38th China Internet Development Status Report

China Internet Development Status Report
2016
(Original Report Published in July 2016)
Original Publisher:
Translated by:
Zheng Yao

China Internet Development Status Report 2016
Translated by Zheng Yao
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Preface to the Original
In 1997, the China Internet Network Information Center (CNNIC) were appointed to lead the monitoring
efforts on China’s internet. Beginning from 1997, CNNIC has successfully published 37 reports on the
development status of China’s internet, this is the 38th
report. These CNNIC reports have testified all
stages of development of China’s internet from the beginning. With access to the rigorous and objective
data provided with this report, relevant governmental departments, as well as industry and other
parties will able to appreciate the developmental status of China’s internet. Our reports have provided
support for policy setting, received attention from multiple parties, and is being referenced both inside
and outside of China.
Since 1998, China Internet Network Information Center has been publishing the “China Internet
Development Status Report” in January and July of each year. In the first six months of 2016, with
internet playing an increasingly important role in economic, cultural, and social activities, the
importance of internet has reached unprecedented levels. As an observer to China’s internet
development, CNNIC has increased the depth and breadth of reporting activities. The main body of this
38th
report consists of two sections: Basic Resources and Personal Applications. The Basic Resources
section introduces the development status of the basic network resources in China; the Personal
Applications section introduces web user population size and structure, internet usage environment,
and the development status of personal internet applications. Through the above sections, we aim to
accurately and objectively reflect the role of the internet in social development.

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Report Summary
Section One: Basic Data
 As of June 2016, China internet user population has reached 710 million, an increase of 21.32
million from the previous six month. Internet adoption rate is 51.7%, an increase of 1.3
percentage points from 2015.
 As of June 2016, China mobile internet user population has reached 656 million, an increase of
36.56 million from 2015. The percentage of internet users using a mobile phone to access the
internet has increased from 90.1% at the end of 2015 to 92.5%.
 As of June 2016, 26.9% of internet users are rural, totaling 191 million.
 As of June 2016, 92.5% of internet users use mobile phone to access the internet, a 2.4
percentage point increase from 2015; percentages of users accessing the internet via a desktop
or a laptop are 64.6% and 38.5% respectively; 30.6% of users also access the internet through a
tablet, and 21.1% access the internet via a TV.
 As of June 2016, there are 36.98 million domain names registered in China, of which 19.50
million are “.cn” domains (52.7%). There were 0.5 million “.中国” domain names.
 As of June 2016, China has 4.54 million websites, of which 2.12 million are “.cn” sites.
Section Two: Characteristics of Personal Applications
Internet User Population exceeds 700 million, Internet Adoption Rate Rises Steadily
As of June 2016, China’s internet user population has reached 710 million. There were 21.32 million
new users in the first six months of 2016, an increase of 3.1%. Internet adoption rate is 51.7%, an
increase of 1.3 percentage points from 2015, 3.1 percentage points higher than the global average.
Mobile Internet Users has Reached 656 Million, Strengthening the Leadership Mobile
As of June 2016, China mobile internet user population has reached 656 million, an increase of 36.56
million from 2015. The percentage of internet users using a mobile phone to access the internet has
risen to 92.5% from 90.1% at the end of 2015. 24.5% of internet users in China are mobile only.
Internet access devices are increasingly concentrated towards mobile. With continued infrastructure
investments in mobile communication networks, and increasing adoption of smart phones, mobile
internet applications are permeating into the daily routines of users, bringing an increase in mobile
internet usage.
Rural Internet Adoption Rate Stable, Difference between Rural and Urbanized Areas still
Significant
The rural internet adoption rate was stable, at 31.7% as of June 2016, 35.6 percentage points lower
than urbanized areas. “Don’t know how to use the internet”, “don’t want to be on the internet” are
the major road blocks for rural residents to internet usage. 68% of rural non-internet-users claim
they “don’t understand computer/the internet” as their reason for not using the internet, 10.9%
claim “there is no need/not interested” in using the internet.

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Offline Usage Scenarios for Online Payment Methods Continue to Enrich, Online Investment and
Asset Management Behaviors Gradually Taking Hold
The growth of internet finance adoption has continued in the first six months of 2016. The internet
payment, online investment user population has grown by 9.3% and 12.3% respectively. With the
fast development of e-commerce, online payment service providers continue to create
opportunities for users to conduct offline payments, with the implementation of all forms of social
related marketing strategies, bring about user conversion to online payments; the number of users
managing their asset over the internet continues to grow. As the choice of asset management
products increases, with improved user experience, online asset management behavior in the
general population is taking hold.
Internet is Accelerating Public Services, Including Online Education and Online Governmental
Services
For the first six months of 2016, all types of public internet services have shown an increase in user
adoption. Online education, online hailing for transport, online governmental services have all seen
their user populations exceeding 100 million. Diversification and mobile first has continued to be the
theme of development. The online education market has continued to diversify into fine-grained
market segments, with expanding user boundaries. Mobile education offers opportunities to
personalize the educational experience, and to integrate touch, sound and voice into the
educational experience. Hence mobile is fast becoming mainstream for online education. Online car
hailing services: due to strong market demand, and increasing technological sophistication, market
size is continuing to expand. Online governmental services: government websites and Weibo,
WeChat Official Accounts, and client applications, are improving user experience for governmental
services.

