Every blog needs its Google China post - here it is

[Update: German Version of this available at Kooptech ]

Everybody is talking about cyber attacks and Google and Don't be Evil and Censorship and Internet Imperialism. It is more than difficult to decide which position to dislike more. But I don't need to decide, fortunately, I just need to opinionate on what's going on.

In general terms, the US has replaced China as the main originator of malware (phishing, viruses, botnets...), as the latest report by security company Sophos has indicated (summary here http://www.sophos.com/pressoffice/news/articles/2009/07/threat-report.html, full report here http://www.sophos.com/sophos/docs/eng/papers/sophos-security-threat-report-jul-2009-na-wpus.pdf). Back in 2007, more than 50 per cent of malware was from China, now almost 40 from the US. The recent attack against Google that was directed at selected Gmail accounts and that exploited a weakness in the Adobe Acrobat Reader, on the other side, was apparently clearly originating in China, from what I hear in the news media.

You may remember that in March 2009 there was a furor about the Chinese "Ghostnet". Files from foreign embassies, ministries and computers of the tibtan exile leaders were stolen or corrupted. Computers were hijacked and the microphones and cameras used to spy on its owners. The immediate source of this ghostnet seemed to be China, but there was a tendency to word this in a careful way in order not to stir up what now has bee stirred up: while the attacks came from China, there was of course the possibility that these Chinese computers were themselves only a botnet, hijacked and directed from another location.

The U.S.-China Economic and Security Review Commission has actually published a report on this. Summary on this page http://www.uscc.gov/researchpapers/papers.php ("CHINESE CYBER WARFARE & ESPIONAGE").

In 2007, after the German security services had published a report revealing that spy programmes (hidden as PPT and .doc files) found on ministry computers could be traced back to China, the Chinese government reject all those assertion rigidly and created some bad mood before a meeting between the Chinese and German governments. In general, the Chinese government strongly denies all allegations of being involved in such campaigns. And at the moment it is actually turning around, with all the English language papers claiming that it is China that is primary victim of cyber crime and cyber warfare. (Global Times and China Daily of today and yesterday I think).

The overall assessment is ... well: No doubt that in a highly competitive world economy, many players will pull all stops and use all means available. In the case of China there are some tricky bits about this. There is great ambivalence of the Chinese government towards the Internet (a source of wealth and development vs a source of unrest and uncontrollability). As in many governments, there are some people in place with a very deep ignorance with respect to all things information society (in terms of technology and social impact). The deep entanglement of the government in the whole economy, and in all the relevant businesses, makes it appear highly likely that a concerted attack originating from China will have run through government one way or the other. Some attacks, it was alleged, could even be traced back to PLA computers. And given the apparent deep level of intervention into net affairs, it strikes as a strange case of leadership insecurity that nobody has the guts to just say "We protect our society by censoring the web. Full Stop." Instead, oddly nonsensical statements frequently come out (http://news.cnet.com/2100-1028_3-6130970.html " In China, we don't have software blocking Internet sites. Sometimes we have trouble accessing them. But that's a different problem.") that put in doubt the ability to really deal with that strange beast called information society.

The sad side to all this, of course, is that nobody who knows anything about it talks about it, and that a lot of people who know nothing about it talk an awful lot (yes, of course, I am guilty as charged by myself…). Has Google used this as a semi-elegant exit strategy? Maybe. Or did it behave the way you learn it on the Chinese silk markets, haggling by threat of exit ("I am going now, really, I am going if you do not give this away cheaper, now, I am going, really! Now, soon I am away, see me going away...?"). It certainly feels like it (low market share, lower revenues and all, plus some nice political backing and a return to "don't be evil" reputation - where's the peril...). And when will the Chinese government ever produce transparent laws that clearly state what is legal and illegal to distribute through media networks? That can be a reliable foundation for any commercial or non-commercial business and challenged at court? Without these transparent regulations, the internet is easier to control. With them, China would have a more useful net and would be a more credible international player in politcis at-large.

As in real life, so also in information society: all short answers are wrong...

Admin note: old Newsletters of Information Society Project deleted

In the interest of resource saving (webspace, mainly), I have deleted the old newsletters of the EU-China Information Society Project from this blog's download section. Some links in old posts will therefore be dead. If you are still interested in the newsletters, let me know through the comment section. I can make them available directly.

Newsletter EU-China Information Society Project

The Eu-China Information Society Project's latest Newsletter titled "What's Coming Up in 2009" is now available for download from this website.
"What's coming up in 2009"(PDF 1.3 MB)

Here are the links to some past newsletters:
"Convergence" (PDF 1.8 MB)
"e-Inclusion" (PDF, 1.7 MB)
"E-Commerce Edition" (PDF, 1.4 MB)
"Information Security Edition (PDF, 1.7 MB)

3d Internet Workshop documentation

During a workshop on March 13, the EU-China Information Society Project presented an overview over the status quo, trends, developments and challenges in the area of the "3D Internet". The speakers covered technological, business and policy challenges in a one-day seminar, with speakers from Europe and China introducing their respective perspectives. Three companies introduced their respective approaches to 3D worlds through snapshot presentations of their products. As an overview input to the workshop, the project had commissioned "From Virtual Worlds to the 3D Web", a brochure prepared by +8* (see their own description here). The English versions of the workshop presentations, agenda and the brochure can be downloaded here (.RAR, 13 MB). For the Chinese versions and any questions, contact Thomas Hart at thomas(at)information-society.de.

