Internet cafés losing out in China’s online battle

December 26, 2013 2:29 am

Internet cafés losing out in China’s online battle

By Sarah Mishkin in Taipei

Cyber cafés were once a social hub for China’s twentysomethings – and, for authorities, a convenient way to monitorwhat Chinese citizens were doing online. But as usage of smartphones and tablet devices expands, internet cafés are becoming the collateral damage in the battle to get the country online.“Several years ago, we were able to get tens of thousands of [renminbi] a day, but now we are only able to earn several thousand,” says Mr Liu, who runs an airy café with around 30 computers in Beijing’s central Chaoyangmen district of offices and shopping malls.

The spread of cheap smartphones and tablets in Chinahas reached the point that Mr Liu – who refused to give his first name – and many other internet café owners say they worry they are increasingly irrelevant to most Chinese, much like video rental shops have become in the US and Europe.

Research by Tencent, the Chinese social networking and gaming company, found that the number of internet cafés in China fell between 2011 and 2012 after rising consistently since 2004. Around 10,000 closed their doors for good last year, leaving the nation with 136,000 licensed cafés. Data for 2013 are not yet available.

That decline comes as the percentage of Chinese with smartphones has more than doubled from 20 per cent in 2012 to nearly half this year, according to data from market researcher Canalys. Home broadband use has also risen, to 191m last year, a threefold rise from five years prior, according to research by CLSA, the brokerage.

While bad news for owners, it is a welcome development for users as authorities have frequently used cafés as a way to monitor online behaviour.

Activist groups point out that cafés are required to check and log users’ state identification, and police have been known to pressure some cafés to log the sites users visit or install surveillance cameras.

“The authorities have used surveillance mechanisms in . . . internet applications on phones, but the sheer amount of information and the fact that it’s quite new makes it difficult to implement systems that are as effective,” says Maya Wang, a researcher in Human Rights Watch’s Asia division. “There is this infrastructure invested in surveilling these internet cafés.”

The decline of the cafés, however, has more to do with changing technology than with the fact that dissidents avoid them.

Those who still use cafés are those too poor to own a phone or are looking for company as they play the online multiplayer games that are massively popular, particularly with young men.

It was a year ago, says a long-time staff member at a café near the centre of the city of Wenzhou, that business started to go downhill for them and the other cafés in their district. The only ones in the city still doing well are those in industrial areas, frequented by poorer migrant factory workers.

While availability of smartphones cheaper than $100 has put the handsets within reach of more people, not all those phones are on fast 3G connections. CLSA estimates that while 3G use nearly doubled between 2011 and 2012, it still stands at only 233m users in a nation of 1.3bn.

But while cafés are monitored particularly closely, the Wenzhou worker says he has his doubts that users of mobile internet will be that much freer.

“The government’s control on using internet is very strict,” he says.