Virtual China Information Technology - Analysis: E-Business, pg 6

Analysis

E-China

V. Conclusion: The thin red line

Because of the tools a national information infrastructure offers to administration, it is and will continue to be rolled out forcefully. Because of e-commerce, people will be encouraged on to it. And because it meets real consumer needs, they will flock to it. The government believes it can control what goes on, and just in case will continue to explore closed networks. As a result, the numbers of Internet users in China will grow at a stunning rate over the next few years.

What we have been looking at throughout this piece is a government-driven timetable. The Western media may be focusing on Charles Zhang and Sohu, or Edward Zeng and his Internet cafes, but that is because these are the stories they associate with the Internet -- easily digestible pieces about cyberpreneurs getting rich fast. But what the Western media is missing is that the Internet is about networks, and the networks are being built by the government. They are also ignoring the motives which underlie China Telecom wanting to multiply the numbers of people going on-line.

Anyone looking to the Internet as the great equaliser -- the mechanism by which individuals in China can rebalance themselves vis-à-vis the state -- will be disappointed. Sure it will help, for those individuals who want greater access to news and information from other parts of the world, but to focus on these individuals at the expense of the big players will be to miss the point. The organisations which are driving, and which will benefit, from China's national information infrastructure roll-out are the big players of government and stateowned industry.

A comparison with the growth in mobile phone usage is illuminating. Mobile phones are connecting huge numbers of Chinese, and can, of course, be used for all manner of illicit deeds. Doubtless some of them are. Their main purpose, however, is to generate huge revenues for China Telecom, allowing it to continue investing in the roll-out of its networks, both mobile and fixed, at a phenomenal rate. Unicom, on a far smaller scale, views them in the same way: the one part of its business which can be expected to generate cash fast enough to make a contribution to the roll-out of its other business.

But it is not business alone. Senior government officials see new information and communication networks as providing benefits from both an economic and a socio-political point of view. As we have seen, from the very start of the Golden Projects officials have regarded advanced networks as having to potential to be powerful coordination tools -- powerful enough to resuscitate the state from its fading role as a mediator and arbiter of economic activities in society. A centralised and powerful state can not only play a crucial role as a mediator in the marketplace, but it can also institutionalise exchange transactions and minimise transactions costs.

At the same time, enhanced national communications allows a significant increase of political monitoring and control. Although increased networking could provide a national platform for the organisation and dissemination of political dissidence, government officials in Beijing believe that an adequately designed network will serve first and foremost the interests of the central government.

And this is the point: on-line developments in China are not taking place in a vacuum. They must be set against the wide background of the government restructuring, and the affect this is having on how the government operates. Is the centre as obsessed with control as it has always been? The answer is yes. But it needs putting in context, and the most significant of these is that it has more things to worry about than ever before. Over the last two decades, since the start of the reform era, China's economy and society has become infinitely more complex and fragmented. So while the Communist Party's desire for control remains as strong as ever, it has been diluted by a multiplication of issues on its agenda. The government restructuring announced at the National People's Congress in March 1998 acknowledged this, and aimed explicitly at producing ministries focused on policy development and regulation, not line management. The goal -- to control more and manage less.

In other words, the preeminent role that information technology and networks can play in China's modernisation has its roots in the country's economic reforms and the reconceptualisation of both economic and political administration. China's Internet growth is far less surprising than it first appears, and will almost certainly proceed at a pace that will continue to look astonishing to all observers, however much they may be expecting it.

This Article

	Introduction
I.	China on-line: Real-time change or virtual reality?
II.	Top down: It's all about the network
III.	It's the e-conomy, stupid
IV.	Controlling the content
V.	Conclusion: The thin red line