Exciting newspaper news

Very rarely do the Chinese newspapers get me excited, but here it is, the case of a proofreader who deserves a medal of good taste, brought to us via Chinadigitaltimes and The Times:

"[A]… proofreader and typesetter at the outspoken Southern Metropolis Daily have been fined for an article that went a step too far – even for one of the few newspapers in China willing on occasion to challenge the censors.
The proofreader was outraged when he was presented with a story from a junior reporter that fell into line with the mainstream newspapers that lavish praise on the activities of Communist Party officials.
He described in flattering terms how a local party leader in southern Shenzhen had celebrated the Chinese New Year making dumplings with a group of migrant labourers. In his final paragraph, he wrote: “Since they have never dined with such a senior-level leader before, all the migrant workers were all very excited to see such a great leader.”
[…] Once typeset, the proofreader was so disgusted by the phrase that he circled it and made the annotation: “Such arse-kissing!” He felt that the traditional propaganda tone was not in keeping with the policy of one of China’s most hard-hitting newspapers.
However, the typesetter did not realise what the phrase meant and simply added it into the reporter’s copy and sent the newspaper off to be printed. Thus the January 22 edition of the newspaper carried the line reading: “Such arse-kissing really makes me excited.”

Unfortunatetely, later in the same article I learned that the very romantic story of the rich jerk who wanted to cut down on mistresses and exposed them to a tv-style "Chinese Idol"-like contest, ending in a Shakesperean tragedy, was just that: Shakesperean, i.e. fiction. Dammit! Was a good story, though.

A scan of the newspaper page including the wise man's comment can be found here.

Here there be culture!

Wittertainment at its most wittertaining, this time from Imagethief on the ever-fascinating topic of governmentally conceived culture:
As the Beijing Municipal People's Political Consultative Conference announced that they had conceived a big-scale blockbuster flick about the Birth of a Nation (something like that, in any case), the approporiate comment comes in:
"… nothing says, Aaargh! My eyes! like "Conceived by the Beijing Municipal People's Political Consultative Conference." This, in a nutshell, is every single thing that's wrong with Chinese popular culture --especially the film industry-- distilled down to it's purest essence in nine bone chilling words. The BMPPCC should conceive statues. It should conceive statutes. It should conceive worthy initiatives to get healthy meals to schoolchildren and it should conceive improved traffic laws. But it should conceive motion pictures like I should conceive a two-headed goat child."
Imagethief goes on to suggest that the picture should be helmed by Michael Bay instead of Huang Jianxin and replace a politics whore with a money whore. Bay being the anti-christ, this will not happen, of course, as it would cause religious turmoil. I think the idea of showing 'em how it's done is pretty good, though, and suggest to ask Trey Parker and Matt Stone to go for the big screen again.

Flesh, beware!

This is not the place to discuss the phenomenon of "human flesh searches" in detail and theory (see e.g. Orchis Tower for a bit more and see a regular Google search for much more). Yet, when reading about a new legislative proposal to protect citizens against online vigilantes (a very accurate term in that context, I think), what occurred to me is that this is only another example of the strange moral code that can be observed in online environments in general, but a bit more extreme in Chinese contexts. The extent to which a considerable group of Chinese "Netizens" (and if somebody could define that term for me sometime? Thanks!) consider themselves to be above the laws and regulations, able to set and execute their own codes, is quite a bit bigger than in other environments. Not only does it happen frequently that online mobs collaborate to identify an alleged ill-doer (in order to - say - hand over the details to the authorities in charge of investigating kitten-murder). In most cases, research, result and punishment and all part of the same action plan: Who did wrong needs to be punished, and we are here to punish. While at it, we define what "wrong" means.

This whole flesh search phenomenon I do find increasingly creepy, and for once I may voice my appreciation of government departments having the same ideas about it (I believe, never try to read government's mind!). The way vigilant groups set out to destroy individual's existences based on a vague, self-defined notion of truth and justice is scary and appalling. Particulary prominent and telling example: the husband supposedly cheated on his wife, she supposedly killed herself because of it, the online mob sought to punish the husband / widower by publishing all his personal information and distributing it all over the tabloids. Did his wrong extend beyond the reach of his inner family life? I suppose all Chinese laws would say "no". If his wrong was to cheat on his wife (I am sure her killing herself was not his intention), why not publish all cheating Chinese husbands' names and addresses? Server capacity limitations? If his wrong was to have cheated on a wife who then decided to kill herself, then how does that make a difference in terms of his violation of whatever code?

This strange detachment from socially accepted and implemented rules and regulations (e.g. in laws) might have to do with the fact that the WWW has been shaped among a very specific group in the past, with a certain cultural and moral background and certain resulting values that become knitted into the fabric of the online world (the cute things such as the "netiquette disclaimers" still to be found on many websites are residual of this). One element of this was to establish that the ethical code of the Internet may be quite dissimilar of the code used in the offline world. Resulting from the fact that many Internet-related processes by nature are trans-national - or non-national, from a certain perspective - there was a very early perception that the regulatory environment for the online world needs to be a different one from the offline world. Specifically the question then is whether to adjust the offline provisions to cover online phenomena as well (e.g. by covering theft between Second Life avatars through regular criminal law), or to create some set of online regulations dedicated to the specifics of the networked world.

While this debate is tricky enough on various levels, it does not get easier with the wake of self-regulation - self-regulation, that tis, through an informal group of online users not attached to any kind of legitimate body. Self-regulation as co-regulation in a Western sense would mean handing over tasks to entitites outside government, to relief public sector from tasks that can easily (or at least better in some form of definition) be conducted through industry or users. But who has handed over the flesh search authority? Can I sue them if they do not take action against a villain? Is a policing force not always (whether this is liked or not) very closely bound in their actions by clear provisions on when they have to act (when observing a crime) and when not?

