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this document of the .cn-registry is interesting.

sure, the thing is biased but take a look at page 23:

In the first half year of 2010, the number of internet sites in the globe has fallen and that in China has declined synchronously. According to the statistics of Netcraft, in the first half year of 2010, the number of internet sites in the world has been decreased by 27 million7, with a drop of 11.5%. An important reason for the drop of total sites is the expiration of web hosting services.

TFA compares end of 2009 with end of 2010, the survey is unfortunately older (June 2010) so it is not possible to see the same data from the 2 different POVs...

That's how Chinese Internet Keywords work, and there is a "keyword registry" for them, just like a "domain registry".

It's just like DNS though, you're still mapping a name to a number (IP) somehow.

In your example, assuming *.apple was a wildcard top level domain, www.apple would go directly to their website. (And perhaps even "apple" if they used a glue record at the root servers.)

Before the Hanzi Chinese CCTLDs were approved by ICANN, when the only way to use them was to install CNNIC's "Official Client-end CDN Software" in your computer, the registration of a .cn domain name with Chinese characters automatically gave you the version with the Hanzi Chinese CCTLD.

You can read it here in English: http://cnnic.cn/html/Dir/2005/10/11/3218.htm
It's in the answer to the third question.

I don't have any confirmation, but I don't see why they would change their policy.

China's DNS supports their "Internet Keyword", known in the industry as a CN Keyword. It's the exact same concept as an AOL Keyword, you purchase the word/phrase without a TLD/extension and direct traffic to your website.

Not sure why the parent has been modded flamebait. It's probably the phrase "alien Latin-English characters", but it's actually an accurate description of how a domain name might appear to speakers of non-European languages.

I wasn't aware that China had already began experimenting with Chinese characters in domain names, so I did some Googling. Here is a link (in English) that describes how to register a Chinese Domain Name (CDN). It makes for a pretty interesting read. It includes the predictable clause that you can't register CDNs that "harm the glory of the state." Users of CDNs are encouraged to use "Official Client-end CDN Software" to make access more convenient. I wonder exactly what this does.

In general I think it's pretty cool to be able to have non-ASCII characters in domain names, but it seems to introduce a lot of extra compexity into DNS. Also, it seems like it could open the door for more governmental control of the internet, as TFA mentions.

This is no big deal, you guys are kind of funny.
Here is the information about it, it just finally went into effect I guess.
http://www.cnnic.cn/html/Dir/2005/10/11/3218.htm
http://www.tsinghua.edu.cn/
basically becomes this: http://xn--xkrp53d.cn/
Or, as I see it from my end http:///#28165;&%2321326;.cn

Basically, here's what they are doing, they setup their own root to handle the characters and these character domains will be routed to their own TLD, they will probably reroute other stuff they want to as well. Oh well, it's March 1st here in China, and there is no change I can see other than finally being able to use characters.