2014 China Online Recruitment Report

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2014 China Online Recruitment Report www.iresearchchina.com (Brief Edition)

Transcript of 2014 China Online Recruitment Report

2014 China Online Recruitment Report

www.iresearchchina.com

(Brief Edition)

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4 Status Quo of China Online Recruitment Industry

Environment for the Development of China Online

Recruitment Industry

Typical Models of China Online Recruitment Market

Contents

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Trend Forecasts of China Online Recruitment

Industry

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Rising Internet Penetration as the Basis for Industry

Growth

Internet Population Hit 618 Mn, Up 9.5% YoY China Internet population totaled 617.58 million in 2013, up 9.5% YoY. Internet penetration rose to 45.8% and is forecasted to top

60% by 2017. According to iResearch, mobile Internet users, and Internet users in lower-tier cities and rural areas will significantly

boost the growth of total Internet population and penetration in the following a few years.

Source: CNNIC. 2014-2017 data is based on iResearch statistical forecasting model.

384.00

457.30 513.10

564.00 617.58

669.20

731.43

790.00

850.00

28.9% 34.3% 38.3% 42.1% 45.8% 49.4% 53.6% 57.3% 61.1%

0

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400

600

800

1,000

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2009 2010 2011 2012 2013 2014e 2015e 2016e 2017e

Internet population (mn) % Penetration

China Internet Population and Penetration Rate 2009-2017

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Mobile Internet Bred New Opportunities

Mobile Internet Population Reached 500 Mn, Up 19.1% YoY

China mobile Internet population amounted to 500 million in 2013, jumping by 19.1% YoY with penetration of 81.0%. The growth,

being the fastest in the past three years, has powered China mobile Internet economy. iResearch believes that the boom of mobile

Internet provides good opportunities and hardware support for recruitment agencies to improve services, optimize products and

enhance user stickiness.

233.44

302.74

355.58

419.97

500.06

578.00

637.00 689.00

745.00

60.8% 66.2% 69.3% 74.5% 81.0% 86.4% 87.1% 87.2% 87.6%

0

200

400

600

800

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2009 2010 2011 2012 2013 2014e 2015e 2016e 2017e

Mobile Internet users (mn) % Penetration

China Mobile Internet Population and Penetration Rate 2009-2017

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SMEs Gradually Became Major Employers

Number of China SMEs Hit 57.78 Mn in 2013

iResearch statistics show that the number of China SMEs totaled 57.78 million in 2013, up 7.8% YoY. Since large enterprises are in

stable growth stage with lower mobility of staff and richer resources of recruitment, they have more diversified channels of

recruitment. By contrast, SMEs are experiencing rapid growth and generating numerous job openings. Higher mobility of talents,

concern about cost performance of recruitment and higher requirements of recruitment efficiency made SMEs major employers in

online recruitment market.

Note: SME is defined in accordance with composite standards. Criteria for SMEs are established in the light of such indices as number of employees, sales volume, total

assets, etc., in the Interim Provisions on the Standards of Small and Medium-sized Enterprises, jointly issued by the Ministry of Commerce, National Development and

Reform Commission, Ministry of Finance and National Statistics Bureau, as well as characteristics of industries. Some individually and privately owned businesses

above a certain size are also included.

Source: Based on related data of State Administration for Industry & Commerce of P.R.C. and Bureau of Statistics of China, interviews with enterprises and experts, as

well as iResearch statistical model and forecasts.

41.86 45.57

49.59 53.61

57.78 62.58

67.45 72.70

78.14

8.9% 8.8% 8.1% 7.8% 8.3% 7.8% 7.8% 7.5%

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40

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80

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120

2009 2010 2011 2012 2013 2014e 2015e 2016e 2017e

Number of SMEs (mn) % Growth

Number of SMEs in China 2009-2017

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Contents

Status Quo of China Online Recruitment Industry

Environment for the Development of China Online

Recruitment Industry

Typical Models of China Online Recruitment Market

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Trend Forecasts of China Online Recruitment

Industry

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Online Recruitment Market Grew Stably

China Online Recruitment Revenue Reached 3.08 Bn Yuan in 2013

According to iResearch statistics, China online recruitment revenue increased to 3.08 billion Yuan in 2013 at a growth rate of

15.2%. Despite robust growth of employer base, ARPU decreased substantially amidst fierce market competition, hence declining

growth of total revenue. Nevertheless, accompanied by expanding employer and user base, iReseach predicts bright prospects of

online recruitment market in the next a few years. First, improved service capabilities of comprehensive recruitment websites and

business expansion in market segments will fuel the growth of online recruitment market. Second, innovative business models

including mobile recruitment, social recruitment and vertical recruitment sites will be new growth engines for the sector. Third,

low-end recruitment market will boom along with rising Internet penetration.