I am hesitant to see this observation linked to other instances where Chinese citizens are more comfortable with handling issues and arguments on their own as opposed to handing them over to the authorities, as it may mean I would have to judge on the general level of trust between public and private sector in China as opposed to other regions. But maybe it is worth analysing it more in-depth some other time where these observations lead to, and how they can be made productive for the creation of a proper system of co-regulation with citizens acting in accordance with laws, and sharing the responsibilities with government and police in an organised way. Some other time, though.

UDP and TCP and uTorrent melting down the Web

Someone is calling fire, and that someone is Richard Bennett ("a network architect and occasional activist in Silicon Valley"). In his story on "The Next Internet Meltdown", explains how the developers of the uTorrent P2P client have changed their design (they make the UDP protocol the default transport protocol for file transfers, not just tracker communication), why (to circumvent TCP traffic limitations) and to what effect:

"By most estimates, P2P accounts for close to half of internet traffic today. When this traffic is immune to congestion control, the remaining half will stumble along at roughly a quarter of the bandwidth it has available today: half the raw bandwidth, used with half efficiency, by 95% of internet users. Oops."

His suggestion:
"The best way to ensure that uTP doesn’t kill the internet is to throttle it at the source, and any law that stands in the way of ISPs exercising that level of management is deadly to the internet. We can thank the uTorrent developers for reminding us of that salient fact."

Full article here: http://www.theregister.co.uk/2008/12/01/richard_bennett_utorrent_udp/

UPDATE Dec 08: Another Register story here

The EU-China Information Society Project's latest Newsletter is now available for download from this website. It has the focus topic of "Emergency Response", featuring the proejct's Chengdu activities. It is following the "Convergence" issue published in July and has been compiled to provide an overview over past and future project events as well as the experts involved.
Here are the links to all the past newsletters:
October 2008: "Emergency Reponse" (PDF 2 MB)

Previous editions:
July 2008: "Convergence" (PDF 1.8 MB)
April 2008: "e-Inclusion" (PDF, 1.7 MB)
"E-Commerce Edition" (PDF, 1.4 MB)
"Information Security Edition (PDF, 1.7 MB)

Brave New World of Digital Intimacy - New York Times

Brilliant New York Times Magazine overview over the mechanisms, social effects and impact of social networking tools. Well worth investing half an hour and reflecting on one's own behaviour!

Digital Outlook 2008

Two nice postings on Kaiser Kuo's Digitalwatch blog, reposting an article by Chris Reitermann (and I keep memorising Jason Reitman, but that is the director of "Juno", right?) providing his Outlook for 2008.
Part 1 here and part 2 here

China Law Could Impede Microsoft Deal for Yahoo

The New York Times gives us this:

China Law Could Impede Microsoft Deal for Yahoo
By JOHN MARKOFF
Published: March 28, 2008

SAN FRANCISCO - Microsoft's hostile-takeover attempt against Yahoo may
encounter an unexpected hurdle in August after a Chinese antimonopoly law
takes effect that will extend the nation's economic influence far beyond its
borders.

The law, which goes into effect on Aug. 1, is intended to strengthen an
existing set of antitrust regulations the Chinese originally established in
1993. It will make China a third sphere of regulatory influence, matching
the power of the European Union and the United States, according to legal
specialists in this country and in China who have studied it.

Full story here

China Boosts Most Internet Users

Couple of days old, but now officially China seems to have the largest
Internet user community, see here.

China has more Internet users than any other country, the Wall Street
Journal reports
The paper estimates that there are 228.5 million Internet users compared to
217.1 million in America:

BDA estimates that China's online advertising market reached $1.3
billion in revenue in 2007, while U.S. Internet ad spending was expected to
reach $21.4 billion in the same period, according to New York-based research
company eMarketer Inc. Although the two numbers aren't directly comparable,
analysts agree the disparity of the ratios of user numbers to advertising
dollars is vast.

Liu Bin, an analyst at BDA, says the Internet makes up only about 5%
of advertising spending in China, compared with 10% in the U.S. But if
China's economy continues to grow and China's Internet users increasingly
choose the Internet over traditional forms of entertainment, China is bound
to catch up.

The story at ChinaDigital Times contains also reference to the shutting or
not shutting down or up of Tudou

Politische Kommunikation in China, Schnupperkurs erbeten -

Sorry, German only, as the sketch was initially drafted for another, German-language blog of mine. This one at the German Financial Times site: http://www.ftd.de/beijing888

Es ist ganz einfach (und ich schreibe das jetzt auch nicht für die ganzen Medienexperten, von denen es in der hiesigen Online-Leserschaft genug geben wird, falls es denn überhaupt eine Online-Leserschaft gibt. Eher so für den interessierten Sport-Leser, der sich verlaufen hat und dachte, hier seien Olympische Spiele drin, nur weil das drauf steht): Der Vorteil einer frei berichtenden Presse ist, dass man in der Summe ein möglichst umfassendes Bild der Realität erhält. Dies erfordert Intelligenz vom Mediennutzer mehr als vom Medienschaffenden, denn jeder noch so dumme oder dämliche Beitrag wird bald seine Gegenposition finden, vorausgesetzt die Sache ist wichtig genug. Die Summe all der gut und schlecht, ausgewogen und tendenziös, von Partikularinteressen gesteuerten und nutzergeneriert formulierten Medienberichte ermöglicht dann letztlich die Wahrnehmung von Wahrheit. Wenn man zu lange die deutsche Rundfunkdebatte studiert hat, nennt man das Außenpluralismus, andernfalls ganz einfach Meinungsvielfalt. Es funktioniert nirgends richtig, aber immer noch besser als alles andere. So wie Demokratie eben.

