Consumer China

Myspace and Facebook face the facts

  • Published 05 Mar 2009

Global leaders in online social networking are struggling to penetrate the Chinese market, where home-grown alternatives are simply more fun.

Several areas of China’s consumer market remain vigorous, and nowhere more so than online. BDA, a Beijing-based consultancy, predicts that the total number of internet users will grow to 389m by the end of this year, up from 298m at the end of 2008. Interestingly, online penetration in the big cities of Beijing and Shanghai is reaching 70% – about the same as the US average – though overall Chinese usage rates remain low by international standards, perhaps reaching 29% by the end of this year. Online games are gaining huge popularity, with BDA forecasting that revenues in this sector will grow by more than 30% to Rmb 25bn ($3.65bn, €2.9bn, £2.6bn) during the year. Online advertising, which grew at 53% during 2008 to be worth Rmb 18bn, is also set to remain robust, expanding at around 20% this year, BDA added.

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