Growth will decelerate to 3.6% this year, but that will still be enough for 70.4% of the population to qualify as internet users, a threshold China has never reached before. For comparison, in India only 45.0% of the population will be online this year. In the most advanced countries, penetration is usually in the mid-80% range. China is getting close to that status.
There are several explanations for the internet user boost in 2020, but the main drivers were the pandemic, improvement in rural internet access, and increases in usage among older age cohorts. In brief:
- The pandemic had the same effect on behavior in China as it did everywhere else (albeit for a shorter time span, given China’s success in suppressing the virus). People spent more time indoors and had more time to explore new activities, and some of the youngest and oldest found themselves using the internet for the first time, or more regularly than they normally would have.
- Long-standing government efforts to wire rural areas started to bear fruit. In February 2021, the China Internet Network Information Center (CNNIC) reported a spike in internet penetration for rural areas, an outcome propelled by the central government’s efforts to build out internet infrastructure in China’s poorer provinces and villages. According to CNNIC’s data, internet penetration among rural residents jumped from 39.8% in June 2019 to 55.9% in December 2020. The penetration among city dwellers, meanwhile, ticked up by only 4.0% in that time frame.
- Major ecommerce companies, with support from policymakers, ramped up new functionalities and incentives for rural buyers and sellers. Platforms like Pinduoduo revolutionized ecommerce connectivity between rural farmers and urban consumers, generating new financial motivation for rural people to get online. Logistics support for nonagricultural ecommerce improved as well, enhancing the appeal of China’s mcommerce ecosystem for those in remote rural areas.
- Middle-aged and older cohorts jumped online at some of the fastest rates in China’s history. The number of internet users ages 65 and older grew by 38.9% last year, but they weren’t alone. The 55-to-64 age group grew by 33.1%, its fastest expansion since 2009; and even the 45-to-54 cohort (which was already well penetrated) grew by 20.6%, the fastest for that group in 10 years.
The next stage of growth will need to come from these older cohorts, as China’s population ages 12 to 44 is already online at rates comparable to those of the most connected countries in the world.