Industry Note September 13, 2004 Safa Rashtchy, Senior Research Analyst Technology 650 838-1347,
[email protected] The China Analyst: Online And Mobile Games Aaron M. Kessler, Sr Research Analyst 650 838-1434,
[email protected] Gaining Popularity Reason for Report: KEY POINTS: Industry Overview The China Analyst is our weekly report on the Chinese Internet and technology market. Our commentaries are based on data we collect daily in China using our Related Companies: staff and consultants as well as industry contacts in Mainland China and Hong CTRP 31.52 Kong. Our goal is not to summarize news, but to analyze the most important CHINA 6.73 developments in Internet, online games, wireless services, economy, technology, NTES 35.51 SINA 22.23 consumer behavior, corporate activities, and government regulations, and to SOHU 15.13 discuss how these trends impact both our existing coverage companies in China as SNDA 24.19 well as the broader, long-term development of the Chinese Internet market. Summary of Internet Activity in China (MM) Jun-04 Jan-04 Jun-03 Y/Y % Total active users 87 80 68 28% Dial-up subscribers 52 49 47 11% ISDN subscribers 6 6 5 20% ADSL subscribers 31 17 10 210% Source: China Internet Network Information Center, Piper Jaffray China Research Summary of Telecom Activity in China (MM) Jul-04 Jun-04 Jul-03 M/M % Y/Y % Fixed line subscribers 299 295 241 1.4% 24% Penetration rate 24% 24% 19% - - Mobile users 310 305 239 1.6% 30% Penetration rate 24% 24% 18% - - Source: Ministry of Information Industry of China, Piper Jaffray China Research Industry Commentary – Online and Mobile Games Gaining Popularity as more companies are focusing on this fast growing, and relatively safe, segment.