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目录
Basic Resources Section ...............................................................................................................................8
Chapter One: Basic Network Resources in China June 2016........................................................................9
China Internet Basic Network Resources Overview .................................................................................9
IP Address Quantity Allocated to China....................................................................................................9
Domain Names Registered within China ................................................................................................10
Personal Applications Section....................................................................................................................13
Chapter Two: Internet User Population and Structure China June 2016 ...................................................14
Internet Population Size in China............................................................................................................14
I. Population Overview...................................................................................................................14
II. Mobile User Population ..............................................................................................................14
III. Rural Internet User Population...............................................................................................15
Internet User Demographics...................................................................................................................16
I. Gender ........................................................................................................................................16
II. Age ..............................................................................................................................................16
III. Educational Level ....................................................................................................................17
IV. Occupational Structure...........................................................................................................17
V. Income Structure ........................................................................................................................18
Chapter Three: Internet Usage Environment in China June 2016..............................................................20
1. Client Device ...................................................................................................................................20
2. Location of Internet Access.............................................................................................................20
3. Type of Network: Wifi vs. 3G/4G ....................................................................................................21
4. Weekly Time Online........................................................................................................................21
Chapter Four: Developmental Status of Personal Internet Applications ...................................................22
1. Development of Basic Applications ................................................................................................24
I. Instant Messaging.......................................................................................................................24
II. Search Engine..............................................................................................................................24
III. Internet News .........................................................................................................................24
IV. Social Applications ..................................................................................................................25
2. Business Transaction Apps..............................................................................................................26
I. Online Shopping..........................................................................................................................26
II. Online Meal Ordering .................................................................................................................26

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III. Travel Booking.........................................................................................................................26
3. Internet Finance Apps.....................................................................................................................26
I. Asset Management.....................................................................................................................26
II. Online Payment...........................................................................................................................27
4. Online Entertainment .....................................................................................................................27
I. Online Games..............................................................................................................................27
II. Online Literature.........................................................................................................................28
III. Online Video............................................................................................................................28
IV. Online Music ...........................................................................................................................29
V. Live Broadcasting........................................................................................................................30
5. Public Service Applications .............................................................................................................31
I. Online Education.........................................................................................................................31
II. Car Hailing...................................................................................................................................31
III. Online Governmental Services................................................................................................31

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Figure 1 Block /32 of IPv6 Adresses in China, 2010.6-2016.6.....................................................................10
Figure 2 Total Number of IPv4 Addresses in China, 2010.6-2016.6 ...........................................................10
Figure 3 China Domain Name Count by Top-Level Domain, 2016.6...........................................................11
Figure 4 Distribution of .cn Domain Names, 2016.6...................................................................................11
Figure 5 China Website Quantity (million), 2011.6-2016.6 (excluding sites under .edu.cn)......................12
Figure 6 China International Bandwidth and Grow Rate, 2013.6-2016.6...................................................12
Figure 7 China Internet User Population and Growth Rate, 2012.6-2016.6...............................................14
Figure 8 China Mobile User Population and Adoption by Internet Users, 2012.6-2016.6.........................15
Figure 9 China Rural and Urban Internet Adoption Rates, 2014.6-2016.6.................................................16
Figure 10 China Internet User Age Demographic Breakdown, 2015.12-2016.6.........................................17
Figure 11 China User Education Level, 2015.12-2016.6 .............................................................................17
Figure 12 Occupational Structure of China's Internet Users ......................................................................18
Figure 13 China Internet User Monthly Income Distribution .....................................................................19
Figure 14 Devices Used to Access the Internet in China.............................................................................20
Figure 15 Location of Internet Access through a Computer, China............................................................21
Figure 16 Average Weekly Time Online, China 2012.6-2016.6 ..................................................................22
Figure 17 Adoption Rates of Typical Social Apps, China 2015.12-2016.6...................................................25
Figure 18 Adoption Rates of Live Broadcasting Services among Internet Users in China June 2016.........30
Figure 19 Adoption Rates of Governmental Services, China 2016 .............................................................32

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Basic Resources Section

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Chapter One: Basic Network Resources in China June 2016
China Internet Basic Network Resources Overview
As of June 2016, there are 338 million IPv4 addresses in China, and 20781 block of IPv6 addresses (/32,
or 296
addresses).
China has 36.98 million domain names, of which there are 19.5 million ‘.cn’ domains, a growth of 19.2%
from the previous six months, taking up 52.7% of all domain names registered in China.
China has 4.54 million websites, an increase of 7.4% over the previous six months; there are 2.12 million
‘.cn’ sites.
China’s international bandwidth is at 6,220,764 Mbps, an increase of 15.4% over the previous six
months.
Table 1 2015.12 - 2016.6 China Basic Network Resources
Dec-15 Jun-16 Half-year Growth
Rate
IPv4 336,519,680 337,608,448 0.30%
IPv6 (blocks) 20,594 20,781 0.90%
Total Domain Names 31,020,514 36,984,009 19.20%
.cn Domains 16,363,594 19,502,493 19.20%
Websites 4,229,293 4,542,406 7.40%
.cn Sites 2,130,791 2,124,416 -0.30%
International
Bandwidth
5,392,116 6,220,764 15.40%
IP Address Quantity Allocated to China
As of June 2016, China has 20781 blocks of IPv6 address, with each block at /32 (or 296
addresses), an
increase of 0.9% over the half year.