Wahrheit durch Vielfalt herzustellen erfordert Vertrauen in die Medienkonsumenten. Misstraut man den Bürgern und fürchtet, die Vielfalt an frei gesammelter und aufbereiteter Information führe nicht zur Herausbildung informierter und ausgewogener Meinung; angenommen, man fürchtet, diese Informationsflut führe entweder zur geistigen Kapitulation und zum inneren Abschalten - oder zum Deklarieren der nächstbesten Meinung als Wahrheit - dann ist es eine gute Idee, ein Paket an Maßnahmen schnüren, um das zu verhindern: Das Schulen in Medienkompetenz wäre in einem solchen Paket gut aufgehoben, auch das Fördern von Qualitätsmedien, die sich kritisch äußern auf der Grundlage ordentlicher Recherche. Das wäre eine recht modernes Paket voller Herausforderungen, und vermutlich könnte man mit Nachsicht außenstehender Beobachter rechnen, wenn gleichzeitig ein wenig intensivere Übergangssteuerung dafür sorgen würde, dass man so lange wie möglich die Kontrolle über den Prozess behält. Man würde es nicht verübeln, so wie man dem japanischen MITI seinen starken Steuerungseingriff zum Aufbau der Automobilbranche nachgesehen hat. Übergangsstadien eben, mit hoher Absolutionsbereitschaft, denn guter Wille ist das Wichtigste.

Mal eben die tiefergehende Analyse anhand der verschiedenen medienpolitischen Maßnahmen überspringend, lautet meine Einschätzung für China dazu: Hier gibt es das Vertrauen in die Lernbereitschaft der Bürger noch nicht. Deshalb glauben die Verwalter in Beijing, die über den zuzulassenden Informationsfluss zu befinden haben, es sei notwendig, sehr viele Mediennutzungsentscheidungen vorab zu treffen, anstatt sie dem Individuum zu überlassen. Welche Nachrichten zu finden sind, wird über die Entscheidung, wer Nachrichten anbieten darf, ebenso kontrolliert wie über zahlreiche ad-hoc-Entscheidungen dazu, welche Meldungen täglich in welcher Form (nicht) präsentiert werden können. Die extrem unterschiedliche Regulierung chinesischsprachiger und internationaler Medieninhalte oder das Sperren gegen Instrumente, die die Autorität der Auswahl an den Nutzer geben (wie ein Altersklassifikationssystem für Medieninhalte) sind Symbole dafür.

Diese Maßnahmen werden aber nicht als Sicherheitsnetze für einen wie auch immer definirten Übergang eingesetzt. Es ist kein Weg sichtbar, der die Bürger dahin bringt, selbst zu kompetenteren Entscheidern über ihre Informationsinhalte zu werden. Weder wird an der Vielfalt der Medieninhalte gearbeitet, noch am Schulen der Menschen in Sachen Informationsbeurteilung und -einordnung. Schlau ist das nicht, und möglicherweise ist es auch nicht politischem Plan, sondern Kader-Reflex geschuldet. Das Ausweisen von Journalisten aus Regionen, in denen es nun tatsächlich Berichtenswertes und Bedarf an authentischer Beobachtung und Beurteilung gibt, ist unklug. Genauso unklug (und was für ein dramatisches Zeichen der Unerfahrenheit!) ist es, erst alles in die Wege zu leiten, um ein paar zehntausend Journalisten ins Land zu bekommen, um die Mechanismen der internationalen Medien dazu zu nutzen, um den erreichten Status und das neue China zu präsentieren - um genau diesen Medien-Mechanismen dann alles denkbare Futter zu geben, um zu beweisen, dass sehr viel mehr als gedacht sich seit ein paar Jahrhunderten eben nicht geändert hat.

Dieser Blog-Eintrag dreht sich nicht um Tibet oder um Olympia, sondern um Politische Kommunikation. Genauer um die schier unglaublichen Pfuscherei, die die vergangenen Monate (mit den Themen Dafur, Spielzeug, Olympia, Tibet - es gab reichlich Kommunikationsmaterial) zu Tage gefördert haben - wenn man diese Kommunikation aus westlicher Sicht interpretiert!

Was würde man denn erwarten? Dass der Vize-Gouverneur der Provinz Tibet sich mit den Medien hinsetzt und ihnen den Kopf wäscht, wie sie glauben können, seine Interventionspolitik sei nicht zum Besten der Provinz und des Landes, und dann erläutert, wie viel schlechter es um aller Interessen stünde, hätte man anders gehandelt. Im Grundkurs politische Kommunikation, spätestens Proseminar Krisenkommunikation, lernt man das so: Habe eine Geschichte parat, bevor Du handelst, und haue sie jedem um die Ohren, der meint, er kenne Deine Situation besser als Du selbst. Macht man das nicht, sondern laviert und sperrt, spielt mit BBC und CNN ein albernes Anschalt-Abschalt-Spiel und erklärt ausländischen Reportern, wo sie stehen dürfen und wo nicht, dann sendet man eine etwas andere Botschaft als man möchte: Was wir tun, lässt sich nicht auf Grundlage unserer klar formulierten und auf langer Erfahrung basierender Position zum Thema "Umgang mit Minderheiten und separatistischen Tendenzen" erklären. Wir haben einfach gerade keinen Schimmer, wie wir mit der Situation umgehen sollen. Deshalb machen wir das wie immer. Wir sagen, dass wir Recht haben und jeder andere es nicht beurteilen kann. Außerdem ist jedes ausländische Medium, das behauptet, es gebe ein Problem in China, tendenziös. Damit Ihr's nur wisst!

