WATCHING THE WEB GROW IN CHINA

Philip J. Calvert

The People�s Republic of China is the world�s most populous country, and the Word Wide Web is surely the greatest technological phenomenon of the last 20 years. Put them together, and it must be interesting, at the very least, to hear about the growth of Web use in China, especially as its government is currently open to hi-tech entrepreneurial activity that stimulates growth. This short paper is an introduction to the development of the Web in China and to its potential, written by someone who was a visitor to the country for just six weeks as an exchange scholar. Readers may reflect on Web use in their own countries and see if anything can be learned from the Chinese experience. It is not another guide to all the Chinese Web sites you care to see, and there are plenty of directories such as http://www.surfchina.com that will help you get started if that is what you want.

How significant is the Web in China, and what is its potential? The answer is that, on a national scale, the Web is not yet all that important, but given the government�s promotion of new technology and the enthusiasm of the young for its use, the role of the Web in information dissemination is sure to grow, and e-commerce has as much potential in China as it does in the West. Take-up of new technologies in China can be fast, and given its huge population the market for ICTs in enormous. As an example, there are already 60,000,000 mobile telephones in China and each year another 880,000 are manufactured in the country. That may be only less than one per 20 people, and hence much lower than almost every Western country, but the sheer volume of sales and the potential for more has all the world�s sales managers licking their lips in anticipation. Microcomputer manufacturing is equally impressive, with the total number of units made within China estimated to be around 800,000 per year. Just a few years ago Compaq and IBM were the major manufacturers, but now local companies such as Legend and Great Wall are the leading makers of personal computers in China.

There is no doubt that the Chinese government wants to see new technologies prospering. To see this in practice you need only to travel out of Beijing along Haidian Lu towards Peking and Tsinghua Universities through the area dubbed China�s Silicon Valley, and there you will see ICT companies of every description, both Chinese and international, enjoying the current boom.

Infrastructure problems mean that access to the Web is highly uneven throughout China, but where the network is good the number of people accessing the Web is rising. It is estimated that in the past year the number of Web surfers has quadrupled to nearly nine million and is growing at a rate that genuinely deserves the label �phenomenon�. It is still only the major cities of Beijing, Shanghai and Guangzhou where Web access is relatively easy, but the government is pressing on with infrastructure developments. Now there are a number of ISPs to chose from, - one example is China Time http://www.china-time.com, which hosts home pages for business and personal use. Their home page has some links to free business databases, but you have to register first.

A restriction on Web growth has been Internet charges. Some have put the blame for this on the monopoly of the national long distance backbone held by China Telecom. The government recently split the giant into four parts, but real competition still only exists in the mobile phone business. China Telecom maintains its monopoly on the fixed line business.

Internet portals are leading the development of the Web, and throughout any major city you will see advertising for http://www.sohu.com.cn and http://www.sina.com, both of them names now very familiar to the young Web-savvy generation that exchanges ICQs in the way previous generations exchanged telephone numbers. Companies such as these have helped create a new generation of millionaires in China that are the inspiration to ambitious young people who realise that the government will encourage them to make money from the Internet.

Perhaps not surprisingly, it is higher education that used the Web first. Probably the first use of the Internet in China was the China Academic Network established in 1988. Individual campuses built their own networks from 1992 (Peking and Tsinghua were the first universities with their own backbones). There are a huge number of universities and research institutes, and almost every one will have a Web site. The good news for overseas surfers is that most of them have an English version, and they are usually pretty good. For an ISP devoted to education, connect to the China Education and Research Network (CERNET) http://www.edu.cn/eindex.html, which has its network centre at Tsinghua University. It is a national network based upon eight regional networks linking 450 different campus networks. There are currently 1075 universities and institutes in China, and they may all join CERNET eventually. The physical side of the network is a DDN leased line with a top transmission rate of 2 Mbps. There are eight international Internet links to CERNET. This is more than just an ISP for higher education. Look at http://www.edu.cn/china/index.html for links to many useful sites, especially in education and research. As further evidence of the use of the Web in higher education, there are now a large number of university library catalogues available, and they can be found at http://www.lib.tsinghua.edu.cn/english.

