Highlights of Internet Development in China in 2015 and Development Prospect in 2016

    In 2015, the bright spots of Internet development in China appeared frequently. This aspect benefited from the rich accumulation of talents, users, products, companies, capital and concepts after 20 years of development of the Internet in China, which ushered in a period of rapid development from a network power to a network power; On the other hand, thanks to the top-level design of the country and the active participation of the whole society, the "internet plus" has risen to the national strategic level, promoting mass entrepreneurship and innovation, and the Internet has become an indispensable part of China’s infrastructure construction, scientific and technological progress, economic transformation, social development, national governance and even international exchanges and cooperation. 

    Highlights of Internet Development in China in 2015

    The 13th Five-Year Plan proposal adopted by the Fifth Plenary Session of the 18th CPC Central Committee emphasizes the implementation of the strategy of strengthening the country through network, the implementation of the "internet plus" action plan, the development of sharing economy and the implementation of the national big data strategy. The national top-level design has greatly promoted the Internet to penetrate all aspects of China’s economic, social and cultural development.

    (A) the national strategic level

    1. "internet plus" has risen to a national strategy and built a new ecology of economic development.

    In March, the government work report proposed to formulate the "internet plus" action plan, and in June, the the State Council executive meeting adopted the "internet plus Action Guiding Opinions". In 2015, eight ministries and bureaus, including the National Development and Reform Commission, the Ministry of Industry and Information Technology, the Ministry of Communications, the Ministry of Agriculture, the Ministry of Commerce, the Health Planning Commission, the Tourism Bureau and the Energy Bureau, issued the "internet plus", among which the Ministry of Commerce has issued the first ministerial-level action plan, and the Ministry of Industry and Information Technology issued the "internet plus" three-year action plan. Subsequently, local versions of action plans were launched one after another. Fujian, Jiangxi, Jiangsu, Guangdong, Sichuan, Hunan, Henan and other provinces will definitely formulate their own Internet action plans. More than 20 provincial local governments across the country have signed strategic cooperation agreements with major Internet companies to carry out comprehensive and in-depth cooperation in cloud computing, big data, smart city construction, Internet public services, e-commerce and Internet finance.

    "internet plus" related forums and conferences are getting more and more popular. From government to enterprises to individuals, people are exploring how to use the power of the Internet to achieve efficiency improvement, industrial upgrading and innovation and entrepreneurship. Internet plus Finance, inclusive finance in the Internet Age; Retail in internet plus, achieving e-commerce; Internet+education to achieve universal online education; Internet plus Life Service, Achieving O2O. The "mass entrepreneurship and innovation" promoted by the Internet are also concentrated in these areas. The future Internet will be combined with agriculture, education, medical care, finance, transportation, tourism, culture, home, life service, media, advertising, retail and other industries to form a new ecological landscape.

    2. Accelerate the pace of becoming a network power and actively participate in global Internet governance.

    In October, the "Thirteenth Five-Year Plan" proposal adopted by the Fifth Plenary Session of the 18th CPC Central Committee clearly stated: "Implement the strategy of strengthening the country by network and accelerate the construction of a new generation of information infrastructure with high speed, mobility, security and ubiquity". China has nearly 700 million netizens, more than 4 million websites, 1.3 billion mobile phone users, 600 million WeChat and Weibo users, and the market value of 7.85 trillion Internet listed companies. It is a veritable Internet power. At present, four listed companies, Alibaba, Tencent, Baidu and JD.COM, have entered the top 10 global Internet companies. Non-listed companies such as Huawei, Ant Financial and Xiaomi have also entered the top 20 in the world. China’s Internet industry is developing steadily, the market competition is full, and its independent innovation ability is enhanced, and it is making great strides to become a network power.

    In 2015, China actively participated in the global Internet development and governance, fully expressed China’s proposition of establishing a new global cyberspace order, and put forward the "China Plan" for Internet development and governance. In September, the Chairman of the Supreme Leader visited the United States, and the two sides reached important consensus on cybersecurity and other aspects, and reached six achievements in the Internet field. In December, China hosted the second world internet conference with higher specifications and larger scale. In the keynote speech of the conference, the supreme leader put forward four principles of respecting network sovereignty, maintaining peace and security, promoting open cooperation, and building a well-ordered global Internet governance system, and five propositions of jointly building a community of cyberspace destiny, which have far-reaching influence.