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Figure 1 Block /32 of IPv6 Adresses in China, 2010.6-2016.6
Global IPv4 addresses has been fully assigned as of February 2011, and starting from 2011, China’s total
number of IPv4 addresses or stay more or less the same. As of June 2016, China has 337.61 million IPv4
addresses.
Figure 2 Total Number of IPv4 Addresses in China, 2010.6-2016.6
Domain Names Registered within China
As of June 2016, there were 36.98 million China registered domain names, a growth of 19.2% from the
previous six month.
0
5,000
10,000
15,000
20,000
25,000
Block /32 of IPv6 Adresses in China
0
5,000
10,000
15,000
20,000
25,000
30,000
35,000
40,000
Total Number of IPv4 Addresses in China

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Figure 3 China Domain Name Count by Top-Level Domain, 2016.6
As of June 2016, there were 19.50 million ‘.cn’ domains, an increase of 19.2% from the previous six
months, constituting 52.7% of all domain names registered in China; there were 10.94 million ‘.com’
domain names registered in China, constituting 29.6%; there were 0.5 million ‘.中国’ domain names.
Figure 4 Distribution between different .cn Domain, 2016.6
Websites
As of June 2016, there were 4.54 million websites in China, growing by 7.4% over the previous six
months.
0%
10%
20%
30%
40%
50%
60%
cn com net org 中国 biz info Other
China Domain Name Count by Top-Level Domain
0.00%
10.00%
20.00%
30.00%
40.00%
50.00%
60.00%
70.00%
80.00%
.cn com.cn adm.cn net.cn org.cn gov.cn edu.cn mil.cn
Distribution of .cn Domain Names

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Figure 5 China Website Quantity (million), 2011.6-2016.6 (excluding sites under .edu.cn)
International Bandwidth
As of June 2016, China’s international bandwidth is at 6,220,764 Mbps, an increase of 15.4% over the
previous six months.
Figure 6 China International Bandwidth and Grow Rate, 2013.6-2016.6
0
0.5
1
1.5
2
2.5
3
3.5
4
4.5
5
China Website Quantity (million)
0.00%
10.00%
20.00%
30.00%
40.00%
50.00%
60.00%
70.00%
0
1000
2000
3000
4000
5000
6000
7000
2013.6 2013.12 2014.6 2014.12 2015.6 2015.12 2016.6
China International Bandwidth and Grow Rate
Bandwidth Gbps Growth Rate

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Personal Applications Section

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Chapter Two: Internet User Population and Structure China June 2016
Internet Population Size in China
I. Population Overview
As of June 2016, China internet user population has reached 710 million, an increase of 21.32 million
from the previous six month. Internet adoption rate is 51.7%, an increase of 1.3 percentage points from
2015.
Figure 7 China Internet User Population and Growth Rate, 2012.6-2016.6
With continued improvement in internet infrastructure, implementation of favorable policies, and
internet permeating all industries, the internet user population has continued to increase. The internet
will continue to have deep influences on China’s political, economic, cultural and social activities.
II. Mobile User Population
As of June 2016, China mobile internet user population has reached 656 million, an increase of 36.56
million from 2015. The percentage of internet users using a mobile phone to access the internet has
increased from 90.1% at the end of 2015 to 92.5%, mobile is now the dominant device for accessing the
internet. There are now 173 million mobile only internet users, constituting 24.5% of all internet users.
0%
10%
20%
30%
40%
50%
60%
0
100
200
300
400
500
600
700
800
2012.6 2012.12 2013.6 2013.12 2014.6 2014.12 2015.6 2015.12 2016.6
China Internet User Population and
Adoption Rate
Population (million) Adoption by the General Population (%)

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Figure 8 China Mobile User Population and Adoption by Internet Users, 2012.6-2016.6
Strong growth of mobile first internet users and conversion from computer users to the mobile internet
has brought about continued increase in mobile internet user population. The convenience of the
mobile device has lowered the hurdle for internet access. In the first six months of 2016, 13.01 million of
China’s new internet users were mobile, 61.0% of the total increase in new users. Mobile internet
service applications are becoming increasingly abundant, and increasingly relevant to user’s life, work,
as well as consumption of products and services, and entertainment, forced the continued migration of
computer internet users to mobile. In the first six months of 2016, 23.55 million of new mobile internet
users came from existing computer internet users, an increase of 12.02 million compared to 2015.
III. Rural Internet User Population
As of June 2016, 26.9% of internet users are rural, totaling 191 million; 73.1% of internet users are from
urbanized areas, totaling 519 million, adding 25.71 million compared to 2015, an increase of 5.2%.
Rural internet adoption rate is stable, as of June 2016, is at 31.7%. However, internet adoption rate in
urbanized areas exceed those in rural areas by 35.6 percentage points, the difference between rural and
urban adoption is still very significant.
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
0
100
200
300
400
500
600
700
2012.6 2012.12 2013.6 2013.12 2014.6 2014.12 2015.6 2015.12 2016.6
China Mobile User Population and Adoption Rate
Population (million) Adoption by Internet Users (%)

