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Factors Influencing the Diffusion of the Internet in China: 1997-2001
Unformatted Document Text:  16 rate in all areas. In sum, an area with more high-educated population, more family facilitated with home PC, higher urban income level, and lower density of urban population, has the higher rate of Internet penetration. ---------------------------------------------------------- Table 8 about here --------------------------------------------------------- Discussion The demonstration of the S-shaped curve of the Internet diffusion process in China shows the Internet as an innovation diffused at a normal rate under the current socio-economic system. Gradually growing from 1997 to 1999, China’s Internet diffusion experienced a “take-off” in January 2000 and continues to increase steadily. However, the upper bound achieved from the curve estimation suggests that under current social-economic conditions, the diffusion would level off at the point of 57 to 63 million. That is only 5% to 6% of China’s current population, and the penetration rate will be even smaller if we considered the population growth rate; this percentage indicates that China’s current situation does not facilitate deep penetration of the Internet to its large population. This study finds three factors determining the popularity of China’s Internet diffusion, include cosmopolitanism level, the scale of the service industry, and the urban residents’ consumption ability. Cosmopolitanism level in this study is not defined only as the proportion of urban population. Population in China is divided into rural and urban categories

Authors: Lin, Jia.
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16
rate in all areas. In sum, an area with more high-educated population, more
family facilitated with home PC, higher urban income level, and lower density of
urban population, has the higher rate of Internet penetration.
----------------------------------------------------------
Table 8 about here
---------------------------------------------------------
Discussion
The demonstration of the S-shaped curve of the Internet diffusion process
in China shows the Internet as an innovation diffused at a normal rate under the
current socio-economic system. Gradually growing from 1997 to 1999, China’s
Internet diffusion experienced a “take-off” in January 2000 and continues to
increase steadily. However, the upper bound achieved from the curve estimation
suggests that under current social-economic conditions, the diffusion would level
off at the point of 57 to 63 million. That is only 5% to 6% of China’s current
population, and the penetration rate will be even smaller if we considered the
population growth rate; this percentage indicates that China’s current situation
does not facilitate deep penetration of the Internet to its large population.
This study finds three factors determining the popularity of China’s Internet
diffusion, include cosmopolitanism level, the scale of the service industry, and the
urban residents’ consumption ability.
Cosmopolitanism level in this study is not defined only as the proportion of
urban population. Population in China is divided into rural and urban categories


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