4 Trends of the China Internet in 2019

Recently, South China Morning Post and Abacus News published the second annual internet report on China, the China Internet Report 2019. Following last year’s narrative, the report first provided an overview of the internet landscape with updates on the number of internet populations in China, comparing to in the United States. The total internet users have grown to 829 million in China, among which more than 98% of them are mobile internet users, comparing to 91% in the United States.

Followed by the overview section, which also listed the biggest internet companies and 2018 IPOs in China, the report summarized the top trends for 2019.

From the “Copycat” to the Pioneer

Super Apps

Global technology companies are now looking at China and trying to replicate the success some local companies have achieved. Started in China, the idea of Super App has been brought to the rest of the world. Two of the biggest Super Apps in China are WeChat and Alipay. The former, owned by Tencent started out as an instant messaging service, similar to WhatsApp, but has since become the one-stop shop for its users, from sending money to booking trips to paying utilities to playing games. Alipay, owned by Alibaba, is less of a social messaging app and more of a utility and money management Super App, including services like investing money, paying credit card, making currency exchange appointment and checking personal credit. The business model of Super Apps has influenced international companies such as Facebook from the United States, Line from Japan, and Go-Jek from Indonesia.

Short Video

Even though the concept of the short video did not begin its journey in China, the world was stormed by a short video application, TikTok, created by a Chinese company. With tons of filters and special effects, TikTok has turned short video concept into a success. Global companies such as Snapchat an Facebook are now including similar features that TikTok has into their applications.

Racing ahead with 5G

With more 5G patents than any other countries in the world and telecom operator already testing in a dozen cities covering more than 100 million total populations, China is best positioned to win the race to roll out 5G infrastructure.

Source: China Internet Report 2019, South China Morning Post & Abacus News

Thanks to the reduced latency and increased network capacity, the 5G technology will benefit a wide range of industries and has already been successfully tested transportation and healthcare: At Shanghai’s 2019 Auto Show, a driver is able to take the wheel and control a car in Beijing (that’s more than 600 miles away!) through 5G network with 10-millisecond delay and a doctor in a hospital was able to remove the liver on a laboratory rat at a remote location with only 0.1 seconds delay.

AI is Everywhere

China may not be the country with the most sophisticated AI technologies, but it is rolling out AI in many areas. The most widely-used AI technology is facial recognition, which has been heavily used in access control. Earlier this year, a subway station in Shenzhen city upgraded its paying system to include facial scanning equipment. “Commuters can scan their faces on a tablet-sized screen mounted on the entrance gate and have the fare automatically deducted from their linked accounts,” according to the China Internet Report 2019. In addition to facial recognition technologies, AI has also been used in smart home devices to provide a convenient lifestyle. According to the report, as of Q1 2019. China has surpassed the United States to become the number one country in global smart speaker shipments.

Source: China Internet Report 2019, South China Morning Post & Abacus News

A Unique Social Credit System

In 2014, China launched a project to give each of its citizens a social credit score. The system relies on a series of rewards and punishments meant to encourage people and businesses to abide by rules and to promote integrity and trustworthiness in society at large. Since the establishment of the system, tens of millions of people who have bad social credit have been banned to travel by air and high-speed railway and restricted to certain activities. Currently, the system is decentralized and lacks standards nationwide, and each province has its own rules on adding and deducting points from social credit. In some provinces, unlike in the United States where credit score is mostly determined based on people’s financial activities, citizen’s credit score can be impacted by social behaviors as well, in addition to their financial status. For example, if a driver runs a red light in the Jiangsu province, 50 points will be taken out from his/her social credit score.

As a company that specializes in internet services in China, we are always on top of what is going on in the country. Come back often to see what’s new!

P.S.: Here is the link to our summary of the China Internet Report 2018. The full China Internet Report 2019 is available here.