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Figure 9 China Rural and Urban Internet Adoption Rates, 2014.6-2016.6
Lack of awareness or knowledge on the internet leading to weakened desire in internet usage, is the
main reason behind the low rural adoption rates. Based on CNNIC survey feedback, the main reason
claimed by rural residents for not using the internet is ‘don’t know computer/internet’, at 68.0%; the
No.2 reason is ‘too old/too young to use’, at 14.8%; ‘no need/not interested’ is the No.3 reason, at
10.9%.
Internet User Demographics
I. Gender
As of June 2016, China internet user gender ratio is 53 Male: 47 Female, at the same time, the overall
population gender ratio in China is 51.2: 48.8. The internet user population is gender balanced.
II. Age
As of June 2016, most of internet users in China is between 10 and 39 years old, constituting 74.7% of
the total user population. Within this age group, the proportion of users aged 20-29 is highest, at 30.4%,
10-19, and 30-39 age groups are respectively 20.1% and 24.2% of the total population. Compared to
2015, the proportion of users under 10 or over 40 has increased.
0%
20%
40%
60%
80%
100%
120%
2014.6 2014.12 2015.6 2015.12 2016.6
China Rural and Urban Internet Adoption Rates
Rural Urban

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Figure 10 China Internet User Age Demographic Breakdown, 2015.12-2016.6
III. Educational Level
As of June 2016, the majority of China internet users have medium level of education.
Figure 11 China User Education Level, 2015.12-2016.6
IV. Occupational Structure
As of June 2016, students forms the majority of China’s internet user population, constituting 25.1%; the
next segment is freelancer small business owner, at 21.1%; company employees constitutes 13.1%.
Segment proportions stable compared to the end of 2015.
0%
5%
10%
15%
20%
25%
30%
35%
Under 10 10-19 20-29 30-39 40-49 50-59 Above 60
Internet User Age Demographics
2015.12 2016.6
0%
5%
10%
15%
20%
25%
30%
35%
40%
Primary School
or Less
Secondary
School
High School or
Vocational
Vocational
University
Graduate or
Above
China User Education Level
2015.12 2016.6

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Figure 12 Occupational Structure of China's Internet Users
V. Income Structure
As of June 2016, the majority of China’s internet users have incomes falling within the 2001-3000
(16.2%), and 3001-5000 (22.7%) income groups. With continued economic development, the income of
internet users is increasing. Compared to the end of 2015, users with incomes above 5000 RMB has
increased by 3.8 percentage points.
0% 5% 10% 15% 20% 25% 30%
Student
Public Sector Management
Public Sector Employee
Company Top Level Management
Company Mid-Level Management
Company Employee
Technical Professionals
Business Services Professionals
Factory Workers
Freelancers
Migrant Workers
Farm, Forestory, Livestock & Fishery
Retired
Unemployed
Other
Occupational Structure of China's Internet Users
2016.6 2015.12

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Figure 13 China Internet User Monthly Income Distribution
0% 5% 10% 15% 20% 25%
None
< 500
501-1000
1001-1500
1501-2000
2001-3000
3001-5000
5001-8000
> 8000
Income Distribution of China Internet Users
2016.6 2015.12

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Chapter Three: Internet Usage Environment in China June 2016
1. Client Device
In the first six months of 2016, users accessing the internet through a mobile phone or a TV has
increased significantly. As of June 2016, the proportion of internet users accessing the net with a mobile
phone has risen to 92.5%, an increase of 2.4 percentage points compared to 2015; with fast adoption of
smart TVs, TV is becoming the center of entertainment at home. 21.1% of China’s internet users use
their TV to access content over the internet, an increase of 3.2 percentage points from 2015 levels. In
the same period, 64.6% of users are using desktop, 38.5% laptop, and 30.6% tablet to access the
internet, and are 3.1, 0.2 and 0.9 percentage points lower respectively compared to 2015.
Figure 14 Devices Used to Access the Internet in China
2. Location of Internet Access
As of June 2016, 87.7% of China internet users access the internet at their home through a computer, a
decrease of 2.6 percentage points from the end of 2015. Small increases are seen for users accessing the
internet through a computer at work, at school, or at internet cafes. However, overall rates of internet
access via a computer at a public place decreased slightly to 17.3%.
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Desktop Laptop Mobile TV Tablet
Devices Used to Access the Internet
2015.12 2016.6

