Cell phone users

In addition, CNNIC's research also showed that 318 million Chinese people would use their cell phone as one way to surf the Internet, up 14.95 million on last year's figure. However, the growth rate hit a three-year low of 4.9 percent compared with the highest growth rate of 61 percent during the second half of 2008.

Thanks to the rapid growth in mobile phone e-commerce and mobile phone advertising, the market value of China's mobile Internet industry reached 6.44 billion yuan ($991 million) in the first quarter of this year, up 43.4 percent quarter-on-quarter, an iResearch report found. By 2013, the number of China's cell phone Internet users may exceed PC Internet users, Beijing Television reported.

However, CNNIC's report suggested that the increase in China's cell phone Internet users may slow down since the current increase is based solely on new subscribers. Most of the potential cell phone Internet users have already converted to mobile Internet clients.

China had about 920 million of them as of June, Beijing Times reported on July 26, citing information from the Ministry of Industry and Information Technology. The number of users will increase rapidly again only if the carriers can improve their network environment, cut surfing charges or develop new services targeted on rural cell phone users and senior citizens, CNNIC's report said.

Meanwhile, the number of users of China's third-generation (3G) networks remains small, which acts as a restraint on the expansion of the mobile Internet industry. The nation boasted 73.76 million 3G-network users (including a small number of wireless network card and landline 3G users) by the end of May, the report said.

Group-buying websites

The number of group-buying users jumped 125 percent in the first six months of this year compared with the same period last year, reaching 42.2 million, the report showed. But the service quality of some of the small- and medium-sized group-buying sites was questionable, the CNNIC report said.

The financial situation of a great number of group-buying websites is not as good as the soaring client base indicates. Many of the small group-buying websites have closed because of bad financial results, according to a Beijing Business Today report.

The number of group-buying websites surged this year to meet increasing demand. China had nearly 5,000 group-buying websites as of June, according to a report posted on Analysys International's website.

Larger group-buying sites, such as gaopeng.com, are likely to lay off as much as 25 percent of their staff, TechWeb.com.cn reported on July 27. Groupon's China arm has more than 3,000 employees in more than 120 Chinese cities.

Online gaming

The number of China's online game users rose slightly during the past six months. A total of 7.27 million online game players were added from January to June, the report said, pointing out that the rate of increase was as low as 2.4 percent for the first six months of this year compared with the same period last year. The nation has 311 million Internet video-game players.

The absence of new types of games was behind the slowdown in the online gaming industry. The country's online gaming developers failed to introduce adequate new products, the report said.

Nevertheless, according to a chinanews.com report, the nation's online video-game industry may face a fresh round of rapid growth in the near future.

The nation's online game market was valued at 8.76 billion yuan in the second quarter of this year, up 3.1 percent, the report said.

The value of China's online video-game market could reach $8 billion by 2014, according to Pearl Research, a San Francisco-based consulting company.

"That rate of growth is faster than the core video game industry in the US," wrote Dean Takahashi, an online video-game researcher at technology blog VentureBeat.