On The Phone, Online…and Secure (with Chinese Characteristics)

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The Ministry of Information Industry (MII) has announced that it expects the number of mobile phone users in China to reach 441 million this year (34 percent penetration), up from 400 million in 2005 – although some commentators (including China Herald http://www.chinaherald.net) have noted that a lot of defunct accounts are included in this number.

By contrast, fixed line phone users may grow to just 380 million (29 percent penetration). MII noted that telecoms growth should continue at over 20 percent in 2006, with a turnover value of RMB1.44 trillion and revenue of RMB639 billion (up10.2 percent).

Meanwhile, the number of internet users is expected to reach 128 million, up from 111 million in 2005. These netizens, and international businesses that benefit from open, cheap and easy communications with China, may have been worried to see reports that China might start using its own top-level, Chinese-character, domain names in its own national intranet. However, the China Internet Network information Centre (CNNIC) [http://www.cniic.cn/] was reported to have said this is not the case, and that the report was actually only related to the use of .cn domain extensions rather than .com etc. Nevertheless, that is probably an issue to watch and, in any case, points to a need for more in the way of Chinese language services in the realm of domains.

While China may not yet be developing its own internet, there is a continuing trend towards the development Chinese standards in technology, or “independent innovation”, and a reduction in reliance on foreign suppliers. In the latest (officially-backed) move a group of over 20 Chinese companies has set up the WAPI Industrial Alliance to promote the Chinese-developed WAPI encryption standard for wireless local network (WLAN) equipment.

The Chinese grouop includes 22 companies including: Founder Group, Lenovo, Hisense, Haier, Huawei Technologies, Datang Mobile and Datang Microelectronics Technology. It is noted that some foreign companies, including Conexant Broadband Communications of the US, may also join the group.
Similar moves towards local standards have also been seen in the 3G market.

With the continuing development of R&D in China, and China’s position as the lading exporter of high-tech goods (as reported recently in this blog), we can expect more moves of this kind – as well as more protectionist arguments from pressured western competitors in Europe and the US.

See related news:

    China’s cell phone users to exceed 440 mln, Internet users, nearly …
    Xinhua – China
    28 (Xinhuanet) — China’s cell phone users will reach 441 million in 2006 while Internet users is expected to be 128 million, said an official with the …

    CNNIC: China Will Not Break Away From Global Internet
    ChinaTechNews.com, China – Mar 5, 2006
    In response to foreign media reports that China might create its own top-level domain names to create its own intranet, a spokesperson from the China Internet …

    China challenges US control of Internet addresses
    Toronto Star, Canada – 21 hours ago
    There was a buzz in the Internet community last week after the People’s Daily, regarded as the most influential newspaper in China, published an article in …

    China pushes forward own encryption standard
    People’s Daily Online – Beijing,China
    … And that might revive the WAPI tussle between China and the United States, the most serious high-tech trade dispute between the two countries in recent years. …

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