Archive for Sunday, January 26, 2003

China’s Web economy booming

January 26, 2003

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— China will soon become the world's largest Internet and information economy, surpassing the United States, the president of one of the Chinese government's two main telecommunications companies predicted Saturday.

By 2008, China will have between 200 million and 300 million Internet devices and millions more users, said Edward Tian, China Netcom Corp.'s chief executive and a pioneer of the country's Internet revolution.

He spoke at a panel on "China's Rise: Regional and Global Impacts" at the World Economic Forum in this snow-covered Swiss Alpine resort, an annual meeting of top business and government leaders who have singled out China as one of the few economic success stories in the past year.

In China, Internet use has grown from a few thousand seven years ago to more than 60 million today, putting China ahead of Japan and only second to the United States, which has about 200 million users.

"China can soon become the world's largest Internet and information economy, in both telecommunications and the traditional IT (information technology) sectors," he said.

Last year, China was the only country where information technology continued to grow and it has become a key market for Western technology companies -- No. 1 for Nokia, and No. 2 for Ericsson and IBM, he said. China was also the only country to see growth for the telecom equipment market in 2002.

"In the past 10 years, most investment has been in hardware to build infrastructures, fiber networks," said Tian, whose company bought key undersea fiber-optic networks in November from Asia Global Crossing Ltd., which filed for bankruptcy to facilitate the sale.

"In the next five to 10 years, I think investment will focus ... more to the software side and service sector," he said.

China's economy grew by more than 8 percent last year, and panel members predicted continued growth.

"I don't think China can build an economy if we just rely on manufactured goods. We must play a very important role -- a leading role in the technology side," Tian said.

He predicted that "the Internet will transform not only the new economy but the traditional economy."

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