Even after several years of torrid growth, the internet sector remains one of the greatest secular growth stories in China. There were 384 mn internet users in China at the end of 2009–more than any other country but representing only 30% penetration. We estimate internet usage will double in five years. Moreover, we think that the industry will continue to see strong earnings growth in 2010—supported by a recovering economy and 84 mn new internet users.
But, how much should investors pay for this growth? We believe that P/E multiples of …

A marketer’s guide to the world of Chinese networking.
Over the past few years, brand presence on Chinese SNS has largely been limited to passive and static advertising and the occasional branded widget. But recently, brands have been pursuing more creative and interactive ways to engage SNS users by upping the level of brand-consumer interactivity. These efforts range from curated BBS discussion forums to interactive contests within the confines of a particular SNS. Compared to other online markets, branded efforts on local Chinese SNS are still in an embryonic stage, however. …

Exclusive Online Matchmakers Charge Sky-High Fees, Organize Lavish Events
This week, a CNN article on the big business of online matchmaking in China looks at exclusive services targeting China’s super-rich bachelors. According to the article, membership sites like “Golden Bachelor” charge upwards of 300,000 RMB (US $44,000) for their matchmaking services, which pair men with personal or family wealth of at least 2 million yuan ($292,000) to women who meet strict height, weight and appearance guidelines. According to the article, matchmaking businesses like Golden Bachelor will probably become more common in coming years, …

In the last quarter of 2009, a number of significant public speeches were made about Internet of Things in China. It started on August 7, when Chinese Premier Wen Jiabao made a speech in the city of Wuxi calling for the rapid development of Internet of Things technologies. It included this equation: Internet + Internet of Things = Wisdom of the Earth. Wen Jiabo followed up with a speech on November 3 at the Great Hall of the People in Beijing, in which he encouraged breakthroughs in key technologies …

The January 2010 “Statistical Survey Report on Internet Development in China” was recently published. The report itself is 90 pages long, but here’s what I think you might find most interesting…
Highlights

Now 384 million Chinese internet users.
Big jump in usage of social networking sites.
Huge increase in the number of internet users that access the internet via mobile devices.
Value of online shopping transactions doubles!

User Numbers
Another Year, Another 80-Something Million Internet Users
The number of Chinese internet users has now reached 384 million. Even though that’s 86 million more than there was last year …

As Google considers withdrawing from China, the BBC looks at the highs and lows of internet access and freedom in the most populous country in the world.
1 May 2001: US and Chinese hackers engage in an internet war as the diplomatic row about the crashed US spy plane rumbles on.
7 November 2002: Activist Jiang Lijun arrested following an investigation that used information supplied by Yahoo.
14 June 2005: Microsoft agrees to censor its blog writing tool , called Spaces, on MSN China
7 September 2005: Net giant Yahoo is accused of supplying information to …

Wine Production Tours Allow Students, Businesspeople Opportunity To Meet Wine Experts, Sample Beijing Favorites
Changyu, a popular winery for wine tourists, is fighting to be seen as China’s preeminent, and possibly first world-class, winery
One of the interesting developments that has followed increased consumption of and appreciation for grape wine in China has been the spread of “wine tourism” around the country. Over the past few years, more tour operators have added winery tours both for Chinese tourists going overseas and international tourists coming to China, which have proven quite popular — …

China added 86 million users in 2009 to reach a total of 384 million Internet users by December 30, up 28.9% from late 2008, according to a report released January 15 by the China Internet Network Information Center (CNNIC). China added 120 million mobile Internet users in the year to reach a total of 233 million, representing 60.8% of all Internet users, CNNIC said.

Domestic broadband users reached 346 million by the end of 2009, 76 million more than that of 2008. Rural Internet users accounted for 28.7% of the users, …

Local Market Knowledge Helped Baidu, but So Did Piracy, Nationalism and Marketing
HONG KONG (AdAge.com) — Google’s decision to pull out of China unless the authorities will allow uncensored search results — an unlikely outcome — probably does stem from moral outrage over the government’s heavy-handed tactics.
But it could be a face-saving way to exit a market where Google has made surprisingly little progress. Most research companies agree Google controls at most one-quarter of China’s search market. That’s hard to swallow, given Google’s dominant position in the U.S. and many other …

Mainland Tourist Spending Abroad Outspent International Tourist Spending In China For The First Time
Despite being outnumbered nearly three to one, outbound Chinese tourists outspent inbound tourists to China by $4 billion
Chinese Media is reporting this week that outbound tourists from mainland China spent some $42 billion overseas (including Hong Kong, Macau and Taiwan) last year, outspending inbound international tourists for the first time. Though articles do point out that the majority of first-time outbound tourists from the mainland went to nearby Hong Kong (18%) and Macau (16%) — two very accessible destinations …