Keine Erklärung für das eigene Handeln zu haben, und statt dessen ein paar tausend Kilometer Distanz zwischen die Fakten und deren Berichterstatter zu legen, deutet zudem an: Uns ist das alles peinlich. Und nicht ein bisschen, sondern arg. Am Ärgsten ist, dass wir uns so sehr ärgern, dass wir so viel auf ausländische Meinungen geben wie noch nie in unserer Geschichte. Wir würden uns gerne souveräner im internationalen Umfeld bewegen, aber außer beleidigte Leberwurst mit 5000 Jahren Praxis haben wir in Sachen politische Kommunikation noch nicht viel gelernt. Dieses Schema nutzt sich selbst beim toleranteren Gegenüber schnell ab.

Es gibt ein chinesisches Sprichwort, das lautet übersetzt: Ob der Sprecher in das Gesagte Bedeutung legen wollte, ist nicht entscheidend. Entscheidend ist, ob der Hörende Bedeutung hinein interpretiert. Da sollten sie mal öfter auf den Volksmund hören, die Sager und Nicht-Sager. Nur mal öfter genauer hinhören, was sie selbst sagen.

China's Web users leave US behind (Shanghai Daily)

and another quick update on recent facts and figures:

China's Web users leave US behind
By Nicholas Ning 2008-1-9 Read the full story at Shanghai Daily
CHINESE Web users will spend 45.8 percent more this year on online games and booking hotel and flight tickets, among other services available online, as China overtakes the United States to become the world's largest Internet market by Web population size.

Total spending by Chinese Internet users will hit 581.5 billion yuan (US$77.53 billion), while the Web population will hit 244 million by the end of 2008 from last year's 182 million, an increase of 34 percent, said an Internet Society of China report issued yesterday.

Of last year's spending, the bulk was for Internet access fees and online shopping, while only a small percentage of users paid for services such as online music, video and anti-virus software, the report, titled Netguide 2008, showed. The spending figures don't include online advertising.

The report's findings are based on data collected from a survey of 50,786 mainland Internet users and 270 companies across the country, as well as from seminars and interviews with industry experts.

The monthly spend per Web user last year was 182.6 yuan, and ISC predicts a 8.8 percent growth for each Web user this year.

Online game, ranking third most paid-for service per Web user last year, is expected to bring the game companies a total of 13 billion yuan in sales this year, 39 percent more than last year, as the number of gamers expands by 11 million to 59 million.

Hu Yanping, chief of the government-back ISC's development & communication center, estimated that the total Web population will outnumber that of the US as early as June, as broadband penetration grew.

The US had about 210 million Web users by December, with a Internet penetration rate of more than 70 percent. China's December figure was 13.8 percent.

Among other rapidly growing sectors, online travel registered a 65.4 percent growth over 2006 last year to reach 2.25 billion yuan as more and more travelers are using the Internet to book hotels and air tickets.

Search-related ads generated sales of 2.87 billion yuan last year, a whopping 82.8 percent year-on-year growth. It should continue to grow at 81 percent this year, outpacing growth of online branding ads sales, and hit nine billion yuan in 2009.

E-commerce with Chinese characteristics

here comes an interesting article by Jack Ma, originally published in "The Economist: The World":

E-commerce with Chinese characteristics

Jack Ma | HANGZHOU
From The World in 2008 print edition

A million internet entrepreneurs will bloom, predicts the boss of China’s biggest internet company

In 2008 it will become clear that e-commerce will have a much larger impact in China than in the West. China will generate new models of internet business which will spill over to the West. And e-commerce will lead China’s economy into a new era in which innovation, customer focus and responsible business practices—rather than relationships with people in power—become the main determinants of success.

When Western e-commerce was born in 1995, China could only watch with admiration. The thought of clicking a mouse to buy products online—often from complete strangers—seemed an impossibility in China. If you were lucky enough to have a phone line, internet connection was slow and expensive. Banks were inefficient, making payment difficult and time-consuming. Sending a package meant waiting in long lines at the post office. And consumer culture had not yet taken off, hindered by low disposable incomes and an inefficient, state-run retail system.

It was businesses—not consumers—which drove e-commerce’s early years in China. The most agile enterprises began to take notice of the internet as a channel for finding buyers and suppliers. As China entered the World Trade Organisation in 2001, a new “widget economy” was developing along the east coast of China, fertile ground for a multitude of small and medium-sized companies which made a living from trade. The internet proved to be the best way to connect these otherwise fragmented buyers and sellers, replacing trade shows and magazines as the medium of choice for sourcing products.

By 2003 two trends were converging to bring consumer e-commerce out of its long slumber. China’s first generation of internet users had graduated from universities and turned their attention from online games to online shopping. With ever-increasing disposable income and more products than ever to choose from, a healthy consumer culture had developed, and the physical retail infrastructure was unable to keep pace. Second, international e-commerce companies began major investments in China. The ensuing competition between foreign and local companies helped educate the market, attracting more online shoppers.

New modes of business arose to meet the unique needs of China’s consumers. Rating systems and escrow payment services developed to resolve the issue of trust between buyers and sellers. The integration of real-time chat into marketplaces allowed people to get to know each other before making transactions, a necessary function in a society in which relationships are still one of the most important channels through which trust flows.

