all websites hosted and delivering from within the Great Firewall
› Internet Content Provider (ICP) License
• Required for all websites with a shopping cart
› Additional licenses may be required for:
• Education
• Healthcare
• News/media
• Pharmaceutical

24. In the case of Uniqlo, the holding company and the
flagship site also had to be registered on the ICP license

25. Some content is easier to host in China than others
Content Type Likelihood to be blocked
Adult/pornography Forbidden
Gambling Forbidden
Political Forbidden
Anti-government Forbidden
Religious High
User-generated (SNS, BBS, blog, sharing) High
News High
Gaming Medium
Entertainment Medium
Software Low
Enterprise Low
e-Commerce Low

26. Option #1: Move content closer to the greater China area
Hong Kong and
Singapore are two
common hosting
locations

27. Content distribution speeds with content closer to China
Http round trip
time (for a single
object)
Firewall filtering
Total delay (for a
single object)
With direct
peering
connection to all
three major ISPs
in mainland
100 MS 450 MS 550 MS
No direct peering
connection
300 MS 450 MS 700 – 800 MS
The limiting factor
with this option is
poor connectivity and
firewall filtering

28. Challenges with hosting close to China, but outside of
China
› Choosing a hosting provider can be tricky
› The great firewall blocks IP
› Sites hosted on the same server (or same IP block)
as questionable content will also be blocked

29. Option #2:Host content in Mainland China

30. Southern China:
Telecom territory
Northern China:
Unicom territory
The great divide between the north and the south
requires mirrored sites
The sparse bandwidth between the south
and the north means you need mirrored
sites in both territories

31. Setting up websites in China is a complex operation
› Businesses must apply for a government-issued
license - licenses vary for each type of site
› The rules for obtaining licenses are confusing
and procedures unclear
› Rules and regulations for obtaining a license
change frequently
› Licenses takes longer to acquire and are under
more scrutiny for western brands
› Local operation requirements

32. Option #3: Hosting externally with a CDN within China
Geographic
coverage is key

33. Using a CDN significantly reduces delivery time
Don’t do
anything
Hosting close to
China
Hosting in China
With CDN
acceleration
User
performance
3 seconds (for a
single object)
450 MS 10 – 300 MS 30 MS
Efforts involved
Easy Medium:
Finding a good
hosting provider
can be
challenging
High: Business
must do
everything.
Finding a
hosting provider,
applying for
licenses and
keeping up with
regulations
Easy to
Medium: CDN
partner manages
licenses and
regulations
ROI Time
Frame
N/A – will see
little incremental
growth
Slow Medium Fast

34. Criteria to choosing a CDN partner in China
› Local coverage
• Being able to deal with the north-south divide
• Deliver good performance all over China
› Local know-how and expertise
• Knowing how to deal with the evolving regulation landscape in China
• Manage regulatory compliance for you
› Local relationships
• Good relationship with local ISPs and network peering points

35. Criteria to choosing a right CDN partner in China
› Global operations
• The ability to deliver content in and out of China
› Global know-how
• A mature business that knows how to do business with multi-national companies
› Global management
• Let you have a global understanding of how your web content is being delivered
› Mobile optimization
• Help optimize the payload sent over the network by compressing images and
page structure based on current network conditions (e.g., 3G versus 4G), thus
helping the slow lane go as fast as possible.

36. Global Content Delivery Network
• Accelerating over 40,000 sites across 140+ PoPs around the globe
• Only Global CDN with a presence inside of Mainland China (25 PoPs)
• Integrated solutions: Performance, Security and Scalability
• Industry leaders in reaching emerging markets

37. Great Firewall – Slower Websites
40% slower
download time
64kB object downloaded from
Test agents inside of China
• Guangzhou (inside China)
• Hong Kong (outside China)
Source: NetworkBench results, Sep. 2012

38. Distance = Latency
Downloadtime(sec)
0
10
20
30
40
50
60
70
80
London
Paris
Geneva
Frankfurt
Oslo
Madrid
Milan
Istanbul
NewYork
NewDelhi
LosAngeles
SaoPaulo
Tokyo
Sydney
Seoul
KualaLumpur
BuenosAires
Taipei
Chengdu
HongKong
Beijing
Guangzhou
Singapore
Xian
Site performance degrades as distance increases
Source: Source: CDNetworks network monitoring POP latencies, 2012

39. Also found increasing load time of
the page from 400ms to 900ms –
led to 25% reduction in traffic
Why Does it All Matter?
Faster Sites Perform Better
Found a 100ms of delay
reduced revenue by 1%
Found that speeding up their
website by 5 seconds increased
their conversion rates by 7-12%
and doubled # of visitors from
search engine traffic
0
10
20
30
40
50
60
70
80
90
100
TBs
Social Gaming Customer
Go-Live: Feb. 2012
3.7x traffic in 6 months
Source: Source: CDNetworks Performance Monitoring, 2012

40. The Options…
Add more Datacenters
• Attempt to get close to end-users
• Expensive
• Complex
• Sync problem
• Doesn’t solve performance issue
1
HW Appliances
• Expensive
• Need IT team
• No support for remote
end users
2
Traditional CDN
• Only focused on caching
• Doesn’t support client-server
apps
3
ADCWOC
WOC
Cache
Cacheable
Non-cacheable

41. Get Faster and More Reliable
Web Performance in China

42. CDNetworks Presence In China
25 Points of Presence (PoPs)
In-Country Experts
• Content
• Licensing
• Regulations
End to End Reach
• Bypass unstable peering
between local ISPs
Superior Performance
• Speed, Security and Reliability

43. China Acceleration
• Creates a ‘Fast Secure Tunnel’ over the Internet
• Quickly deliver websites & applications globally to and from China
• No CAPEX for Hardware / Software
• In-country experts – licensing requirements, regulations, & monitoring
• Fully integrated and managed services

44. China Acceleration

45. Result:
Bally Reduces Load Time By 81%
Improving Online Shopping Experience in China
Opportunity:
27% of all luxury goods are consumed by Chinese Shoppers.
By 2015, they will account for 35% of all luxury goods sold.
Challenges
Bally launches bally.cn in 2011:
• Required optimization to comply with local regulations
• Rich media resulted in poor web performance
• Spotty in-country peering increased website latency

46. 末(end)
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