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In 2001, the overall IT market in China reached US$29.8 billion, a growth of 15% over 2000. It was forecasted that the 2000-2005 Compound Annual Growth Rate (CAGR) for China’s IT market will reach 24.6%. At current year, China has surpassed Japan and become the second largest PC market in the world.

Hardware

Hardware market share currently count for 72 percent of total market. China already has surpassed Japan, become the world second largest PC market in current year. Gartner predicted that China will remain the biggest hardware market in Asian Pacific and accounted for up to 40 percent of the total hardware market, and by 2006, China will represent 47 percent of revenue in the region. ²

Software

The software market is still in its infancy and its growth is encumbered by government regulations and heavy spread software piracy. The piracy rate is at 92 percent high in 2001, even the government offices and state owned enterprise often use pirated versions. Comparing to hardware, the software market is still small. Software sales in 2000 was US$ 2.83 billion, 64% sale was on application software and 32% platform software referring to operating systems, software environments, and database environments, and 4% middleware including development tools, industry-specific software for telecommunications and stock trading, as well network security. By 2005, sales is expected to reach nearly US$20 billions. ³

Internet

The number of people online in China will surpass that in Japan early next century. Source: Computer Economics, Carlsbad, Calif. (ABCNEWS.com)

By 2002, the estimated number of internet users in China is 12 millions. Internet use in China will grow rapidly over the next few years. By 2005, according to research firm Computer Economics, China will have 37.3 million Internet users — second only to the United States’ 126.6 million and just ahead of Japan’s 34.7 million. ⁴

IT Spending

According to a World Information Technology and Services Alliance report, China’s spending on information technology grew by 29.1 per cent over the 1993-2001 period, from $3 billion to $22.5 billion. ⁵