Cracking the Chinese Internet Market, What Netizens are Obsessed with？

China Internet Market

2024 marks the 30th anniversary of China's full access to the international Internet. After 30 years of vigorous development, the number of Chinese Internet users has exceeded 1.1 billion, reaching 1.108 billion. The Internet penetration rate has reached 78.6%, accounting for more than 20% of the global Internet user population. Over the past 30 years, the number of Chinese Internet users has continued to grow, the structure of Internet users has become increasingly coordinated, the digital literacy and skills of Internet users have gradually improved, and hundreds of millions of people have shared the fruits of Internet development.

As of December 2024, the number of Internet users in urban areas in China will reach 795 million, accounting for 71.8% of the total number of Internet users. The number of Internet users in rural areas will reach 313 million, accounting for 28.2% of the total number of Internet users. The Internet penetration rate in urban areas will be 85.3%, an increase of 1.9 percentage points from December 2023. The Internet penetration rate in rural areas is 65.6%.

As of December 2024, 99.7% of Chinese netizens access the Internet through mobile phones. The proportions of using desktop computers, laptops, TVs and tablets to access the Internet are 36.2%, 32.0%, 25.1% and 30.8% respectively. The proportions of using smart connected cars, smart home devices and personal wearable devices to access the Internet are 10.7%, 22.6% and 23.8% respectively. Among them, the scale of netizens using smart connected cars to access the Internet has reached 119 million.

In November 2024 , among the five types of apps that are most commonly used by Chinese mobile netizens, the usage time distribution of instant messaging apps is relatively even between 9:00 and 19:00, accounting for more than 5%. The peak usage of online video apps occurs at 12:00 noon, accounting for 6.2%, and there will be another small peak from 17:00 to 20:00 in the evening, which is in line with the leisure and entertainment time of most netizens. The user usage time distribution trends of online shopping and online payment apps are relatively close, and the total usage time between 7:00 and 22:00 accounts for more than 80%. The usage time distribution peak of online takeaway apps is obvious, which is highly correlated with the meal time of netizens, with usage peaks at 11-12 and 17-18 respectively.

In 2024, China's Internet basic tool applications will continue to develop healthily, with functional construction continuously strengthened and business boundaries continuously expanded. The revenue of enterprises in the information service field will continue to grow. The operation of the Internet and related service industries in the first three quarters of 2024 showed that the revenue of enterprises' Internet business mainly based on information services such as news information, search, and social networking increased by 7.5% year-on-year.

Instant Messaging Industry

The instant messaging industry continues to enrich usage scenarios, improve user experience, and drive consumer conversion and business revenue growth.

Tencent has continuously enriched its own industry ecosystem by creating linkages between WeChat, QQ and online games. Tencent's 2024 interim financial report shows that the total turnover of small games increased by more than 30% year-on-year. The third quarter financial report shows that the international market game revenue increased by 9% year-on-year.

At the same time, Tencent has systematically strengthened its transaction capabilities, created a strong transaction and content ecosystem for the mini program business, and provided users with a smoother shopping experience. In the third quarter, the transaction volume of mini programs exceeded RMB 2 trillion, an increase of more than ten percentage points year-on-year.

In addition, e-commerce business has become an important source ofrevenue. “WeChat Video Channel” business continues to expand product categoriesand encourage more content creators to participate in live streaming, promotingthe continuous improvement of the e-commerce ecosystem. In 2024, the total userusage time of “WeChat Video Channel” increased significantly year-on-year, andthe total user time in the first quarter increased by more than 80%year-on-year, helping “WeChat Video Channel” contribute considerable revenue.

Search Engine Industry

Driven by the innovation of emerging technologies, the search engine industry continuously optimizes service efficiency and promotes the diversified development of market players.

As generative artificial intelligence technology continues to develop, the traditional search engine industry is paying more attention to improving intelligent and personalized services.

• Baidu APP AI functions cover nearly 70% of its monthly active users. More than 20% of search results pages have AI-generated content. At the same time, Baidu is launching the Baidu Wenxin Intelligent Agent Platform for personalized services. More than 100,000 intelligent agents have applied business components, and the number of intelligent agents that have achieved revenue conversion has increased by 395%.

E-commerce platforms, social platforms, etc. pay more attention to building search business based on content ecology, and rely on search business to improve revenue conversion, becoming an important new force in the industry.

• Sina Weibo combines general data with its own unique data, such as real-time hot spots, event context, Internet buzzwords, etc., to help netizens quickly understand the content of hot search terms.