“We actually did an evil scale and decided not to serve at all was worse evil.”
– Google CEO Eric Schmidt on the company’s decision to offer a censored version of its search services in China, Jan. 30, 2006
Before reflecting on the latest news, also take some time to watch Kaifu Lee’s presentation on Youtube about Google’s approach to Google, and the Internet landscape in China – to Carnegie Mellon students in Feb 2008. (Kaifu Lee resigned as CEO of Google China in late 2009)
Evidently Google is taking its informal “don’t …

Expatriate salaries and packages in Mainland China have been more or less stagnant in the past 10 years, but are today still higher than in most South-East Asian countries, or other typical countries where expatriates are needed. – René J.M. Schillings, Managing Director of TOP Hoteliers – Hospitality Executive Search.
As the first hospitality recruitment company with offices in the PR China (since 2004), and recruiting for nearly all hotel brands in all cities in China, from Harbin to Hainan, Schillings can clearly see trends over the past 5 years, and …

Spanish Hotelier’s Newest Five Star Property Located In City’s Central Lujiazui District
The Gran Melia Shanghai is Sol Melia’s newest, and first China, five star property
The growth in domestic tourism and business travel in China, as well as sustained demand from international travelers, has brought virtually every major global hotelier to China over the past 20 years. Recently, Shanghai in particular has been the site of a luxury hotel construction boom, as world players fight to finish new properties in time for the Shanghai World Expo, set to take place this …

China National Tourism Association released some 2009 travel industry statistics (zh).   The report, translated by ChinaHospitalityNews, states:
The report reveals that China achieved total revenues of about CNY1.26 trillion from tourism  in 2009, which was an increase of 9% over that of the year before. During the year, China’s domestic travel continued its rapid growth, its inbound travel market resumed gradually and outbound travel market developed steadily.
According to the report, in 2009 China received a total of 1.9 billion domestic tourists, which was an increase of 11% over that of 2008. The country’s …

UAE Expects Wave Of Chinese Visitors In 2010, Following September Visa Changes
Dubai hopes more Chinese tourists will inject much-needed cash into its tourism industry in 2010
One of the interesting effects of the global economic slowdown has been the growth in outbound tourism among mainland Chinese. Although foreign travel still remains an elite activity despite the large numbers of Chinese tourists appearing in cities like New York, Paris and Tokyo, visa restrictions are easing year by year and rising incomes (as well as a growing middle class) mean that more mainlanders …

Event Follows Italian Culture Year In China In 2006
China and Italy have increased their cultural exchanges over the past 5 years
Last summer, Beijing and the Lazio region of Italy announced a cooperative event that featured Chinese novelist Mo Yan as the Chinese “brand ambassador,” and focused on promoting stronger cultural ties between the two governments while bringing more  Chinese and Italian tourists to both regions. Following this event, China and Italy this week announced that “Chinese Culture Year in Italy” will begin in Italy next September.
This “culture year” follows a …

By Lara Farrar, for CNN – December 28, 2009//
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Beijing, China (CNN) — A handful of homegrown micro-blogging sites emerged about the same time Twitter started to gain a small, yet steadily growing, share of Chinese Internet users, beginning about 2007, around a year after Twitter was launched in the U.S. in 2006.
While almost all of the early Chinese micro-blogging pioneers faced the same fate as Twitter, most of the sites …

SHANGHAI (AdAgeChina.com) — Blogging has become a national obsession in China, with over 50 million Chinese regularly contributing to local blog sites. A handful of these sites are written in English, and provide a fascinating perspective on a country that is changing quickly. Below, we’ve identified 25 blogs that can serve as a great resource for marketers in China.
1. Access Asia (www.accessasia.co.uk), a U.K.-based company providing market intelligence about Greater China, publishes a snarky weekly update reflecting relevant business, economic and political issues.
Recent post: The Great Proletarian Outdoors Revolution! Well …

Popular Films, More Accessible Travel Draw Mainland Tourists To Remote Locales Both In China And Abroad
Last year, the Xixi wetlands in Zhejiang province saw a massive influx of domestic tourists following the runaway success of Feng Xiaogang’s film “If You Are the One” (“非诚勿扰”).
Last year, the blockbuster “If You Are the One” by Chinese director Feng Xiaogang included a 20 minute sequence shot at Xixi in Hangzhou, in China’s coastal Zhejiang province. In the movie, the lush foliage and ambiance of the Xixi wetlands swept audiences off their feet and heightened …