In 2007 the leading consumer marketplaces counted 50m users and, for the first time, the value of daily online transactions surpassed the cash taken by major physical retailers in China, such as Wal-Mart. Moreover, users of online-payment systems exceeded the number of credit-card holders, showing that China’s e-commerce is taking a very different path from the West’s, which relied heavily on credit cards.

Whereas C2C and B2C models have remained largely distinct in the West, in China they will continue to blend together, with consumers visiting single marketplaces to buy from individuals, small retailers and large retailers alike. Credit systems will take new forms as individuals and companies develop track records, giving banks reliable information to make loans to businesses and consumers.

The most significant trend in 2008 will be the emergence of a new class of entrepreneurs. Niche manufacturers will link up with niche retailers, cutting out middlemen and out-competing larger, less specialised firms. A growing number of entrepreneurs will buy in volume from China on sites like Alibaba and sell to consumers on Western sites such as eBay.

China’s e-commerce is creating economic opportunities in China and around the world. A new class of businesspeople is emerging and the transparent nature of e-commerce means businesses are becoming more responsible as they further integrate into the world economy. This new generation of entrepreneur provides the best chance we have to encourage economic development at a grassroots level in China, and around the world.

Jack Ma: chairman and CEO, Alibaba Group

Google gets Chinese ICP licence - almost

According to eweek.com, citing a Reuters item, Google Inc. has received "preliminary approval" (whatever that means when dealing with licenses in China) by MII to offer online content. This is apparently primarily not about content in general, but about the Google News service offering news under google.cn domain. This goes beyond a regular VAS license, as the offering of news (even though these news may be merely collected from other news sources, as is typical of Google News) requires a specific license on top of the VAS one. PLUS if you want to become a true news site creating your own (journalistic) content, that is yet another license, of course…  

Full item: http://www.eweek.com/article2/0,1759,2148617,00.asp?kc=EWRSS03119TX1K0000594

Internet too expensive for most Chinese, says news report

Guangming Daily reports Chinese netizens spend ten times more money on the
internet than people in developed countries.
A World Bank report released on Monday reports Chinese netizens spend an
average of 83.5 yuan (US$10.8) on the internet every month, more than 10
percent of their monthly income.
People in developed countries spend an average of less than one percent of
their income to access the same information online.
Experts say internet prices in China should be slashed by at least 20 to 30
percent.
Early this year, Minister of Information Industry Wang Xudong said limits
would apply to internet fees in 2007.
Lots of people say the high internet fees result from the industry
oligopoly. China is the world's second largest market for internet and
broadband services, but a few state-owned companies still set the prices. In
the absence of fierce market competition, these companies are understandably
reluctant to reduce their fees.
But the high prices prevent many Chinese people from using the internet,
which has become the domain of the rich.
Some expert predicts that the number of internet users is expected to
increase at an unprecedented rate when internet charges are cut by 20 to 30
percent. Up to 20 million more people will join China's 137 million netizens
annually and the total number of people online could reach 200 million by
2010.
Source: China Daily,
http://www.chinadaily.com.cn/china/2007-05/02/content_865071.htm

Chinese Internet Usage / Now 137 Million users

The China Network Information Center (http://www.cnnic.net.cn/en/index/) has published its latest Internet usage statistics: between January and December 2006, the number of internet users has risen from 111 million to 137 million, around 23 per cent of an increase. The Internet penetration hence came up to around 10 percent, with the highest figures apparently in Beijing (30 per cent).

What is interesting is the very high share of "broadband" connections, which more than two thirds of all online connection belonging into this category. It surely is a llittle bit of a trick, as most of these will supposedly be (I have not checked, however) of the low-bandwidth DSL variety CNC is offering - hardly what you are used to from higher-quality networks.

News item: http://english.cri.cn/2946/2007/01/23/301@188113.htm

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http://www.information-society.de/IT-Blog/atom.xml

Time Warner Ends Theater Run In China Over a Rule Change

Some news services report on Time Warner's announcement to pull out of the movie-theater business in China. After revisions in  initial foreign investment regulations, it appears to be impossible for investors to retain control over a cinema business in China at the moment.

Among others: Wall Street Journal (subsricption content): http://users1.wsj.com/lmda/do/checkLogin?mg=wsj-users1&url=http%3A%2F%2Fonline.wsj.com%2Farticle%2FSB116301582855217581.html%3Fmod%3Drss_whats_news_asia

China tightening control of online game contents

Sydney Morning Herald (http://www.smh.com.au/) reports on the new
regulations relating Online gaming:
Full Source:
http://www.smh.com.au/news/Technology/China-tightening-control-of-online-gam
e-contents/2006/12/12/1165685659789.html
"China is tightening controls on its booming online game industry, requiring
distributors to closely monitor game contents after some were found that
included forbidden religious or political material, a state news agency said
Tuesday. [...] Distributors must obtain approval to release new games and
submit monthly monitoring reports confirming that operators haven't added
forbidden content".