• In January 2024, Tencent’s financial report showed that the number of daily active users of WeChat Search exceeded 100 million, with search volume increasing by more than 30% year-on-year, and its search advertising revenue also increased several times year-on-year.

• 2024 , the average monthly number of users using Kuaishou search exceeded 500 million, and the average daily number of searches increased by more than 20.0% year-on-year to more than 700 million, and the peak number of searches in a single day also exceeded 800 million.

• On Xiaohongshu, 70% of monthly active users use the search function, users search an average of 6 times a day, and one-third of users search as the first thing they do when they open the app.

Data on Chinese Internet Users

◇ As of December 2024, the number of Chinese Internet users will reach 1.108 billion, an increase of 16.08 million from December 2023. The Internet penetration rate will reach 78.6%, an increase of 1.1 percentage points from December 2023.

◇ As of December 2024, the number of mobile Internet users in China reached 1.105 billion, an increase of 14.03 million from December 2023, and the proportion of Internet users using mobile phones to access the Internet was 99.7%.

◇ As of December 2024, the number of rural Internet users in China reached 313 million, accounting for 28.2% of the total number of Internet users. The number of urban Internet users reached 795 million, accounting for 71.8% of the total number of Internet users.

◇ As of December 2024, the proportion of Internet access through desktop computers, laptops, tablets and TVs is 36.2%, 32.0%, 30.8% and 25.1% respectively. The proportion of Internet access through personal wearable devices, smart home devices and smart connected cars is 23.8%, 22.6% and 10.7% respectively.

◇ As of December 2024, the number of IPv6 addresses in China is 69,148, an increase of 1.6% from December 2023.

◇ As of December 2024, the total number of domain names in China is 33.02 million, of which the number of ".CN" domain names is 20.82 million.

◇ As of December 2024, the scale of social network users in China reached 1.101 billion, accounting for 99.3% of the total Internet users.

◇ As of December 2024, the number of instant messaging users in China reached 1.081 billion, an increase of 21.7 million from December 2023, accounting for 97.6% of the total Internet users.

◇ As of December 2024, the number of online video users in China will reach 1.07 billion, an increase of 3.47 million from December 2023, accounting for 96.6% of all netizens. Among them, the number of short video users will reach 1.04 billion, accounting for 93.8% of all netizens. The number of micro-drama users will reach 662 million, accounting for 59.7% of all netizens.

◇ As of December 2024, the scale of online payment users in China reached 1.029 billion, an increase of 75.05 million from December 2023, accounting for 92.8% of the total Internet users.

◇ As of December 2024, the scale of China's online government users reached 1.004 billion, an increase of 31.4 million from December 2023, accounting for 90.6% of the total Internet users.

◇ As of December 2024, the scale of online shopping users in China reached 974 million, an increase of 59.47 million from December 2023, accounting for 87.9% of the total Internet users.

◇ As of December 2024, the scale of search engine users in China reached 878 million, an increase of 51.12 million from December 2023, accounting for 79.2% of the total Internet users.

◇ As of December 2024, the number of online live broadcast users in China reached 833 million, an increase of 17.37 million from December 2023, accounting for 75.2% of the total Internet users.

◇ As of December 2024, the number of online news users in China reached 811 million, an increase of 39.09 million from December 2023, accounting for 73.2% of the total Internet users.

◇ As of December 2024, the number of online music users in China reached 748 million, an increase of 33.31 million from December 2023, accounting for 67.5% of the total Internet users.

◇ As of December 2024, the number of online food delivery users in China reached 592 million, an increase of 47.77 million from December 2023, accounting for 53.4% of the total Internet users.

◇ As of December 2024, the number of online literature users in China reached 575 million, an increase of 54.74 million from December 2023, accounting for 51.9% of the total Internet users.

◇ As of December 2024, the scale of online office users in China reached 570 million, an increase of 33.42 million from December 2023, accounting for 51.5% of the total Internet users.

◇ As of December 2024, the number of online travel booking users in China reached 548 million, an increase of 39.35 million from December 2023, accounting for 49.5% of the total Internet users.

◇ As of December 2024, the number of online ride-hailing users in China reached 539 million, an increase of 11.8 million from December 2023, accounting for 48.7% of the total Internet users.

◇ As of December 2024, the scale of China's Internet medical users reached 418 million, an increase of 3.72 million from December 2023, accounting for 37.7% of the total Internet users.

◇ As of December 2024, the user scale of generative AI products in China will reach 249 million, accounting for 17.7% of the total population.

Data source: China Internet Network Information Center (CNNIC)