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CCID Consulting: Review of China's Internet Market in 2008 and Outlook for 2009

BEIJING, Jan. 20 /PRNewswire-Asia/ -- CCID Consulting, China's leading research, consulting and IT outsourcing service provider, and the first Chinese consulting firm listed in Hong Kong (Hong Kong Stock Exchange: HK08235), recently reviewed China's Internet market in 2008 and analyzed its outlook for 2009.

The year 2008 was an extraordinary year for the Chinese and global Internet market: from Facebook's overtaking of MySpace to the rapid rise of xiaonei.com and kaixin.com in China; from the resignation of Yang Zhiyuan to frequent changes in the high-level executives in Sina and Shanda, China's Internet market experienced along with the rest of the world the optimism, changes, competitions, and then the financial crisis at the end of the year.

Licensed Operations Standardize Competitions Between Enterprises

2008 was a landmark year with the introduction of a series of licenses. Starting with the audio and video service permit issued to video websites on December 29, 2007, the Internet in China entered an era of licensed management. Subsequently, Beijing and other localities introduced new regulations for online stores in terms of business license applications. China Central Bank will also formulate corresponding provisions for the electronic payment industry.

Despite aspects for further improvement during the early period of their issuance, the licenses will play a certain active role in standardizing competitions in the market. Taking the video license as an example, almost 300 enterprises have obtained the license since the beginning of the year. In the future, licenses will become more open.

SNS Moved from a Website to Become a Platform

SNS was no doubt the biggest highlight in China's Internet market in 2008. Though SNS has quietly developed in China for 3 or 4 years, it did not receive much recognition until the coming of the fast-rising Facebook. Overnight, the passion for entrepreneurship generated by SNS spreaded rapidly. Soon, xiaonei.com, zhanzuo.com, 51.com and kaixin.com which are similar to Facebook have become the hot areas for a new round of investment in China's Internet market. In April, China InterActive Corp. obtained an investment of $430 million. These handsome appeals have greatly promoted the development of China's SNS market.

In addition to the eye-catching professional SNS websites, Sina, Yahoo and other portal websites, vertical websites and telecom carriers have also explored the SNS model. The joining of these forces has brought more opportunities to SNS.

Looking back at the features of development of SNS in 2008, OpenAPI and Widget applications have become the logic trend. In the future, the development direction of SNS should be based on OpenAPI to get a bigger room for cross-platform and cross-regional development. It will gradually change from friend-making websites to friend-making platforms that provide technological frameworks and system user resources. Through continuous integration of all kinds of software and services, it will become a more integrated platform. These software and services that operate on SNS contain unlimited business values to be tapped into.

The Chances of Success for Video Websites

The year 2008 saw some ups and downs for China's video industry. Firstly, it was the introduction of the provisions for video website licensing which set strict viewing conditions. These provisions once became a threshold before video websites. The subsequent occurrence of a series of major events put video websites to the forefront of news broadcasting. During the Olympic Games, the huge online video traffic and full data both proved that online video is gradually changing netizens' viewing habit. Through cooperative and standardized operations, video websites have started to make new considerations on profit model innovations. On one hand, it is to take advantage of Web2.0 to strengthen users' loyalty to original content video sharing. The other is to realize the commercial values of copyright video contents.

As online video technology gradually improves and network bandwidth increases in the future, online video will bring richer and better user experiences to netizens. More netizens will gradually shift their attention from TV and other traditional media to online video, thus forming a good complementary relationship with TV and film.

E-Business Becoming the Mainstream

E-business has long been defined as a kind of sales channel and even a kind of fashion- and trend-oriented sales channel. As a result, it exists as an assisting channel to mainstream sales channels. In 2008, E-business made important breakthroughs in the B2C field in China. Both investment cases and investment value increased fast. A large number of traditional industry segments such as goods for mothers and babies, IT digital products, jewelry and building materials have started to enter the B2C market, and attracted continuous attention from VC, B2C has become an important market segment which drives the growth of China's E-business market. The success of the B2C model has gradually raised the position of E-business in enterprises' business operations.

In 2009, the B2C market in the IT digital, furniture and building material fields will become a hot area of growth for China's E-business market in the next few years.

At the start of 2009, the arrival of 3G license in China will be greeted with great optimism. The opportunities which it brings for mobile Internet are bound to become a warm current to drive away the cold economic winter. Meanwhile, it will also provide a greater driving force for the transformation and development of Internet enterprises.

About CCID Consulting

CCID Consulting Co., Ltd. (hereinafter known as CCID Consulting), the first Chinese consulting firm listed in the Growth Enterprise Market of the Stock Exchange (GEM) of Hong Kong (stock code: 8235.HK), is directly affiliated with China Center for Information Industry Development (hereinafter known as CCID Group). Headquartered in Beijing, CCID Consulting has so far set up branch offices in Shanghai, Guangzhou, Shenzhen, Wuhan and Chengdu, with over 300 professional consultants after many years of development. The company's business scope has covered over 200 large and medium-sized cities in China.

Based on major areas of competitiveness: industrial resources, information technology and data channels, CCID Consulting provides customers with public policy establishment, industry competitiveness upgrading, development strategy and planning, marketing strategy and research, HR management, IT programming and management. CCID Consulting's customers range from industrial users in electronics, telecommunications, energy, finance, automobile, to government departments at all levels and diversified industrial parks. CCID Consulting commits itself to becoming the No. 1 advisor for enterprise management, the No. 1 consultancy for government decisions and the No. 1 brand for informatization consulting.

    For more information, please contact:

     Cynthia Liu
     Coordinating Manager
     CCID Consulting Co., Ltd.
     Tel:   +86-10-8855-9080
     Email: liuyan@ccidconsulting.com

SOURCE CCID Consulting Co., Ltd.

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