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Figure 15 Location of Internet Access through a Computer, China
3. Type of Network: Wifi vs. 3G/4G
As of June 2016, 91.7% of mobile internet users in China are using a 3G/4G network, an increase of 2.9
percentage points from 2015. Data sharing, data rollover, and reduced rates for out of province data
usage, have encouraged greater consumption of mobile data.
As of June 2016, 92.7% of internet users have used Wi-Fi, an increase of 0.9 percentage points from
2015. Accelerated deployment of Wi-Fi network at home, at work, and at public places, along with
increased adoption of mobile, tablet, and smart TVs have pushed for the development of Wi-Fi
networks.
4. Weekly Time Online
In the first six months of 2016, average weekly time online for China internet users is 26.5 hours, an
increase of 0.3 hours from 2015.
0%
20%
40%
60%
80%
100%
Home Net Café Work School Public Place
Location of Internet Access through a
Computer
2015.12 2016.6
0
5
10
15
20
25
30
2012.6 2012.12 2013.6 2013.12 2014.6 2014.12 2015.6 2015.12 2016.6
Average Weekly Time Online (hrs)

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Figure 16 Average Weekly Time Online, China 2012.6-2016.6
Chapter Four: Developmental Status of Personal Internet Applications
In the first half of 2016, China personal internet applications developed steadily. Users for all services
except for internet games and public bulletin boards have increased: meal ordering and online
investment management have shown the greatest increases (half-year increases of 31.8% and 12.3%
respectively). Online shopping has also seen fast growth, grown 8.3% over the six months. The majority
of mobile apps have seen increased usage. Mobile meal ordering has seen the greatest increase, by
40.5%. Mobile internet payment, and mobile shopping have all grown by nearly 20%.
Users for Basic Applications Increased Steadily, Diverse Services are being offered
Instant messaging, search engine, and news are the basic applications of the internet, with adoption
rate of each above 80%. Instant messaging products are extending into online and offline services.
Transactional Apps Continue to Grow, Policy and Monitoring Continue to Improve
In the first six months of 2016, adoption of business transactional apps have continued. Online shopping
and travel booking users have grown by 8.3% and 1.6% respectively. Online meal ordering is in the early
stages of development. The local logistics service network built from fulfilling meal orders can be
adapted to ‘short distance logistics’ and be extended to service offerings on other life enhancing short
distance services. Online travel booking services have also seen fast growth, supported by tourism
spending from Chinese residents.
Offline Usage Scenarios for Online Payment Methods Continue to Enrich, Online Investment and Asset
Management Behaviors Gradually Taking Hold
The growth of internet finance adoption has continued in the first six months of 2016. Online payment,
and online asset management user populations have grown by 9.3% and 12.3% respectively from the
end of 2015. Leveraging fast development of e-commerce, online payment service providers continue to
expand offline by creating opportunities for in store offline payments. Social engagement strategies
have also been implemented to convert the friend of existing users to online payment services. With
increasing number of asset management products available and improved user experience across the
products being offered, online asset management behavior in the general population is seeing adoption.
Online Entertainment Apps show steady increase in adoption, Copyright Protection is also improving
In the first six months of 2016, online entertainment apps has continued their migration to mobile,
mobile music, video, games, and literature all have user growth rates above 6%. A greater proportion of
the online content now have the proper Copyrights. Pirated content is now being discontinued by online
services. Online video content is leveraging quality and differentiation to culture paying for video
behavior. Online music platforms are expanding their market overseas, while creating a chain of novel
opportunities to include live shows and fan engagement activities to increase their competitiveness.
Online live broadcasting, being a novel application, has seen strong adoption; with strategic positioning
by established internet companies, competition is intensifying.

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Internet is Accelerating Public Services, Including Online Education and Online Governmental Services
For the first six months of 2016, all types of public internet services have shown an increase in user
adoption. Online education, online hailing for transport, online governmental services have all seen their
user population exceeding 100 million. Diversification and mobile first has continued to be the theme of
development. The online education market has continued to diversify into fine-grained market
segments, with expanding user boundaries. Mobile education offers opportunities to personalize the
educational experience, by integrating touch, sound and voice. Hence mobile is fast becoming
mainstream for online education. Online car hailing services, due to strong market demand, and
sophistication in technology, market size is continuing to expand; online governmental services,
including government websites, Weibo, WeChat Official Accounts, and software applications, are
optimizing user experience for governmental services.
2016.6 2015.2
App User
(million)
Adoption
Rate
User (million) Adoption Rate Six Month Growth
Rate
Instant
Messaging
641.77 90.40% 624.08 90.70% 2.80%
Search 592.58 83.50% 566.23 82.30% 4.70%
News 579.27 81.60% 564.4 82.00% 2.60%
Video 513.91 72.40% 503.91 73.20% 2.00%
Music 502.14 70.80% 501.37 72.80% 0.20%
Payment 454.76 64.10% 416.18 60.50% 9.30%
Shopping 447.72 63.10% 413.25 60.00% 8.30%
Games 391.08 55.10% 391.48 56.90% -0.10%
Banking 340.57 48.00% 336.39 48.90% 1.20%
Literature 307.59 43.30% 296.74 43.10% 3.70%
Travel 263.61 37.10% 259.55 37.70% 1.60%
Email 261.43 36.80% 258.47 37.60% 1.10%
Meal Ordering 149.66 21.10% 113.56 16.50% 31.80%
Education 117.89 16.60% 110.14 16.00% 7.00%
Bulletin Boards 108.12 15.20% 119.01 17.30% -9.10%
Asset
Management
101.4 14.30% 90.26 13.10% 12.30%
Stock & Funds 61.43 8.70% 58.92 8.60% 4.30%
Live
Broadcasting
324.76 45.80%