A new direction for Web use in higher education is the support of remote learning. Each year 10,000,000 Chinese children leave school and cannot get into university because of the restricted number of students allowed on each campus and the high standards required for university entry. This has created a vast latent pool of demand for degrees by distance education, and local and overseas universities are just waking up to this. Peking University, as an example, is using courseware developed in-house to deliver law and management courses to students in nine different centres around China http://www.smde.pku.edu.cn. Because distance education can charge relatively high fees and thus generate some needed revenue for the universities, this is likely to be a major use of the Web for some years to come.

Consumer demand for educational qualifications has fuelled the growth of many so-called "Web-based schools" in China, to the extent that the Ministry of Education has introduced regulations that require educational Web site operators to be authorised by provincial governments. The intention is to allow those operated or serving existing middle or primary schools to continue to operate, but others will have to close. The purpose of the new regulations, according to the Ministry of Education, is to standardise Web-based education, curb fraud, and to stop �unhealthy instruction to students�. Apparently some so-called Web schools sell passwords to parents worried about their children�s education and deliver little in return.

Business to business e-commerce is certainly taking off, but curiously, in a country now in love with ICTs and in which shopping seems to be the new national recreation, electronic retailing has yet to make much impact. This is probably due to the low use of credit cards in China. Parts of the economy, such as Shanghai�s tourist industry, have realised that foreigners like to use their cards, but for the time being the Chinese themselves have little use for them. Not surprisingly, very few companies try to sell their products directly through their Web sites. There are alternatives; for example, it is possible to place a reservation for a train ticket via the Web by giving your name and ID Card number, but you still have to go to the station to collect the ticket and pay for it in person http://train.cei.gov.cn. At the time of writing, Air China�s Web site has an English version, but there is nothing to be found there - presumably this will come in time and it will be possible to view flight times and even make online bookings - we shall see (it is possible to order a ticket online in the Chinese version) .

There are many entrepreneurs prepared to take a gamble on the growth of e-commerce, and new ventures are starting up all the time. A new cyber mall at http://www.ChinaByte.com opened recently, selling mainly IT and digital products. Many more are likely to open, especially in the ICT sector. Television advertising has learned to link in to Web sites, especially for �marginal� products for the young and the desperate, such as slimming aids and hair tonics. The growth of Web sites has attracted bright young things from more traditional publishing sectors, creating something of a problem for them. The editor of China Book Business was alarmed to find that two-thirds of his editors had resigned within a very short space of time and they were all moving to well-paid jobs in Web publishing.

Some government departments have a �shop-window� Web site, but these offer little substantial information. You might expect rather more from the Ministry of Information Industry http://www.mii.gov.cn. There is a �government online� site at http://www.gov.cninfo.net (in Chinese). Even many companies have not yet caught on to the benefits that can be gained by using the Web for disseminating information cheaply and quickly. That some people have realised the Web�s potential as a promotional tool is apparent when you look at the attractive site created for Beijing�s 2008 Olympic Games bid: http://www.beijing-olympic.org.cn/eindex.shtm. Another interesting site at the time of writing was http://www.21cn.com based in Guangdong Province, which is trying to popularise the Web by supporting four people in their quest to trek through western China. Not only can visitors to the site follow the progress of the four, but they can also chat using visual messaging services. The budget for this promotion was 1.2 million yuan (US$144,000).

There has always been some concern in the West about Chinese observation of intellectual property rights. Whatever used to be the case, China�s hopes of entering the World Trade Organisation has brought about a major shift in policy that places observation of copyright laws as a high priority. Recent cases have included two Chinese Web sites accused of illegally providing services (hyperlinks) that enabled their customers to download sound recordings belonging to members of the International Federation of the Phonographic Industry. One company admitted it had violated copyright and paid compensation. The Intellectual Property Department of the State Intellectual Property Office is drafting laws and regulations concerning intellectual property rights on Chinese Web sites.

There is a limit to what you can find on the Web, and even the electronic revolution has not changed the government�s desire to control the flow of political information. You can read (in English) all the news that it sees fit to print at http://www.chinadaily.com.cn. This now includes Business Weekly, which has just launched an IT section. Within China it is possible to access outside news agencies such as CNN, but it takes a long time to load because it goes through a filter site first. Some things do not change.

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