The People's Republic of China

Network ACCESS

• Information Infrastructure: China may currently be ranked number 6 in the world when it comes to Internet hosts but with 380 million current Internet users and an estimated 718 million users by 2013. China may soon rank highest in Internet hosts, matching their number one ranking in landlines and mobiles. China understands they must continue to support and develop their information infrastructure. The information Infrastructure in China is in Stage 4 because of the high tele-density and is the highest in developing nations.
• Internet Availability:  The Internet Availability is in Stage 4 because it has higher bandwidth solutions such as DSL and cable modem access.  Corporate leases lines or xDSL broadband are easy to obtain thanks to the plentiful Chinese ISP completion. There are also adequate opportunities for public Internet access in the form of cybercafes. Internet usage in China will continue to rise in the coming years as more people get network access.
• Internet Affordability: Most Internet users have broadband connection via DSL. Rates vary between $10-$20 on the average. However, for some users that may be the equivalent of 10% of their monthly income.
• Network Speed and Quality: China’s network speed is far behind many countries with quicker networks. China’s network Speed and Quality is in Stage 4 due to high speed services of 1.5Mbps and the yearly packet loss of China being below 10%
• Hardware & Software: The software market in China is dominated by foreign brands like Microsoft, IBM and Oracle with very few Chinese brands competing. Chinese brands lack the technology and talent to compete. However, China is the second largest producer of ICT hardware.

Network LEARNING

• Education System: China’s education system is divided into pre-school, primary and secondary education. Here the secondary education is further divided into 2 routes, vocational education and academic based education, which leads to higher education. China’s higher education has seen a boom in enrollment from 5 million students in 1998 to 25 million in 2008.
• Schools’ Access to ICTs: According to the China Daily newspaper only 12% of Internet users are from rural areas where Internet cafes are their means of connection. Children are not permitted in Internet cafes by law. Very few labs exist in rural areas, and those that exist are running on a slow network. University students have the highest level of accessibility to the Internet. Because of the low prevalence of Internet access at the primary and middle school levels, China is at a Stage 3 for School’s access to ICTs.
• Enhancing Education with ICTs: Formal technology training in Chinese primary and middle schools are lacking. Because students often do not use computers in classroom settings, China is at Stage 3 for enhancing with ICTs.
• Developing the ICT workforce: China is between Stage 3 and Stage 4 for developing the ICT workforce. The educational system lacks the critical link between business and university that prevents the many trained workers from being used to full potential. Also, while training on subjects is certainly available in the country, often employers must look outside the country for appropriate training.

Network SOCIETY

• People and Organizations Online: Internet access depends on where one lives, a Gallup survey conducted in 2009 indicates 42% of urbanites have home Internet access compared to 11% of rural citizens. Internet access has penetrated of 29% of China.  Even though the Internet may not be available for home use for many people, because almost half of user can access the Internet from home or Internet cafes, China is in a Stage 4 but only in large cities. Smaller rural communities are in a stage 3.
• Locally Relevant Content: Because there are many local websites available with updated and relevant local information that are accessible to all, China is at Stage 4 for locally relevant content. However, the framework does not appropriately deal with the censorship of the Internet, which may make the local information less useful.
• ICTs in Everyday Life: For students in higher education, the Internet is a daily part of life, via personal computing, laptops or Internet cafes. Accessing the Internet via mobile is also increasing with an estimated 39.5% of people used this means. Obviously, the country is still rapidly developing, but because it has reached so many people, the ICTs in everyday life is at Stage 4 in urban areas and Stage 3 in rural areas.
• ICTs in the Workplace: Only 30% of the Chinese workforce has accessed the Internet at work. The Chinese usage at work for Internet for online banking, online trading, travel booking and online payment all fall below 22%. China is at a stage 3 for ICTs in the Workplace as computers are still not that commonplace. China is rapidly moving toward stage 4 and will likely reach that point soon as those that have been using the Internet at their homes start to move the technology to the workplace.

Network ECONOMY

• ICT Employment Opportunities: While the current state of the global economy has resulted is lost jobs, China is seeing a growth in the ICT services. ICT employment pays up to 3x the national average but compared to the rest of the global they are considered underpaid.
• B2C Electronic Commerce: Retail stores are seeing an increase in sales thanks to new business models, improved customer experiences, safety guarantees and a shift toward mobile platform development. There are an estimated 145 million in online shoppers with women slightly edging out men in numbers.
• B2B Electronic Commerce: China’s business-to-business electronic commerce sales continue to grow. While only comprising of 12.5% of all trade, B2B trade grew 26% in 2009. With the advent of secure online payment, increased transactions grew. Foreign investors teaming up with Chinese firms are opening the world to the Chinese Market. With the success of C2Cs, expansion to B2B & B2C with increase trade.
• E-Government:  The Chinese government recognizes the advantages technology like the Internet can provide for them. The benefits are numerous, from taking advantage of a new commercial portal to the further distribution of Party themes. However, the government is trying to balance the amount of liberty its citizens have with the Internet while controlling and not allowing for it to become a tool used against the government.

Network POLICY

• Telecommunications Regulation: Beginning with the establishment of telecommunication regulations in 2000. The Ministry of Information Industry supervises, regulates and passes judgment on the entire Chinese telecommunication industry. After joining the World Trade Organization 2002, China agreed to meet the WTO’s Telecommunication regulations. Delay tactics have kept the MII in control of which regulations to enforce. Foreign influences and activist are pressuring the Chinese government to meet the WTO regulations soon.
• ICT Trade Policy: the Ministry of Information Industry has set limits for foreign investors. Ownership of any telecommunication company by foreign investors within China must not exceed 49%. Foreign investors must team up with existing telecommunication firms if they wish to do business within china. They must also pay a $240 million registered capital requirement to partake in a joint venture. All these tactics keep China in control of telecommunications in China.

OFFSHORE OPPORTUNITY

• China only has 10% of the global market in offshoring, mainly in manufacturing. Another attractive feature is the lower average salary of Chinese IT workers compared to the rest of the world. However, the lack of skilled workers with strong English proficiency limits opportunities. Additionally, the government does not seem to respect intellectual property rights of companies.