China grapples with net dilemma

Counter-Strike: Popular online game in China

China is desperate to catapult the nation into a technological future, but with it may come many of the freedoms associated with the internet. BBC World ClickOnline's David Jamieson in Shanghai looks at how China is coping.

Some 16 million people live in Shanghai, a sprawling, humid city. Numbers and data are nothing new here, but the way they are now being used is.

This is where you will find many of China's estimated 46 million internet users.

As well as surfing or instant messaging, they play online games like Counter-Strike.

Technology manufacturers see China as a massive market, with a potential 1.3 billion consumers.

Spread of PCs

"It's going to become the second largest PC market in the world, overtaking Japan by the end of this year or early next year," said Gartner analyst Bob Hayward.

"There is high growth in PCs but that's from a very small base.

"Typically you have to be a well paid corporate executive to be a home user here in China, it's not become something you see in the average household," he said.

But he believes that political and cultural factors, like China's one child policy and the education ethic, could help the spread of computers.

"Parents here will sacrifice a lot to get a computer if they feel it's important for their child's education," said Mr Hayward.

Net controls

For high school pupils in Shanghai, internet access can be as simple as dialling a number which puts you straight online via China Telecom, although the speed is a low 28kps.

46m Chinese are online

The web they surf is of course censored.

Try visiting sites like the New York Times or BBC News and you are more than likely to find that access will be denied.

Internet service providers must agree to install blocking and filtering software that stops certain sites being available.

But there are ways around the Great Firewall of China, as it has come to be known.

Chinese who work for foreign companies have been know to share access to their companies' corporate networks, which often have uncensored access to the net.

And it is also a simple matter to dial into an ISP in Hong Kong, where access is not as tightly controlled.

Chinese bubble?

With its towering skyscrapers and wide boulevards, Shanghai is a 21st century city. But it would be easy to get the wrong impression.

There is a danger of having too many false expectations about China

Bob Hayward, Gartner

To get a feeling for the real China, you have to walk down one of the side streets.

If you do that, you begin to realise some of the challenges faced by this vast country as it joins the rest of us in the age of the internet and the worldwide web.

The vast majority of Chinese live in remote rural areas. For them, a PC costs the equivalent of a year's salary.

If there is a phone line that connects their village to the world, in some cases it will be so outdated as to be made of iron.

"There is a danger of having too many false expectations about China," warned Mr Hayward.

"Just as we saw the dot.com bubble bursting, you can do the same thing with a country as well and get overexcited about the expectations.

"The reality is that doing business in China is hard, it takes patience, you have to be careful about what you're doing, some of the opportunities may not be as big as people think."

"You have to be realistic and pragmatic about China," he urged.

It is a stark warning to foreign technology businesses that see the mirage of a massive, billion strong market.

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