CH: Internet Addiction / News from Shanghai

Yahoo News has a story about a new halfway house (shelter) for kids suffering from online or gaming addiction. http://news.yahoo.com/s/nm/20060824/wr_nm/china_addicts_dc_1. I have to say: excellent idea, and extremely necessary, too. Let's be really frank about this: the classical symptoms of addiction can be found in so many situations related to media and communications usage that anybody neglecting this as a serious peril to social development has to ask himself whether he really cares about his fellows. I very much appreciate that online addiction is being tackled much more pronouncedly than, say, tv addiction (another highly accepted drug). Interesting aspect is that the social implications of internet usage in particular (including the way users let affect online media their offline behaviour: meeting friends, socialising with the family, etc.) have been much better analysed in a rather early stage of internet take-up than social effects of tv. Maybe the times of blind technology euphoria are over? And will that trend also be visible in places like China, where catching up with Western technology and gadget trends is the motto of the day?
Another news coverage of the same Shanghai shelter: www.techweb.com/wire/ebiz/192205130

Google plans second base on Baidu's home turf

BLOOMBERG in Shanghai
Google, owner of the world's most-used internet search engine, plans to open a centre in Shanghai to help expand its database and add services to challenge Baidu.com in the world's second-biggest Web market. The development facility, its second in China, may open this year, said Johnny Chou, Greater China region president of sales and business development for Google. Google is trying to win market share from Baidu, the most used search site in China, by hiring more engineers to increase the size of its Chinese-language search database and to introduce more local services. The internet search market in China is expected to generate sales of 5.62 billion yuan next year, up from 3.62 billion yuan this year, according to IResearch. The company's website yesterday had adverts seeking applicants for two engineering positions, a salesperson, public relations and tech support in Shanghai. Google is also looking to hire someone to head the Shanghai centre, Mr Chou said.
Google's Beijing development centre opened in the third quarter last year. The company planned to have "thousands of people" at the centre, Google chief executive Eric Schmidt said in April without giving a timetable for the hiring. The search engine is also looking at locations in Shanghai for its centre. Baidu has introduced a weblog, or blog, a service similar to MySpace.com and an internet encyclopedia similar to Wikipedia, to attract users. Google has also started a website with Ctrip.com International, China's biggest online travel agent, where users can find electronic maps and directions. The company also introduced a service in June that lets users search the texts of Chinese-language books.

Chinese TV pirates itself

This bit of news was to be found on AP on Sunday (again, reporting on Xinhua news):
"The Chinese Movie Copyright Association says TV stations here air up to 1,500 pirated Chinese movies a year, costing studios up to $9.4 million in lost revenues, the official Xinhua News Agency reported Sunday." While this is not very terrifying in itself (because it's a minor issue in relation to other media copyright issues that are lurking around every corner), related to this story, I found this press release by US MPAA from march 2006, in which (apart from stating cooperation in the fight of copyright violations), some data is presented on the copyright situation in China and Asia (also here):

"Piracy in Asia: In 2005, the MPA’s operations in the Asia-Pacific region investigated more than 34,000 cases of piracy and assisted law enforcement officials in conducting more than 10,500 raids. These activities resulted in the seizure of more than 34 million illegal optical discs, 55 factory optical disc production lines and 3,362 optical disc burners, as well as the initiation of more than 8,000 legal actions."

"Piracy in China: The piracy rate in China remained an unacceptable high of 93% at the end of 2005. A comprehensive survey of motion picture piracy recently conducted on behalf of the MPA by an independent research firm revealed that piracy cost the film industry in China an estimated 2.689 billion U.S. dollars in 2005.

Update: the deeper you dig, the more scandalous it gets. My immediate wonder is confirmed by Danwei, which points to the evergrowing online copyright violations from which the Chinese film and tv producers suffer. Now it's not just the Chinese blockbusters anymore that the whole world is seeking to steal on the day they hit the silver screen - now the Holy Grail is under attack: CCTV's Spring Festival and Mid-Autumn Festival variety shows have been found on online platforms.

Baidu announces law search

Baidu.com (BIDU), the largest Chinese Internet search engine service provider in China, plans to launch a free law search service. Baidu says the law search service will bring netizens and special legal information closer together. All the data in Baidu's law search is provided by Chinalawinfo Company and edited by legal experts from Peking University Law School. The database covers laws, regulations, legal articles and judicial interpretations since the founding of the People's Republic of China in 1949. Baidu says it will update the content index daily to ensure the content's validity.
Source: http://www.chinatechnews.com/index.php?action=show&type=news&id=4286

China Smart Mobs for Buying

Slashdot notes that Economist has a story about group buying in China via a site called Tuangou. Online sites like Mercata, Mobshop, Blockbuy and ActBig tried this during the dot-com era. Tuangou, roughly translated into group purchasing, is basically a smart mob who arrange the meet up over the internet and show up at a retailer at a specific time and use their number to negotiate a discount with the retailer. In the story, a Tuangou group of 500 show up in Gomei (largest home electronic retailer in China) at 4pm on June 16th and negotiate a 10 ~ 30% discount for the group. Gomei not only closed the door to the normal customers but also prepared goody bags for these Tuangou shoppers.
Full story: http://www.andrewlih.com/blog/2006/07/04/china-smart-mobs-for-buying/

China writes its own digital TV standard

News item from EETimes Online: www.eet.com:

TAIPEI, Taiwan — After years of rivalry and numerous delays, China is poised to roll out a long-awaited standard for terrestrial digital television.

The mandatory standard will cover both fixed and mobile terminals and will eventually serve more than half of China's TV viewers, especially those in suburban and rural areas. Though its name is not official yet, the standard is being called Digital Multimedia Broadcast-Terrestrial/Hand- held. DMB-T/H signals the beginning of the end for small Chinese trials of Europe's DVB-T standard, and it adds another rival to the mix for mobile-TV services in China—the world's largest market for TVs and mobile phones.

URL: http://www.eetimes.com/showArticle.jhtml?articleID=189601091

Warner Music China and China Unicom Enter Landmark Content Agreement

Warner Music China and China Unicom Enter Landmark Content Agreement
Source: Warner Music Group
Jun 20, 2006, 12:55

First Major Music Company to Partner With One of World's Largest Mobile Operators

LONDON -- (MARKET WIRE) -- 06/20/2006 -- Warner Music China (WMC) today became the first major music company to enter a direct, catalogue-wide content agreement with a mobile operator in China. Under the agreement, ringback tones, mastertones and artist greetings by Warner Music artists will be available via China Unicom's CDMA and GSM networks.

