Internet & Tech

Caught in the net

Is China being changed by the internet, or is it changing the web?

One of the most striking end-of-year numbers on offer from the Chinese statisticians was the update on the number of internet users in the country. As of the end of November it was 420 million, and counting. Yes, you’d expect it to be a large group, given the population size. But it is still advancing quicker than most – more than five times the number for India, for instance.

China is also embracing the internet in a very different way from other countries. That is in large part the result of the government’s traditionally controlling approach towards information and entertainment. The country’s Great Firewall exerts sweeping control over the internet, employing both technical and human censors to monitor internet traffic and shut down offending material. It also restricts access to a range of foreign content, such as Facebook and YouTube.

Companies that don’t comply are asked to leave. Earlier this year that meant much hullabaloo when Google, the search giant, withdrew from China after refusing to continue to allow its search engine results to be censored. Beijing’s stance quickly prompted an emotive outcry about internet freedoms. The ensuing compromise was more pragmatic than principled: Google routed its search engine through the company’s Hong Kong site. The searches themselves aren’t censored for mainland users, but the firewall ensures that the results can be. (Still, a victory of sorts for Sergei Brin and friends, who can reasonably argue that Google isn’t doing the censoring. The downside: the extra click means that Google’s share of searches has fallen dramatically).

The Great Firewall is not infallible. Domestic microblogs (Twitter-equivalents) sometimes employ homonyms for the names of sensitive subjects, or use abbreviations in Latin characters. Han Han, China’s most widely read blogger, also seems less fettered than most (see WiC71). His critical take on political and social issues can be devastating, even if carefully framed. But censors have so far left him alone; critics say his high-profile status protects him because Beijing is worried about the reaction that a shutdown might trigger.

The internet can also act as a brake on official abuses of power, often taking on subjects the mainsteam media dare not touch. One of the most publicised examples occurred in 2008 when a blogger posted pictures of a Nanjing city official wearing a $14,500 Vacheron Constantin watch and smoking $22-a-pack cigarettes, evidence of a lifestyle well beyond his means (see WiC7). The pictures caused a furious backlash. A week later, the official was sacked.

Similarly, in WiC18 we reported the story of Deng Yujiao, a 21 year-old waitress who fatally stabbed a Party official attempting to rape her. Deng was arrested for manslaughter until a blogger publicised her case on the internet. The case quickly generated intense interest from netizens. Under public pressure, a Hubei court released Deng and later dropped her case. It’s not the sort of justice Westerners are accustomed to – more a case of jury by broadband.

The leaders in Beijing obviously have mixed feelings about the internet. Exposing the wrongdoing of local bureaucrats is a plus if it reduces individual cases of corruption. But repeat exposure raises questions about the system itself, and those governing it.

But the government does have reason to like one aspect of the web: it’s good for business. China’s growing internet culture has also led to a thriving e-commerce market. One in four of China’s internet users shop online, says the China Internet Network Information Centre. Online sales increased by 117% last year to $39 billion, according to Beijing-based consultancy iResearch.

Taobao, a unit of Chinese internet giant Alibaba Group, was one of the first to capitalise on the trend (see issue 47). Today, as much as 78% of online sales in China by value now go through its site, which started as a consumer-to-consumer platform but has recently moved into traditional online retailing. On November 11 Taobao had a ‘bargain’ day: 21 million shoppers made purchases.

Alibaba, of course, is one of the internet giants, along with Baidu (search) and Tencent (messaging and games) that dominate China’s web. Unlike the rest of the world, Silicon Valley’s star firms don’t get a look-in.


© ChinTell Ltd. All rights reserved.

Exclusively sponsored by HSBC.

The Week in China website and the weekly magazine publications are owned and maintained by ChinTell Limited, Hong Kong. Neither HSBC nor any member of the HSBC group of companies ("HSBC") endorses the contents and/or is involved in selecting, creating or editing the contents of the Week in China website or the Week in China magazine. The views expressed in these publications are solely the views of ChinTell Limited and do not necessarily reflect the views or investment ideas of HSBC. No responsibility will therefore be assumed by HSBC for the contents of these publications or for the errors or omissions therein.