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1. Development of Basic Applications
I. Instant Messaging
As of June 2016, instant messaging user level reaches 642 million, an increase of 17.69 million
from the end of 2015, and 90.4% of all internet users use this service. Mobile instant messaging
users reaches 603 million, an increase of 46.27 million from the end of 2015, constituting 91.9%
of all mobile users.
The increase in instant messaging users has plateaued, core function and market share are now
relatively stable. Instant messaging is extending into payment, e-commerce, and other offline
services. The red envelope function pushed out by WeChat during Spring Festivals cultured
payment behavior from instant messaging users.
Due to slow user growth, app differentiation has become the focus for instant messaging apps in
2016. WeChat and QQ have differentiated themselves to focus on different age groups; Momo
on stranger socialization, Aliwangwang on buyer seller communication, and YY Voice on online
gaming.
Enterprise instant messaging has come into the focus of BAT (Baidu, Alibaba, Tencent) in China
over 2016, and competition is intensifying. Integrating employee ownership of mobile into
corporate workflows to meet communication needs has the potential to greatly increase
operational efficiency.
II. Search Engine
As of June 2016, China search engine user has reached 593 million, at 83.5% adoption rate. This
is an increase of 26.35 million or 4.7% from the end of 2015. Mobile search user has reached
524 million, at 79.8% adoption rate, an increase of 46.25 million or 9.7% from 2015. Search
engine is currently the No.2 application in China.
Trends seen in China’s search engine market over the first six months of 2016:
1. Artificial intelligence shows greater adoption, voice, photo and video search is increasingly
accurate.
2. Abundant choice of mobile applications has reduced the need for mobile search, with
reduced sales conversion rates.
3. Search is becoming regulated. In June 2016, the “Regulation on Internet Information
Services” has been published by the National Office of Internet Information. The scope of
internet search service has been defined for the first time.
III. Internet News
As of June 2016, internet news readers in China has reached 579 million, 81.6% of all internet
users, an increase of 14.87 million, or 2.6% from 2015. There are 518 million mobile internet
users, or 78.9% of all internet users, an increase of 36.35 million or 7.5% from 2015.

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Mobile has become the major channel of news consumption for China’ internet users. With
increasing adoption of the mobile internet, expansion of content, and fragmentation of user
attention, user desire for personalized, vertically integrated news services is up. In the first six
months of 2016, the following observations are made in terms of the publication format and
developmental trend of news services:
Differential exposure of content, based on user interest, is being adopted. Compared to the
traditional publish to all method, differential publishing has increased content distribution
efficiency.
Traditional media, such as People’s Daily and China Central Television, are migrating to the
mobile internet.
IV. Social Applications
Social, no longer limited to messaging, has become a basic internet functionality that can quickly
spread information.
WeChat Moments, QQ Zone are all social applications developed from instant messaging. As of
June 2016, adoption rates are 78.7% and 67.4% respectively. WeChat Moments is a social
platform developed from existing contacts. With increasing user adoption however, weaker
relations gradually permeates into WeChat and is forming parallel, self-sustaining groups within
WeChat. QQ Zone also simultaneously hosts strong and weak relationships, with most of the
content produced by individuals rather than Official Accounts as is the case for WeChat. Hence
the media factor is weaker for QQ Zone.
Weibo’s current strategy focuses on vertically integrated ecosystem of content producers and
their followers, is primarily a media service. As of June 2016, there were 242 million Weibo
users, adoption rate is at 34%, a slight increase from 2015 levels.
Figure 17 Adoption Rates of Typical Social Apps, China 2015.12-2016.6
0% 10% 20% 30% 40% 50% 60% 70% 80% 90%
WeChat
QQ Zone
Weibo
pengyou.com
renren.com
douban.com
Adoption Rates of Typical Social Apps
2015.12 2016.6

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2. Business Transaction Apps
I. Online Shopping
As of June 2016, there were 448 million online shoppers in China, an increase of 34.48 million or
8.3% from the end of 2015. Online shopping in China is undergoing fast and stable growth.
There were 401 million mobile online shoppers in China, an increase of 18.0% from the end of
2015. Adoption of mobile online shopping has grown from 54.8% to 61.0%.
The Chinese government and regulators have encouraged innovation in online shopping. Tax
breaks were given to certain products imported via e-commerce. Two sets of regulations
published in 2016 provide support in e-commerce importing: “Taxation Policies on Cross
Broader E-Commerce Importing” (March 2016) and “List of Products Classified as Retail E-
Commerce Imports” (April 2016).
On e-commerce in rural areas, Alibaba and local governments have encouraged rural residents
to buy and sell through e-commerce.
II. Online Meal Ordering
As of June 2016, 150 million users have been ordering meals online, an increase of 36.10 million
or 31.8%. Mobile users of meal ordering has reached 146 million, an increase of 40.5%.
Adoption rate of mobile meal ordering has increased from 16.8% to 22.3%.
Meal ordering is undergoing fast development right now.
III. Travel Booking
As of June 2016, 264 million users in China have booked flight (14.4% of total internet users),
hotel (15.5%), train (28.9%) or holiday products (6.1%) online, an increase of 4.06 million or
1.6% from the end of 2015. 35.4% of China’s internet users use mobile to make the bookings.
The travel booking market in China is now intensely competitive because:
 Direct online sales by airlines;
 Royalties on bookings has forced hotel chains into direct selling through
memberships.
3. Internet Finance Apps
I. Asset Management
As of June 2016, 101 million Chinese internet users (14.3%) manage their assets online, an
increase of 11.13 million, or 1.3% from the end of 2015. Online asset management has
undergone fast development in recent years, with an increasing number of products available,
and improved user experience across the products.