Source: Based on the financial results of listed companies, interviews with enterprises and experts, as well as iResearch statistical model and forecasts.

1.1 1.2

1.7

2.2 2.7

3.1

3.7

4.4

5.3 6.1

14.2% 8.9%

41.3% 28.6% 22.4% 15.2% 19.8% 20.2% 19.0% 15.2%

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2008 2009 2010 2011 2012 2013 2014e 2015e 2016e 2017e

Revenue (bn yuan) % Growth

China Online Recruitment Revenue 2008-2017

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Expanding Employer Base and Declining ARPU

Employers Recruiting Online in China Surged to 1.97 Mn in 2013

The number of employers recruiting online in China climbed to 1.97 million in 2013, soaring 21.6% YoY. According to iResearch,

along with steadily rising Internet penetration, online employer base will keep expanding. In addition, recruitment needs from micro,

small and medium-sized businesses will continue to increase. Moreover, the growth of Chinese economy will also exert direct

influence on the recruitment needs of enterprises.

Source: Based on the data of State Administration for Industry & Commerce of P.R.C., financial results of listed companies, interviews with enterprises and experts, as

well as iResearch statistical model and forecasts.

0.81 1.05

1.34

1.62

1.97

2.52

2.94

3.40

3.88

35.0% 29.6% 27.6%

20.9% 21.6% 28.2%

16.3% 15.8% 14.0%

0.0

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2009 2010 2011 2012 2013 2014e 2015e 2016e 2017e

Online employers (mn) % Growth

Number of Employers Using Online Recruitment Services in China 2009-2016

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Online Job Hunters Increased Stably

Online Job Hunters in China Exceeded 100 Mn in 2013

The number of online job hunters in China hit 103.89 million in 2013, up 10.3% YoY. Growing Internet penetration further expanded

online applicant base. Nevertheless, its growth will gradually decelerate and the figure is forecasted to reach 150.65 million by

2017.

Source: Based on the data of State Administration for Industry & Commerce of P.R.C., financial results of listed companies, interviews with enterprises and experts, as

well as iResearch statistical model and forecasts.

65.00

78.00

87.00 94.22

103.89

115.25

126.83

138.63 150.65

30.0% 20.0%

11.5% 8.3% 10.3% 10.9% 10.0% 9.3% 8.7%

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2009 2010 2011 2012 2013 2014e 2015e 2016e 2017e

Online job hunters (mn) %Growth

Number of Online Job Hunters in China 2009-2016

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Share of Lowly Educated Job Applicants On the Rise

Online Applicants Were Mainly Highly Educated Groups

iResearch data revealed that the share of highly educated online job seekers dropped from 89.7% in 2009 to 85.8% in 2013

whereas that of lowly educated applicants increased considerably. As the Internet penetrates into lower-tier cities and rural areas,

there are big opportunities among lowly educated and blue-collar population.

Note: High-end labor force refer to job applicants with junior college and above degrees and low-end labor force refer to job applicants with senior high (secondary

technical school) and lower qualifications.

Source: 1. iUserTracker. Home Office Edition. February 2014. Based on the long-term measurement of online behavior of 400 thousand home and office (excluding

public Internet café) panelists. 2. Based on iResearch proprietary data, interviews with enterprises and experts, as well as iResearch statistical model and forecasts.

89.73% 90.11% 87.53% 85.43% 85.76%

10.3% 9.9% 12.5% 14.6% 14.2%

0%

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40%

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2009 2010 2011 2012 2013

% High-end labor force % Low-end labor force

Educational Qualifications of Online Job Seekers in China 2009-2013

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Contents

Status Quo of China Online Recruitment Industry

Environment for the Development of China Online

Recruitment Industry

Typical Models of China Online Recruitment Market

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Trend Forecasts of China Online Recruitment

Industry

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Comprehensive Online Recruitment

Typical Models of China Online Recruitment Market——

Comprehensive Recruitment Sites (51job.com)

As the first Chinese online recruitment company listed on the US stock market, 51job remained as the No.1 player in China online

recruitment market.

It provides a full line of services which mainly include headhunting, training, assessment, HR outsourcing, among others. iResearch

data shows that online recruitment revenue made up 60.2% of 51job’s total revenue in Q1 2012, which increased gradually to

66.6% in Q2 2013. By contrast, the share of publication advertising revenue was on the decline mainly because market demand is

shifting from print advertising service to online advertising service. iResearch believes that online recruitment market still has

tremendous growth potential and meanwhile, other HR related services will facilitate online recruitment companies to turn into

comprehensive HR service providers.

Source: Based on the financial results of enterprises, interviews with experts, and iResearch statistical model.