    3. Comprehensively promote the national big data strategy and build a data power.

    The 13th Five-Year Plan proposes that China will implement the strategy of strengthening the country through network, the "internet plus" action plan and the national big data strategy. In September, the State Council officially issued the "Action Program for Promoting Big Data Development", which put forward the top-level design of China’s big data development from the overall height of the national big data development strategy. The Ministry of Industry and Information Technology is formulating the "Thirteenth Five-Year Development Plan for Big Data Industry". On November 17, People’s Daily published an article signed by Meng Jianzhu, Minister of Public Security, proposing to co-ordinate the construction of infrastructure such as big data, cloud computing center and Internet of Things.

    The convergence of the Internet and human economic and social activities has triggered explosive growth of data. Big data has become the core theme of deepening the development of national informatization and the next starting point for the country to promote the development of informatization. Developing big data has become an inevitable choice for building a data power and promoting big data to govern the country. Local governments have begun to actively seize the opportunity to promote the development of big data. On April 14th, Guiyang Big Data Exchange, the first big data exchange in China, was officially put into operation and completed the first batch of big data transactions. The Southern Data Center of the three major communication operators and the first national comprehensive experimental zone for big data were also completed in Guizhou. On December 12th, Zhongguancun in Beijing released the roadmap and enterprise distribution map of "Big Data" industry to the society for the first time. By 2020, Zhongguancun will gather 600 big data innovative enterprises and cultivate 6,000 enterprises with big data application capabilities.

    (B) the level of industry development

    1. "internet plus" is more manifested as "moving internet plus".

    No matter from the market, equipment, traffic, or from the user’s point of view, the mobile Internet will continue to maintain rapid growth. According to CNNIC statistics, as of June 2015, the number of Internet users in China reached 668 million, while the number of mobile phone users reached 594 million. The proportion of Internet users using mobile phones increased from 85.8% in December 2014 to 88.9%. According to the statistics of iResearch, in the third quarter of 2015, the scale of China’s network economy reached 278.39 billion yuan, with a mobile contribution rate of 36.0%, which is still increasing. In October, the monthly average mobile Internet access traffic reached 361.6M, up 88.3% year-on-year, and the mobile Internet access traffic reached 2.88 billion g, which doubled in October. China has built the world’s largest fourth-generation mobile communication (4G) network.

    "internet plus" is more manifested as "Mobile internet plus", and its new products, new applications and new models emerge one after another, laying a solid foundation and creating a broad space for "internet plus" action. In the field of the combination of the Internet and traditional industries, the mobile Internet has seized the limelight, and the investment and financing in the fields of transportation, finance, education, medical care, socialization, tourism, entertainment, life service, e-commerce, advertising and marketing are extremely active. A new round of hardware innovation represented by wearable devices, smart cars and smart homes has flourished, with core chips, operating systems, HTML5, 4G/5G, cloud computing and smart homes.

    2. Internet services are vertical and refined, and O2O is reshuffled and adjusted.

    Various service fields of the Internet are developing vertically, splitting out more subdivided demands, attracting capital investment and giving birth to entrepreneurial opportunities. Among them, O2O field is the most active, covering almost all peripheral services such as automobiles, tourism, education, take-away, laundry, car washing and housekeeping. With the increase of market competitors, the vertical market is characterized by severe verticalization and refinement, and the adjustment of O2O industry is also in full swing.

    Driven by capital and market, the core areas of Internet vertical services, such as online reading, O2O, online travel, and dating networks, began to be strong and strong, and the stronger they became. In January, Shanda Literature and Tencent Literature merged; Didi, quick merger in February; In April, 58 Tongcheng and Jiji.com announced the merger; In October, the public comment, the US Mission announced the merger, Ctrip and Qunar announced the merger; In December, jiayuan and Lily.com announced the merger. There are fewer opportunities left for small and medium-sized entrepreneurs in the whole vertical field, but small and beautiful enterprises are still likely to counterattack by deeply cultivating "the refinement of serving people" and "the uniqueness of consumption scenes".

