The findings were based on a survey carried out in four municipalities directly under the central government — Beijing, Shanghai, Tianjin and Chongqing — and 15 developed cities such as Changchun, Dalian, Nanjing, Hangzhou, Jinan and Guangzhou, among others.

About 8.4 billion yuan (around 1.2 billion U.S. dollars) — more than half of the total — came from male consumers, while 3.1 billion yuan (450 million U.S. dollars) were attributed to students.

The consumer-to-consumer (C2C) site Taobao.com, a subsidiary of online portal Alibaba.com in which Yahoo! invested 1 billion U.S. dollars in 2005, was the nation’s dominant Internet retailer. It had an online shopping penetration rate of 81.5 percent.

Dangdang.com was second with 16.6 percent, followed by Joyo, Amazon’s China subsidiary, with 13.6 percent. Eachnet, owned by Tom Online and eBay, had 8.4 percent, while Tencent’s C2C site Paipai.com was 7.2 percent.

According to the CNNIC, 91 percent of online shoppers who had heard of Taobao had made purchases at the site, while 61.4 percent of those familiar with Joyo had shopped there.

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Alibaba.com, the largest business-to-business portal in China underwent its first day of public share trading in Honk Kong, and the results exceeded all expectations, as the price tripled, raising $1.5 billion. The public offering is expected to raise nearly $2 billion in Hong Kong, making its debut offering as large as Google’s 2004 I.P.O. in the United States.

Companies can post products for sale or buy from Alibaba’s Web site for free. It charges suppliers from China and Hong Kong an annual fee of 40,000 yuan ($5,294) to 60,000 yuan to become so-called premium members, giving them access to services such as a customized home page and higher placements in search results. A similar service is offered to suppliers from other regions for an annual fee of $589.

“We are pleased to welcome investors from Hong Kong and around the world to join us in building a world-class e-commerce company,” said Jack Ma, non-executive chairman of the company and chairman and chief executive officer of Alibaba Group. “Alibaba.com’s IPO ushers in a new era of e-commerce development and we look forward to pioneering an e-commerce ecosystem that benefits businesses in China and around the world.”

Chairman Ma, 43, was ranked the 148th richest person in China with an estimated wealth of $650 million, according to the 2007 edition of the Hurun Report. The IPO will “very likely” push Ma’s wealth past $1 billion, said Rupert Hoogewerf, who has produced the Hurun Report since 1999. China is home to just over 100 billionaires, the report estimates.

Alibaba.com also owns auction site Taobao, which eclipses eBay in China,as well as the online payment service Alipay.The original offer price of shares was HK$13.5, but it opened at HK$30and closed at HK$39.5, a gain of nearly 193 per cent, making the shares the largest first-day surge on the exchange this year.

Alibaba is now valued at $21.5 billion dollars , close to the market value of Yahoo, making it the most highly valued Chinese Internet company and one of the richest in the world.

The offering was reportedly 257 times oversubscribed. The closing price makes it one of the most expensive stocks on the Hong Kong exchange.The closing stock price of HK$39.5 means that Alibaba.com is valued at $25.6bn, leaping it into fifth place among global Internet companies. It also makes it the biggest Internet company in Asia, except for Japan.

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According to the report, the C2C online shopping market in China has been gaining great momentum over the past six months. The report shows a lot of data to back up their claim. The transaction volume of Taobao for the past six months is RMB 15.7 billion, which has increased by nearly 200% comparing to the same period of 2006. Taobao has 39.9 million registered users by the end of June 2007, increasing over 80% comparing to the same period of last year.

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People working in the information technology industry earned more than employees in all other industries on average last year, according to the Shanghai Statistics Bureau.

They were followed by workers in the finance, electricity, gas and water, real estate and scientific research sectors.

The wage gap between different sectors widened last year. The average wage in the IT sector was 3.55 times of the average salary for those in the service sector, the lowest paid group of workers, while in 2000, the average wage in the highest sector was 3.24 times that of the lowest.

From 2000 to 2006, wages in the manufacturing industry grew 13.3 percent annually, and wages for the service sector grew 14.6 percent. Local employees earned 29,569 yuan (US$3,937) a year on average last year, up 10.2 percent from a year earlier. The city’s average salary has grown at an annual rate of 10 percent in recent years, with yearly income reaching 26,820 yuan in 2005 and 24,396 yuan in 2004.

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China could become the world’s biggest online market within two years: the number of Chinese netizens has surpassed 123 million and number of people with access to broadband connection rose by 45.3 percent during the first half of the year to 77 million. Studies show that a typical Chinese consumer spends an average of 17.9 hours per month (36 min./day) engaged in popular online activities such as chatting, blogging, gaming, and shopping.

If foreign businesses want to get in on the action in China, though, they should learn to speak the language. Eighty-five percent spend their time viewing mainland Chinese-language content, while only three percent viewed overseas foreign language content. “The Internet industry is attached to content,” said Professor Guo Liang of the Beijing-based Chinese Academy of Social Sciences, refering to the 18th Statistical Survey Report on the Internet Development in China.

China reports a total of 694,000 websites, over 20% being individual’s. The number of domain names surged 40 percent to reach 2,592,000, according to the report on China’s Internet information and resources 2005 published by the State Council Informatization Office.

E-commerce has been slow to develop in China, though, for several reasons including low penetration rates of credit cards, consumer trust issues, and poor logistics and distribution channels. Eager to tap into China’s consumer revolution, both Chinese and foreign companies like China Mobile, DHL and UPS have invested the money and time needed to address these issues.

The efforts have paid off. Chinese consumers now flock to online shopping sites like Amazon’s subsidiary Joyo and competitor Dangdang, which recently raised $30 million USD from venture capital firms Doll Capital Management and Walden International. Joyo alone is expanding services from book selling to include electronics and other products and is becoming a de facto online shopping bazaar. The number of goods offered on Joyo’s website have increased from 45,000 to 450,000 in the past 2 years.

Joyo’s rise mirrors the growth numbers of e-commerce in China. An estimated 2.08 million Chinese bought products and services online in 2001. In 2006, the number of Chinese consumers making orders online will rise to over 20 million according to estimates by the China Market Research Group CMR. This year two in three people are expected to buy online, with books and computer gear proving particularly popular.

Other mind boggling statistics reflect the growth in all areas of e-commerce: in 2004, the entire Chinese Auction market was about $561 million; in 2005 that number jumped 200% and reached $1.7 billion, with Taobao being the strong player. According to Alibaba.com CEO Jack Ma, Taobao will dominate China online auctions, going head on against eBay.

If such momentum of growth continues, China’s on-line transactions are expected to reach one trillion yuan this year (something around 89 billion dollars), a sharp rise from last year’s 700 billion yuan.”It means China is ready for a boom in e-commerce,” said Chi Congbing, analyst with CCID Consulting.

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