China internet growth slows

Young people are the main internet users in China

The number of internet users in China has reached a record 26.5 million people but growth has slowed, according to a survey.

The number of people online in China has been rising rapidly in the past two years, surging 152% to 22.5 million people by the end of last year, from just 8.9 million at the end of 1999.

But high online fees, slow connection speeds and lack of access to computers means the internet is still a luxury used mainly by high-earners in the cities.

Many young people cannot afford computers

The number of internet users increased by four million people in the first half of the year, according to the survey by China Internet Network Information Centre (CNNIC).

It was significantly smaller than the increase of 5.3 million users in the second half of last year and eight million in the first half of last year.

However, the survey found signs that the internet is gaining wider appeal, not just among young people.

E-commerce stalled

People between 18-30 are still the driving force, but the age group now makes up just 52.9% of China's internet users compared with 91% in 1998. Woman users now account for 38.7%, the survey found.

And people are using the internet not just for news but for entertainment and business. Of those questioned, 34.4% said they used the internet for leisure - a large gain from just 7% in 1998.

However, only 0.3% of people questioned named online shopping and e-business as their main activity online.

And growth in online shopping has been nearly flat in the past six months, the survey reported.

Low incomes blamed

By the end of last year, only 31% of those surveyed said they had bought something online during the past year. The most recent survey found only 31.9% of respondents had bought anything online.

CNNIC said the slow growth in online e-commerce in China was partly due to the fact that most people under 30 had monthly incomes of less than $181 (1,500 yuan).

Other reasons given were:

People like to see what they are buying and check items are not fake

Concerns over the security of transactions

The lack a widespread credit card use in China

China's inefficient and small-scale delivery system

The study was based on 78,300 online questionnaires and 4,828 sample telephone calls.