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With promotional efforts by major internet finance companies, and the concept of asset
management being increasingly appreciated by the general public, online asset management is
seeing greater adoption. The major online finance companies have been extending their product
offerings, all aiming to become one stop shops.
Companies are extending adoption triggers for online asset management, shifting simple focus
from returns to focus on users with particular needs and provide greater return to attract
particular groups of users.
II. Online Payment
As of June 2016, 455 million users use online payment applications, an increase of 38.57 million,
or 9.3% from the end of 2015, with user adoption rate increasing from 60.5% to 64.1%. Mobile
payment user has also grown quickly, increasing 18.7% from the end of 2015, reaching 424
million. Adoption rate has increased to 64.7% from 57.7%.
Over the first half of 2016, the three engines behind fast growth of online payment: fast growth
in e-commerce has increased the need for online payment; online payment providers have
increased and extended offline usage triggers for their payment apps, and have incentivized
further adoption by subsidizing payment to third parties; providers have increased social
promotional efforts to bring friends of users to the payment system.
Online payment usage is still in the minority however, replacing cash and card payment is a
direction for the future. Online payment system has access to user spending patterns and is able
to compile user credit scores for third parties.
4. Online Entertainment
I. Online Games
As of June 2016, 391 million Chinese internet users (55.1% adoption) play an online game. 302
million are mobile online gamers, an increase of 23.11 million, constituting 46.1% of all mobile
users.
In the first six months of 2016, the number of online gamers remains stable. Online games in
China are showing trends of moving to mobile, increased copyright protection, and are
increasingly being made into films to further monetize the intellectual property.
First, computer gamers have continued their migration to mobile. In the first half of 2016, the
proportion of computer users playing online games has dropped to 61.4% from 67.7% six
months ago. Whereas mobile online game adoption rate has increased to 77.3% from 71.3% six
months ago. In the future, with increased quality and enriched functionality of games, mobile
gamer population will continue to increase.

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Second, copyright protection of online games has continued to improve, especially evident with
mobile online games. The new “Regulations on Mobile Game Services” requires that all mobile
games served to users in China must have been licensed by the National News and Broadcasting
Bureau, hence copyright issues plagued development of mobile online games will be alleviated.
Besides, major copyright owners such as Tencent, Changyou, Wanmei have all proactively
pursued copyright infringement cases.
Last, online game contents are being converted into films and TV series. Online games is
becoming increasingly integrated into the overall entertainment industry.
II. Online Literature
As of June 2016, readers of literature online has reached 308 million (43.3% adoption rate), an
increase of 10.85 million from the end of 2015. Online mobile literature readership has reached
281 million (42.8% of mobile users), an increase of 22.09 million from the end of 2015.
After major M&A activities over the recent two years, a clear pattern has emerged in the online
literature market. Ecosystem development and copyright protection has received widespread
adoption among the major literature platforms.
Online literature is now centered on the IP source, monetization pathway has become
diversified and multiple platforms are now running profitably. At the forefront of the online
entertainment IP chain, online literature has accumulated a large group of loyal readers by
leveraging the zero cost content distribution framework that is the internet. This loyal following
is readily converted to fans of any IP conversions to film, series, or games. Other than fee-paying
readers, online literature platforms also make money from subsequent IP licensing deals.
Since the advent of online literature, online content has been pirated by competing sites,
disrupting the market for original writing. The low cost nature of pirated sites make enforcing
online literature copyright an expensive endeavor. With increasing concentration of online
literature platforms, larger platforms have more reader loyalty and reader concentration, and
have more resources for copyright enforcement. As a result, authors and readers are
increasingly concentrated to the larger platforms.
III. Online Video
As of June 2016, China online video audience has reached 514 million, an increase of 10 million
from the end of 2015. Online video user adoption is at 72.4%, a slight reduction from 2015
levels. Mobile video user level reached 440 million, an increase of 35.14 million (or 8.7%) from
the end of 2015. Mobile video adoption rate is at 67.1%, an increase of 1.7 percentage points
from 2015 levels.
In the first six months of 2016, major video portals have actively pursued opportunities to
collaborate with the entertainment industries.
Multiple devices are being used for video consumption, including computer, mobile, and smart
TV. 85.7% of all online videos are now consumed by mobile phones, a genre growing at a faster