Full Story: http://www.kensei-news.com/bizdev/publish//business/ee_business/article_46360.shtml

2.6 Million wesbites registered in China

 BEIJING, May 17 (Xinhua) -- The number of websites registered in China reached 2.6 million at the end of last year and 1.1 million of the websites are with ".CN" domain name.

    The websites increased by 40 percent in terms of number last year, said a report released by the Informationization Office under the State Council. The websites with the domain name of ".CN" increased by 154 percent in 2005, becoming the largest national domain name in Asia and the sixth in the world.

    The websites launched by companies constitute 60 percent, and those launched by individuals account for 21.9 percent, followed by websites on education and on government, the report said.

    The 2.6 million websites are mainly in Beijing, Shanghai, east China's Zhejiang and Fujian Provinces and south China's Guangdong Province. Enditem

http://news3.xinhuanet.com/english/2006-05/17/content_4557623.htm

China's patent applications up by 212% since 2000

According to the World Intellectual Property Organisation (WIPO) the
growth rate for patent applications from Japan, Republic of Korea and
China remains exceptional.
http://www.euractiv.com/Article?tcmuri=tcm:29-152281-16&type=News&Ref=ma
il

Beijing Releases First Computer Literacy Index

December 30, 2005 - The Beijing Municipal Informationization Work Office
has published "Beijing Digital Gap Research Report", the first of its
kind in China to measure the level of computer literacy among the
general public in the city.
http://www.chinatechnews.com/index.php?action=show&type=news&id=3379

Study: Google #1 in China

Study: Google #1 in China - Chris Sherman
2006-01-18 08:46:45
http://chinadigitaltimes.net/2006/01/study_google_1_in_china_chris_sherman.php
From Search Engine Watch:
Despite trailing Chinese traffic leader Baidu, Google is rated the best
search engine in China, according to new research from Keynote Systems.
The study focused on the user experience of the four leading search
engines in China: Alibaba/Yahoo!, Baidu, Google China and Sohu/Sogou.
The study observed the searching habits of more than 1,200 adult users,
with 70% residing in major mainland China cities and 30% located in
diverse locations within the country.

111 million Net users counted in China

In China, 111 million Net users counted - Reuters
2006-01-18 09:00:27
http://chinadigitaltimes.net/2006/01/in_china_111_million_net_users_coun
ted_reuters.php

>From Reuters, via CNet:
The number of Web users in China, the world's second-largest Internet
market, grew by 18 percent in 2005 to 111 million, the Economic Daily
reported Wednesday. Some 8.5 percent of the country's 1.3 billion people
now have access to the Internet, the newspaper reported, citing a survey
released by the China Internet Network Information Center.

A Year without Chinese Produce

"Through tricks and persuasion I got my husband on board, and on Jan. 1
we launched a yearlong household embargo on Chinese imports. The idea
wasn't to punish China, which would never feel the pinprick of our
protest. And we didn't fool ourselves into thinking we'd bring back a
single job to unplugged company towns in Ohio and Georgia. We pushed
China out of our lives because we wanted to measure how far it had
pushed in. We wanted to know what it would take in time, money, and
aggravation to kick our China habit."
http://www.csmonitor.com/2005/1220/p09s01-coop.html

Chinese Advertising prices slump?

Asia Media reports that CCTV had to cut its expectations on next year's
advertising revenues. "Bidding for the slots realised 5.8 billion yuan,
representing growth of just 10.8 per cent -- down on previous years'
growth. CCTV blamed increased competition from rival television
stations." Full story here:
http://www.asiamedia.ucla.edu/article.asp?parentid=34249

Blogging's future in China

Reflections on the future role weblogs may play in China, provided by
Xinhua

China's media crackdown

An interesting overview on the challenges the Chinese TV landscape faces
at the moment, by Pietro Ventani for the Asian Times:
http://www.atimes.com/atimes/China/GH27Ad02.html.

COMMENTARY: Dotcom Boom, Version 2

COMMENTARY: Dotcom Boom, Version 2.
Dotcom Boom, Version 2.0
By The Village Grouch
For those of you who cashed in your Netscape shares early and spent the
last six years in a cave, at sea on your yacht, meditating in the
Himalayan foothills, or otherwise out of touch with the world: welcome
back. You'll notice that a few things are different. New York is now
short two very tall buildings, there's a Bush fighting a war in Iraq
again, Hong Kong has a new chief executive, and gasoline is really,
really expensive.
http://www.chinatechnews.com/index.php?action=show&type=news&id=2955

EP backs careful revision of 'TV without frontiers'

EP backs careful revision of 'TV without frontiers'
Parliament has proposed only minor changes to the Television without
Frontiers (TVWF) directive, in a report on promoting works made in
Europe and by independent producers.
http://Euractiv.cabestan.com/Go/index.cfm?WL=31075&WS=57747_1877436&WA=2
758

Newsletter EU-China Information Society Project

The Eu-China Information Society Project's latest Newsletter titled "What's Coming Up in 2009" is now available for download from this website.
"What's coming up in 2009"(PDF 1.3 MB)

Here are the links to some past newsletters:
"Convergence" (PDF 1.8 MB)
"e-Inclusion" (PDF, 1.7 MB)
"E-Commerce Edition" (PDF, 1.4 MB)
"Information Security Edition (PDF, 1.7 MB)