Restrictions of Internet provided services in the People’s Republic of China

A threat for foreign companies’ Internet launch?

Term Paper, 2010

17 Pages, Grade: 1.3


Table of Contents

List of Illustrations

List of Abbreviations

1. Introduction

2. Internet in the People’s Republic of China - facts and figures

3. The Internet advertizing market

4. The Golden Shield - ‘Censorship’

5. Blocked Internet services

6. Google vs. China - a battle on the e-platform

7. Conclusion

8. Literature/Sources

List of Illustrations

Illustration 1 : Chinese Internet User Population

Illustration 2 : Internet access growth rates by means for 2009

Illustration 3 : Income structure of Internet users

Illustration 4 : Age structure of Internet users (mobile and overall)

Illustration 5 : Censored keywords and websites

List of Abbreviations

illustration not visible in this excerpt

1. Introduction

In China today the Internet is an important means for communication, information and advertisement. On the mainland of the People’s Republic of China the first Internet connection was established on September 20th 1987. This first step into a new era was realized between ICA Beijing and Karlsruhe University in Germany under the leadership of Professor Wang Yunfeng and the German Professor Werner Zorn. As in many countries these days’ connections were set up by a machine-to-machine link, that means with no direct access to the Internet as we know it today. Basically networking was exclusively used by academic institutions, for example the Institute of High Energy Physics (IHEP) in Beijing which in 1987 connected to the CERN, the European Organization for Nuclear Research in Geneva. Since then Internet networking emerged from the scientific and academic sector to a general access for private households1.

Nowadays Internet is not only used at work, but more and more at home. As a utility for private life its value is increasing significantly since Chinese netizens (a portmanteau of Internet and citizen) have explored a new source for information, merchandizing and social communities. But along with this luxurious way of communication comes an option for the Chinese government to control its inhabitants wherever they move. Netizens have to take care of their behavior, as well as domestic or foreign companies when accessing the Internet in China. In the following chapters potential threats of failure which companies might be confronted with are analyzed in order to find a sustainable solution not to miss the access to one of the most prospective markets.

2. Internet in the People’s Republic of China - facts and figures

By December 2009 China had 384 million Internet users, representing 28.7% of the whole Chinese population and 21.3% of Internet users worldwide. North America for example had 259.5 million users by the end of 2009, which represents nearly 76.2% of its population (14.4% of Internet users worldwide)2.

What is really interesting to see is that from the year 2000 to 2009, the number of Chinese Internet users has grown by 1,500%, in the same period the Northern American growth rate accounts for 140.1% and Germany with a total of 62 million users experienced a growth of 158.2%. This tremendous growth rate is based on increasing investments in infrastructure facilities in the last couple of years. Those investments are promoting steady growth in telecommunication network developments so that even rural areas are able to access the Internet.

One of the most recent and most important developments was the invention of mobile Internet accessibility, i.e., users of mobile telephone communication are able to connect to the internet via G3-systems which are provided by Chinese ISPs. This accessibility is possible, regardless of which province you are travelling to and whether fixed lines exist there or not. Still, fixed line dial-up connections (through wire) account for about 92% in China in 2009.

The majority of Internet connections in China are broadband, e.g. DSL with transfer rates of 1 megabyte or more per second, offered by companies like China Telecom and China Netcom. The 25th Statistical Survey Report on Internet Development in China released by the CNNIC provides an insight into how the Internet evolved.

Illustration 1 shows the continuous growth of Chinese Internet usage. From December 2007 on it recognizes a slow semi-annual decrease from a peak of 29.6% to still enormous 13.4% in June 2009.

Illustration 1 : Chinese Internet User Population

illustration not visible in this excerpt

(Source: CNNIC - Chinese Internet Network Information Center)


1 Compare:

2 Compare: Internet usage in Asia, the United States and Europe (

Excerpt out of 17 pages


Restrictions of Internet provided services in the People’s Republic of China
A threat for foreign companies’ Internet launch?
Cologne University of Applied Sciences  (Faculty for Economics and Business Administration)
Export Management and International Marketing
Catalog Number
ISBN (eBook)
ISBN (Book)
File size
765 KB
restrictions, internet, people’s, republic, china
Quote paper
Holger Bracker (Author), 2010, Restrictions of Internet provided services in the People’s Republic of China , Munich, GRIN Verlag,


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