The development and integration stage

2007

The year 2007 witnessed vivid Internet development in China as many hot issues, public focuses and suspicious cases were captured and magnified by the Internet, ranging from NPC&CPPCC sessions, the 17th National Congress of the Communist Party of China, e-commerce, online game companies going public, Mergers&Acquisition cases, the "Unprecedented Nail Household" incident and South China Tiger Incident.

In 2007, as Web 2.0 represented by Blog drew to a close, Business-to-Customer(B2C) boomed. Online game and software companies, led by Perfect World Co Ltd, Giant Interactive Group Inc. and Kingsoft Co Ltd going public collectively triggered the third Initial Public Offering(IPO) boom. Different from the first boom represented by portal websites in 2000 and the second boom represented by Baidu 2004, the third boom in 2007 saw a wider range of wealth creation ridden by Chinese Internet companies, which had entered into the capital market, as the global capital market was gaining momentum and the profits gained by Chinese Internet companies were expanding. That Alibaba Group, Giant Interactive Group Inc. and Kingsoft Co Ltd went public not only pushed their leaders up the rank of the wealthiest, but also produced a number of wealthy employees. Unlike the previous two booms which primarily relied on the talents of the entrepreneurs, the third boom disperse stock shares among employees during the prolonged process that lasted 8 to 10 years; thus, the boom of rich groups came into being. As Alibaba Group, the e-commerce giant, went public, the market values of Tencent, Inc, Baidu and Alibaba Group all exceeded $10 billion, and the total market value of listed Chinese Internet companies reached nearly $70 billion. As e-commerce platforms developed rapidly, the "Light Asset Company" business model, represented by Perfect Products Group(PPG), opened up the B2C market, and the fever of e-commerce will definitely last.

The year 2007 was full of highlights. There was the "IPO" boom on the one hand, and mergers took place one after another on the other hand. March saw the merger of Focus Media Holding Ltd. and Allyes; and May witnessed Focus Media joining hands with Eastmoney.com, the largest financial website, and launching a series of acquisitions involving companies such as iResearch, Beijing Wonder Advertising Co Ltd, Shanghai Jiangpan Meida Group, and CGEN Digital Media Network Co Ltd. Similar mergers and acquisitions included Wantsun Technology's purchase of efu.com.cn, Hurray! Holding Co Ltd merging with Enlight Media, and Linktone Ltd being acquired.

Still in 2007, the the Communist Party of China(CPC) and the central government attached great importance and provided strong support to the healthy development of Internet in an unprecedented way. The 11th Five-year plan for the Informatization of National Economic and Social Development was issued, laying out the overall goals of informatization and Internet development during 11th Five-year Plan period, setting out key projects, and defining support measures. These were all important steps to boost the integration of informatization and industrialization as well as to implement the Scientific Outlook on Development. The same year saw the official launch of the Comprehensive Anti-spam Platform built by Internet Society of China(ISC). On this platform, telecom carriers and e-mail service providers could share their data and deal with spams together. The Comprehensive Anti-spam Platform has become the most authorative one among the similar products in China and even in the whole Asia-Pacific region.

Though the great play featuring "Wealth creation", "Merger&Acquisition" and "11th Five-year Plan" drew to a conclusion, we still believe that the Internet era that belongs to China has just started.