    3. The Internet helps the sharing economy to reconstruct a new format and become a new driving force for future industrial development.

    On October 29th, the word "sharing economy" appeared in the communiqué of the Fifth Plenary Session of the 18th CPC Central Committee, and it was proposed to "develop the sharing economy". At the second world internet conference, the Chairman of the Supreme Leader talked about the need to focus on developing new formats such as sharing economy during the 13th Five-Year Plan period. It is the development of Internet technology that makes the sharing economy enter a new stage of development. It is suggested that 2015 is the first year of sharing economy in China.

    Sharing economy is a sharp weapon to transform and upgrade traditional industries with Internet thinking. The traditional "rules of the game" in the fields of house leasing, transportation, housekeeping, hotels, restaurants and so on are being changed. Apps such as Didi Chuche, Ride, Dada, Everyone Express, and Going Home for Dinner are typical business products of the sharing economy. The sharing economy is changing the industrial chain structure of the format and reconstructing the original format. This format connects many idle, scattered and silent resources in society, and optimizes the allocation of social resources with the help of mobile Internet, big data and geographical location services, which not only reduces the cost, but also solves the "pain point", to some extent, changes the mode of relying on continuous investment to expand reproduction, and finally breaks the original business rules. The new format and mode of sharing economy are becoming a new driving force to promote the future industrial development.

    4. The new network culture is booming, creating a new path for the prosperity and development of the cultural industry.

    On October 19th, the Central Committee of the Communist Party of China’s Opinions on Prospering and Developing Socialist Literature and Art put forward that we should vigorously develop online literature and art. Driven by the policy and cultural consumption demand, the emerging network culture is booming. At present, the scale of China’s network culture industry reaches 150 billion yuan, up 200% year-on-year; Online original literary works exceed the sum of works published by paper media in contemporary literature for 50 years. With the rapid and extensive coverage of social media, a number of self-media with the responsibility of spreading knowledge of Chinese studies and promoting traditional culture have sprung up. With the help of the Internet, the overseas spread of China culture has reached an unprecedented breadth.

    Internet "IP" (the abbreviation of intellectual property, meaning intellectual property) became the top hot word in the Internet field in 2015. The popular IP derived from online literature became the focus of crazy competition among major film and television companies, and many TV dramas adapted from the Internet "IP" were broadcasted, which triggered many rounds of social debates and highlighted the value of online IP. At present, around the popular "IP", a mature one-stop industry such as film and television drama, online drama, radio drama, comics and game production has been formed. From copyright trading to the production and distribution of film and television content, to the development of a series of derivative products such as games, e-commerce, real entertainment, toys, artists’ brokers, fan economy, etc., the improvement of production and creative ability brings about the feasibility of realizing products in various forms. Network culture has become an important force to promote the rapid development of China’s cultural industry.

    5. The independent innovation capability of Internet technology has been enhanced to promote the development of smart industry in China.

    In 2015, the development of Internet technology in China achieved major breakthroughs in many fields, such as 4G/5G network technology, mobile chips, intelligent terminals, cloud computing, big data, satellite navigation, etc., showing the characteristics of significantly enhancing the independent innovation capability of network technology, accelerating the catching-up of intelligent terminal manufacturing industry, and constantly cultivating new technologies and applications to form new formats.

    At the second world internet conference "Light of the Internet" Expo, the virtual fitting mirrors of Baidu unmanned vehicle, Alibaba Cloud technology, JD.COM "Weilian Smart Home" and Suning "Augmented Reality" displayed the latest technologies, products and applications of the Internet in China. Emerging technologies such as the Internet of Things, virtual reality, smart wearables, drones, service robots, and intelligent networked cars accelerate commercialization. The close combination of Internet and intelligent manufacturing has become the leading mode for the development of Industry 4.0 and smart industry. Traditional manufacturing fields are focusing on creating intelligent factories and interconnected factories, developing intelligent manufacturing equipment, developing intelligent terminal products, encouraging artificial intelligence hardware innovation, and promoting digital and intelligent upgrading of consumer electronics products.

