China Online

Chinese are like Americans in one respect. More of them are spending more time online and more money while they are so.

And all the more so this year, according to a new annual survey for the semi-official Internet Society of China. It forecasts that there will be 244 million Chinese online by the end of this year, up from 182 million in 2006 — which would give China a larger web population than the U.S., though penetration rates remain much smaller (14% vs 70%+). The cross-over point in raw numbers is expected mid-year.

As in the U.S. internet usage is being driven by more widely available broadband. Online spending is forecast to increase to 581.5 billion yuan ($80 billion) this year, up from barely 300 billion yuan, with internet access fees, online shopping and online gaming the three main categories. Online travel booking is also growing fast as greater wealth makes Chinese more frequent tourists. The Beijing Olympics will also likely give it a boost in 2008.

Though there is no number given for total internet advertising in China, it accounted for 27.2% of the 12.4 billion yuan taken in by portals in 2007, up 22.3% from a year earlier and forecast to continue growing briskly, especially web video advertising.

The report also forecasts that online communities and e-commerce will become increasingly integrated in 2008, but says it will be tough for such sites to make money in the short-term. Just like in America.

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