China has surpassed the United States to become the world’s largest internet market as measured by number of users, consulting and research firm BDA (http://www.bdaconnect.com/) confirmed today.

Data released earlier this year by the China Internet Network Information Center (CNNIC) indicate China’s internet users totaled 210 million at year-end 2007. Nielsen/NetRatings put the United States internet population at 216 million for the same period.

“Based on these sources and the assumption that these markets have continued to grow in 2008 to date at the same rates that they grew in 2007, we can conclude that China has by now comfortably surpassed the United States as the world’s largest internet population” said Bin Liu, BDA’s Beijing-based Principal Analyst for New Media.

BDA Chairman Duncan Clark commented: “A buoyant economy, massive investments in broadband infrastructure and strong consumer demand for applications including online games, instant messaging and online-music and online-video sharing are fuelling China’s rapid Internet growth.”

BDA estimates revenues from China’s online games sector totaled RMB 13.3 billion (USD 1.88 billion) in 2007. China’s online games revenues exceed the combined revenues from its online brand advertising (RMB 6.6 billion, or USD 930 million) and search (RMB 2.8 billion, or USD 395 million), according to BDA estimates.

BDA estimates China’s online game players totaled 50.4 million at year-end 2007. In instant messaging, the “QQ” brand instant messenger client of Shenzhen-based Tencent reportedly served 289 million active user accounts by 3Q 2007.

The United States still far outstrips China in the value of internet content, advertising and e-commerce, but BDA expects e-commerce to become the next boom sector in China as businesses and retailers take advantage of the mass market of consumers already online.

BDA’s Clark added: “With some 560 million subscriptions, China has been home to the world’s largest mobile communications user base for several years. Now it adds internet users to its gold medal collection. While the volume of communications users will continue to boom, the focus now in China will increasingly shift to deriving greater value from these consumers. Over time BDA expects China to emerge as part of an Asian ‘New California’ where – together with highly developed Asian markets such as Japan and South Korea – innovative applications and companies help shape consumer trends globally.”

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