Forget Millennials, the Internet's Most Wanted Users Are Older -- and Poorer (wsj.com)

An anonymous reader writes: China's relatively young internet industry is facing a mature-market problem: User growth for popular online services such as instant messaging, search, online news and video has fallen to single digits. Online population growth has hovered around 5% to 6% annually since 2014, which is only slightly higher than in mature economies. Unlike in many developed markets, a vast number of Chinese are unconnected. As they slowly come online, they're creating a sizable market that companies can tap into -- if they can figure out how.

"The Chinese internet is experiencing the third wave of [a] demographic dividend," said Wang Hua, a partner at venture-capital firm Sinovation Ventures, at a speech in December. The first wave, he said, were early adopters, while the second was driven by young people in major cities. "About half of the Chinese population is not yet heavy internet users, and they're the third wave of the demographic dividend," he says. "And they're usually the ones that are in charge of a family's daily consumption." Only 56% of 1.4 billion Chinese -- about 772 million people -- use the internet, according to official data. The U.S. reached that level of penetration in 2002, according to the United Nations. Interest in the lower end of the internet market has been building; live-streaming services have managed to attract working-class Chinese. This time around, the spread of e-commerce and new business models are unlocking more potential.

Comments

Maybe it's the Great Firewall

[BitterOak]

Maybe the fact that China's Internet is surrounded by the Great Firewall is a reason people aren't eager to get on the Internet. If the Internet is nothing but a big Chinese shopping mall and government news distribution site, it isn't really all that enticing for someone to buy the hardware and learn the necessary skills to get online.

Re:Maybe it's the Great Firewall

[aberglas]

NO. Most Chinese are not that upset by the great firewall. Indeed, their take up of technology has been frighteningly fast. In the cities, it has become difficult to spend cash, even for small purchases. *Everyone* uses WeChat Pay. Everyone, except foreigners who cannot use the service.

But most Chinese are poor and rural. While there are many billionaires, the total GDP per capita is still about 1/3 the west. Those poor only have basic feature phones if anything. So they are the next place to harvest new users from.

That said, let us hope that Emperor Xi turns out to be benevolent, because his word is now law.

No iPhones

[Bing Tsher E]

This is a market segment that will never buy an iPhone.

Re: No iPhones

[Opportunist]

People in dictatorships are usually very sensitive to anything spying on them. Something like Farcebook would have never flied in Soviet Russia. People were too used to their private information being used against them.

The US simply had no history of that. But we're gonna catch up soon to the former East Bloc.

At last...

[PopeRatzo]

Forget Millennials, the Internet's Most Wanted Users Are Older -- and Poorer

I knew they'd eventually come crawling back.

Misleading Title

[DatbeDank]

The title should be: Forget Millennials, the Internet's Most Wanted Users Are Older -- and Poorer ... IN CHINA"

Seeing as it's an authoritarian shithole that I can't invest in or run a business without greasing enough hands, why do I care about their fledgling internet companies' woes?

Re:Millennials are discerning.

[93 Escort Wagon]

Your subject line leads me to believe you exist on a planet other than the one I live on.

Delusions of Grandeur

[nehumanuscrede]

If you think you're going to reach the Chinese market with the same bullshit methods you're using on us, think again.
To even get a shot, you're going to have to satisfy God Emperor Jinping and I've got bad news.

If you're not a Chinese company, with Chinese interests in mind, you're wasting your time.