According to research firm Analysys International, the number of Internet users in China will hit 134 million by the end of 2005 - making it the second largest online market in the world, after the U.S. This figure marks a growth rate of around 30 percent from figures at the end of last year.
Analysys have specifically singled out online games as a growth area, with the country’s online subscriber base growing 61.1 percent year-on-year to 24 million, with the market rising 89.5 percent for a total worth of 3.6 billion yuan ($434m). In 2005, the subscriber base is expected to increase by 50 percent to around 35 million people.
With massively multiplayer online games proving especially popular, the Chinese government has attempted to crackdown on Internet cafes and continues to monitor online traffic for content it deems politically sensitive. It has fallen short of banning online gaming activities outright, though, and seems happy to encourage Internet commerce in general.
Although Western companies have so far been slow to expand into the Chinese market, Japanese and South Korean companies such as Sony, Nintendo, Sega, Square Enix and NCsoft have all set up specific teams, either in China itself or dedicated to producing and adapting content specifically for the country.