Chinese government has claim now it has 557M mobile Internet user

The China Internet Network Information Center (CNNIC), a government organization, has
released its latest report on Internet usage (link via Google Translate). It claims mobile Internet users reached 557 million as of
December 2014, a growth of 11.4 percent from the year before.

It’s important to note that the CNNIC’s report does not break down mobile user by SIM cards, which may skew its findings because
dual-SIM phones are popular in China.

The figures, however, underscores China’s importance to hardware manufacturers as the world’s largest smartphone market, as borne
out by Apple’s latest earnings report and Xiaomi’s relatively quick ascendancy.

Overall, there were a total of 649 million Internet users in the country, marking a steady five percent increase from last year.

This brings China’s Internet penetration rate to 47.9 percent.

In terms of apps, mobile games and
messaging apps like WeChat remain highly popular. In fact, 90.6 percent of mobile users now use a messaging app, said the CNNIC.

Mobile travel bookings were the fastest- growing app category, however, with a 194.6 percent increase in usage last year.

Other types of apps that did well include mobile payment and mobile banking, which is good news for companies like Alibaba and
Tencent that have taken advantage of shifting regulations and China’s attempts at financial reform to launch private online banks.

Use of mobile payment apps grew 73.2 percent, while mobile banking apps grew by 69.2 percent.

Good news for China’s Internet giants include increasing adoption of online-to-offine services (O2O).

The CNNIC found that 39.2 percent of consumers in the country’s biggest cities, including Beijing, Shanghai, Guangzhou, and Shenzhen, used O2O services last year, and the number is also steadily increasing in “second- and third-tier,” or smaller, cities is also gradually increasing.

O2O is an important part of Alibaba and Tencent’s strategy as they seek to squeeze more sales out of their existing network of online users.

The report did note, however, that O2O markets for food (including delivery services) and leisure activities (such as movie ticket
orders) appeared to be maturing, while medical and household O2O services have more potential for growth.