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pace than the overall market. Mobile traffic accounts for ~70% of all traffic to the major video
portals. The mobile screen is now the most important one for video in China. On another aspect,
with increasing adoption of smart TVs in China, 21.1% of internet users in China use TV to access
content over the internet, with adoption rate increasing year on year.
On video content, competition between the major video portals on content acquisition has
reduced, with self-produced content starting to focus on quality and differentiation. Along with
the maturation of online video, major video portals have all expanded into upstream
production, professional operations has improved the quality of self-produced content. The
quantity of self-produced content may soon exceed in-licensed content hosted on major video
portals.
On monetization, quality content is the main driver for customers to pay. Since 2015, premium
subscriptions to video portals has increased, revenues from premium members as a proportion
of total revenues has also increased. The major video portals attract premium users through the
differential release of sought after series.
IV. Online Music
As of June 2016, 502 million internet users (70.8%) in China are consumers of online music, an
increase of 0.77 million from 2015 levels. Of which, consumers of mobile online music reached
443 million (67.6% of all mobile users), an increase of 27.07 million.
Improvements in the online music market over the first half of 2016 include improved copyright
protection, content source diversification, and consumer ecosystem formation:
Formalizing copyrights for the online music industry in China has provided the foundation for a
prosperous industry. The National Copyrights Bureau requires that all online music platforms to
pull none copyrighted content. Since then, copyright infringement in China’s online music
industry has reduced. The inter platform licensing of music content has taken place between
online music platforms in China, generating revenue while ensuring content sources meet
copyright law.
The source of content for online music is increasingly diversified. Based on the demand of
China’s users on international music, major music platforms such as QQ music, Alibaba Music
are investing heavily in overseas music companies, channeling copyrighted content into China
while increasing its own competitiveness in the market. On another front, the increasing
availability of platforms hosting original music, is providing a venue for all artists to showcase
their talents, the market potential for original music is gradually emerging.
A music industry ecosystem is coming into existence: online music is increasingly being
integrated into other forms of online entertainment. An increasing number of music authors are
drafted in to supply original music to the production of online games and videos. At the same
time, online music industry is expanding into related markets, connecting live performances, fan
engagements, media campaigns, and ticketing platforms.

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V. Live Broadcasting
Live broadcasting became popular over the first half of 2016, and had fast development under
heavy investments. As of June 2016, live broadcasting users has grown to 325 million, at 45.8%
of all internet users.
In the first half of 2016, personal live shows and gaming live broadcastings became the major
engines of growth for online broadcasting, adoption rates are 19.2% and 16.5% respectively
within internet users. Since the costs are high for marketing, hosting, and signing up
broadcasters, relying on virtual gifts and advertising revenues are not sufficient for profitability.
The monetization strategies is still being discovered. Besides, Department of Culture has started
to regulate broadcasting platforms since April 2016: all broadcasters need to have their personal
identities confirmed, tighter regulations are expected in the near future.
Sports broadcasting centers on sporting events to acquire new users, hence competition for
sports broadcasting rights is intense. In the first half of 2016, Xiaomi, Leshi, and Fengbao all
reached separate deals with international sports games for live broadcasting rights, leveraging
exclusive rights for competitiveness.
Live concert online broadcasting, a new publication format for live concerts, is also in discovery
stage. As of June 2016, live concert broadcasting adoption rate is 13.3%. Compared to
traditional formats, live concert broadcasting broke space limits and, through live chats and live
votes, enabled real time engagements between fans and artists. With adoption of VR, user
experience of live broadcasts has further room for improvement.
Figure 18 Adoption Rates of Live Broadcasting Services among Internet Users in China June 2016
0% 5% 10% 15% 20% 25%
Sports
Personal
Game
Concert
Adoption Rates of Live Broadcasting Services

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5. Public Service Applications
I. Online Education
As of June 2016, users of online education in China reached 118 million, an increase of 7.75
million or 7.0% from 2015. 16.6% of internet users use online education. 69.87 million Consume
online education on mobile, an increase of 16.84 million, or 31.8%. Mobile online education
adoption rate is 10.6%, an increase of 2 percentage points from 2015.
Trends in online education:
Strong demands exist for online professional education: updates for kills and knowledge is
required to keep up with new developments, opportunities for education + employment service
exist.
Mobile education is becoming mainstream for education online. According to a CNNIC survey,
59.3% of all online education users are mobile, an increase of 11 percentage points from 2015.
Leveraging on touch, video and voice, mobile education can enrich user experience, putting the
fun into learning.
II. Car Hailing
In the first six months of 2016, online car hailing user population reached 159 million, or 22.3%
of internet users. Cars hailed online include those from specialist professional drivers, taxi, non-
professional drivers, and shared rides.
Online taxi hailing increased the coverage of individual taxies, with improved safety through real
time journey tracking. Hailing of other types of cars complements existing taxi services.
III. Online Governmental Services
As of June 2016, users of online governmental services reached 176 million, or 24.8% of all
internet users. Of which, 14.6% obtained services through governmental WeChat accounts.

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Figure 19 Adoption Rates of Governmental Services, China 2016
0% 2% 4% 6% 8% 10% 12% 14% 16%
Government WeChat
Government Weibo
Government Mobile App
Adoption Rates of Governmental Services

38th China Internet Development Status Report

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