    6. Internet and industry are deeply integrated to promote the evolution of new media and communication methods.

    In 2015, the pace of traditional media in building new media and promoting media integration was greatly accelerated. A "central kitchen" and a "super editorial department" were set up to carry out process reengineering and institutional reorganization, build a media-integrated cloud platform, open up PCs and mobile terminals, and distribute information around users on demand. Drone news, data news and robot news began to appear. Traditional media in many places launched a new version of the news client, and the People’s Daily client was launched in the third phase. Boundless, Southern Plus, Nine Schools, Cover, Meeting Point, Looking at Chutian and Frontier appeared one after another, and the mobile internet field became the main battlefield for media integration and development. In the future, the development of new technologies such as 4G and 5G mobile communication technology, big data, Internet of Things and wearable smart devices will have a far-reaching impact on the transformation of the media industry. Different channels and forms of media information will be integrated into the digital platform. Internet has eliminated the boundary between media and non-media platforms, and new media groups and modern communication systems with three-dimensional diversity and integrated development are taking shape and developing.

    (C) the level of social management

    1. The construction of the rule of law in cyberspace has been comprehensively promoted, providing a solid guarantee for the network power. 

    Cyberspace, like the real society, should not only advocate freedom, but also maintain order. Cyberspace is not an "extra-legal place", which has become a social consensus. Promulgating network security laws and regulations and a series of guiding opinions on industry development, strengthening the governance of cyberspace and cracking down on illegal crimes are the proper meaning of cyberspace governance and the necessary guarantee for building a network power.

    Since the 18th National Congress of the Communist Party of China, China’s cyberspace legal system has taken shape, covering many aspects, such as cybersecurity legislation, Internet infrastructure and basic resources legislation, Internet service legislation, e-government legislation, e-commerce legislation and Internet criminal legislation. In July 2015, the "Cyber Security Law" (draft) was open to the public for comments. The Ninth Amendment to the Criminal Law of People’s Republic of China (PRC), which was implemented in November, strengthened the protection of citizens’ personal information and added provisions on the crime of fabricating and disseminating false information. The Telecommunications Law and the Electronic Commerce Law are being drafted. In addition, the promulgation of normative documents and opinions such as Several Opinions on Strengthening the Service and Supervision of Market Subjects by Using Big Data, Action Plan for Promoting the Development of Big Data and Opinions on Strengthening the Supervision of Online Markets has become a supplement to cyberspace regulations.

    2. Internet thinking promotes the transformation of government functions and innovates social management.

    The development of the Internet should benefit people’s lives and be implemented by the transformation of government functions. In May, the State Council issued the Work Plan for Promoting the Combination of Decentralization, Administration and Transformation of Government Functions in 2015, pointing out that in promoting the innovation of supervision methods and optimizing government services, we should actively use information technology such as big data, cloud computing and Internet of Things to explore a new model of "internet plus supervision". In July, the State Council issued the Guiding Opinions on Actively Promoting the "internet plus" Action, clearly requiring "to build an integrated online public service system for the public and a new model of networked social management service with public participation". The Internet is deeply integrated with the government public service system, which simplifies the public service process with Internet thinking, promotes the equalization of resources, and greatly improves the service level and efficiency of the government. Government websites, Weibo, WeChat and government clients are becoming platforms for providing more convenient, better, all-round and all-weather public services.

    At the same time, communications, news, radio and television, finance, retail, transportation and other industries have ushered in great changes in the Internet age. In particular, the transformation of traditional industries inspired by the integration of Internet thinking and sharing economy has brought great challenges to government management. On November 23rd, the State Council issued the Guiding Opinions on Giving Full Play to the Leading Role of New Consumption and Accelerating the Cultivation of New Supply and New Motive Force, proposing to adjust and improve the supporting system conducive to the growth of sharing economic model. Making full use of various channels such as trade associations, enterprises and social organizations to build a new governance model with extensive social participation has become a new idea for innovative social management.

