Is China slowing in its rush to the Internet?

A new report out from the China Internet Network Information Center says that, in the first half of 2014, China added fewer Internet users than any other time in the past eight years. 

People walk past a company logo at the headquarters of Alibaba Group in Hangzhou, in eastern China's Zhejiang province in this March 17, 2014 file photo.

The country with the largest Internet population may be slowing in its rush to the Web. 

That's the theme of a new report out from the government-linked China Internet Network Information Center (CNNIC), according to PCWorld. Although China had 632 million Internet users in June, the country added only 14.4 million new Internet users in the first half of 2014, the lowest growth rate for a half year in the past eight years, the report notes. 

The report says while China's total number of Internet users exceeds that of any other country, it struggles to bring online the roughly 450 million people who live in rural areas and reportedly feel little need to use the Internet. 

The number of Chinese Internet users logging on to social networking sites also declined by 7.4 percent in the past six months, falling to 257 million in the past half year, the report notes. 

This abatement in the growth of Internet users follows a decade of near constant growth in Chinese Internet usage, even though the growth rate has fluctuated over the years. For example, between 2008 and 2009, the number of Chinese Internet users increased by more than 50 percent while that number increased by only 9 percent between 2009 and 2010, according to numbers provided by Internet World Stats

But while China's overall increase in Internet penetration might be moving at a slower rate, the country has reached a milestone in a different area: mobile Internet usage. The report says that June saw China's number of mobile online users climb to 527 million, overtaking PCs as the most popular means of accessing the Internet. 

Global smart phone shipments are expected to reach 1.2 billion units in 2014, a 23.1 percent increase from the 1 billion units shipped in 2013, according to market research firm IDC, which notes that Apple's entry into China will mark an important development of the smart phone market. Total volumes of smart phones are expected to reach 1.8 billion units by 2018, with China accounting for almost one third of all smart phone shipments in 2018.

This comes at a time when China is trying to promote its Internet services as a major export product. An article published Monday by China's state-run Xinhua News Agency urged more Chinese Internet companies to compete internationally "as they now have the capacity to provide services outside the country." 

That article cited the Chinese president Xi Jinping's recent trip to Brazil, which saw the launch of the Portuguese version of China's search engine, Baidu. 

"Not only, but also, and other websites, have won abundant users in China and other countries that are home to Chinese speakers," the article states. " and are among the world's top B2B and B2C/C2C platforms in terms of trading volume and number of clients." 

The article says that Chinese Internet services moving abroad can have "strategic significance" because "search engines are highly monopolized by a few websites," notably American companies such as Google and Yahoo. Moreover, the article notes, breaking this "information monopoly" and building a "fairer and safer cyberspace" are pressing needs of the international community in the wake of security concerns revealed last year by US National Security Agency contractor Edward Snowden. While the article says that international concerns over American Internet companies have provided opportunities for Chinese Internet companies, it does not give any solutions Chinese companies can provide to assuage security concerns. 

Earlier this month, Chinese Central Television, a Chinese state media organization, accused a feature on the Apple iPhone of posing a national security threat. Although Chinese media subsequently tempered this accusation, it provided a microcosm of the tensions faced by US technology companies operating in China, in the wake of Mr. Snowden's revelations.

"U.S. companies including Apple, Microsoft, Google, Facebook, etc. are all coordinating with the PRISM program to monitor China," official Chinese media reported in June, referencing one of the NSA spying programs revealed by Snowden. 

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