    Prospect of Internet Development in China in 2016

    It should be noted that the development of things is always one after another and affects each other. In 2016, the influence of established Internet-related development plans, policies and regulations will gradually emerge, and new technologies, formats and models of the Internet will continue to develop. The signs and trends that have already appeared in the Internet market will become clearer. In 2016, China’s Internet development may have the following trends that deserve attention:

    1. The Internet extends to the "last mile" and is increasingly becoming the infrastructure for economic and social development.

    At present, there are nearly 700 million netizens in China, and the number of fixed broadband access ports reaches 407 million, covering all cities, towns and 93.5% administrative villages in China. With the implementation of the "Broadband China" strategy, it is expected to open up the "last mile" of network infrastructure, reduce the gap of Internet development level between the east and the west and between urban and rural areas, further improve the performance of China’s Internet, reduce network charges, make the achievements of Internet development benefit 1.3 billion people in China, and make the Internet truly become the infrastructure of China’s economic and social development, just like air, land, water and electricity. The information transmission, material exchange, management and even people’s way of thinking in society generally rely on the Internet, and the information society is getting closer and closer to us.

    2. "internet plus" connects 360 lines, and the intelligent upgrade is accelerated.

    Internet technology represented by big data and the Internet of Things is rapidly permeating the whole industry, and the era of wisdom is quietly coming. The development of Internet will promote the intelligent level of products, equipment, production, management and services in manufacturing industry, and further realize product personalization, customization and batch production, process virtualization, factory intelligence and logistics intelligence. The combination of Internet and traditional industries, on the basis of vertical and refined development, will further carry out intelligent upgrading and transformation, and may achieve breakthrough expansion in the fields of car networking, smart home, wearable devices and machine automation. The supervision and service of government departments will also be more "timely, accurate, efficient and intelligent".

    3. Network culture has become a new hot spot for investment, and industrial development promotes cultural prosperity.

    In 2015, innovations in cultural concepts, contents, formats and communication channels were more reflected on the Internet. Unconsciously, a group of self-media whose mission is to spread the knowledge of Chinese studies and promote traditional culture have been frequently concerned, attracting a large number of fans; The box office of Chinese movies exceeded 40 billion yuan for the first time, and there have been many successful cases of marketing and publicity in third-and fourth-tier cities through internet channels. Some people say that "small town youth" determines the increase of Chinese movie box office; The "internet plus Culture+Finance" model is highly praised for its combination of investment and financial management, art collection and cultural communication. More and more foreign public get the image perception of China through social networks … The increasingly rich material will inevitably lead to higher spiritual pursuit, and internet plus culture will surely become a hot spot for investment. Some Internet companies have begun to set foot in media, film and television and other cultural industries.

    The consumption of Internet cultural products will become a huge market. It will become a trend to promote the effective integration of cultural industry content and channels through the Internet, promote the combination of cultural creativity with the real economy and financial capital, and realize the extension and appreciation of the value of the whole industrial chain. Taking the network as a platform to promote the sharing of cultural achievements and taking culture as a carrier to promote the construction of a community of destiny in cyberspace will become the consensus of cultural inheritance and cultural innovation in the Internet age.

    4. Technological innovation, industrial development and space governance to jointly promote the construction of a network power.

    There is still a big gap between China and developed countries in terms of infrastructure, technology, industry, network security and network discourse right. Only by breaking the weakness of core technologies such as PC and mobile phone operating system and realizing the leap from consumer Internet to internet plus industry can we promote the development of network economy and network culture and make due contributions to the prosperity of China’s economy and culture.

    At the same time, ensuring network security, promoting orderly development and building an Internet governance system will be the theme of China Internet in the future. The concept of interconnection, sharing and co-governance, which originated in China, will spread more widely around the world. More and more Internet enterprises in China will go to the world and drive the development of the Internet all over the world through their own development. China will play a more active role in the development and governance of the Internet, and the pace of becoming a network power will become more and more solid.

    Editor in charge: Zhu Xiaohu


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