Mobile Recruitment Social Recruitment Vertical Recruitment Classified Information Comprehensive Recruitment

60.2% 65.5% 64.4% 59.9%

65.2% 66.6% 66.2% 61.2%

12.6% 6.1% 6.1% 3.2%

6.5% 2.7% 2.2% 1.2%

27.3% 28.4% 29.5% 36.9%

28.3% 30.6% 31.6% 37.5%

0%

20%

40%

60%

80%

100%

Q1-12 Q2-12 Q3-12 Q4-12 Q1-13 Q2-13 Q3-13 Q4-13

Revenue Structure of 51job Q1 2012-Q4 2013

Online recruitment revenue Publication advertising revenue Other HR related revenue

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Comprehensive Online Recruitment

Typical Models of China Online Recruitment Market——

Comprehensive Recruitment Sites (Zhaopin.com)

Zhaopin.com (ZPIN.N) was listed on New York Stock Exchange on June 12, 2014, making it the second Chinese online recruitment

company that went public in the U.S.

According to the financial results of Zhaopin.com, the share of online recruitment revenue dropped to 81.4% in 2013 from 85.9% a

year ago. At the same time, new business expansion has made good progress as the share of campus recruiting revenue and

assessment service revenue both surged. Career assessment performed particularly well and was less affected by seasonal

factors.

Source: Based on the financial results of enterprises, interviews with experts, and iResearch statistical model.

Mobile Recruitment Social Recruitment Vertical Recruitment Classified Information Comprehensive Recruitment

83.3% 90.4% 90.8%

79.8% 82.3% 84.8% 84.9% 74.9%

9.2% 2.8%

1.4% 12.3% 9.5% 6.5% 5.4%

14.6%

1.1% 2.6% 2.1%

4.3% 4.3% 4.0% 4.4% 5.3% 6.5% 4.2% 5.8% 3.6% 3.9% 4.7% 5.4% 5.3%

0%

20%

40%

60%

80%

100%

Q1-12 Q2-12 Q3-12 Q4-12 Q1-13 Q2-13 Q3-13 Q4-13

Revenue Structure of Zhaopin Q1 2012-Q4 2013

Online recruitment revenue Campus recruitment revenue Career assessment revenue Other HR related revenue

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Mobile Recruitment

Online Recruitment Companies Differed over Mobile Demand

After 51job.com launched a mobile version of the site, recruitment companies also rolled out their respective apps one after another

during 2013 and 2014. According to iResearch, mobile enjoys unique advantages over PC due to privacy, usage during fragmented

time and mobile data. Nevertheless, mobile also has a natural disadvantage. That is, small screen size of mobile devices and the

time difference in synchronizing mobile with PC jeopardized user experience. Moreover, the constraints of mobile devices make it

difficult to shift display recruitment ads from PC to mobile.

Therefore, iResearch believes that although mobile-based development is the wave of the future for online recruitment industry,

different online recruitment companies have variant demand on mobile service.

For comprehensive recruitment sites-privacy + usage during fragmented time

Considering the unique display form of comprehensive recruitment sites, mobile app will provide more privacy to job hunters during

work time and on certain occasions while facilitating them to search for job openings and submit resumes during fragmented time.

For business social networking sites-data + stickiness

User coverage and stickiness are core operating indices for business social networking sites. Mobile app enjoys a natural

advantage in promoting social products and enhancing user stickiness. Therefore, user stickiness is the key demand of business

social networking sites in mobile Internet era.

For classified information sites-blue-collars

Classified information sites may cover extensive blue-collar and low-end job applicants via mobile devices due to their specific

characteristics and conditions. Meanwhile, mobile service is more suitable for such user groups in view of special cases of job

application without resume or via telephone.

Social Recruitment Vertical Recruitment Comprehensive Recruitment Classified Information Mobile Recruitment

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Business Social Networking

Business Social Networking Challenged Traditional Online

Recruitment

Founded in December 2002 and launched in 2003, LinkedIn has over 85 million individual registered users and 500 corporate

users covering hundreds of industries in more than 200 countries worldwide. Listed in the US stock market on May 20, 2011,

LinkedIn creates a social service model that is efficient, secure and of business value through artistic way of advertising and serves

as a good example for social recruitment.

Source: Financial results of enterprises.

Mobile Recruitment Vertical Recruitment Comprehensive Recruitment Classified Information Social Recruitment

54.4% 53.3% 54.9% 53.0% 56.8% 56.4% 57.2% 55.0%

25.5% 27.7% 25.4% 27.4% 23.0% 23.5% 22.5% 25.0%

20.1% 19.1% 19.7% 19.6% 20.2% 20.1% 20.3% 20.0%

0%

20%

40%

60%

80%

100%

Q1-12 Q2-12 Q3-12 Q4-12 Q1-13 Q2-13 Q3-13 Q4-13

Revenue Structure of LinkedIn Q1 2012-Q4 2013

Talent solutions Marketing solutions Paid subscription

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Business Social Networking

Opportunities and Challenges Coexist for Business Social

Networking in China According to iResearch, social recruitment sites enjoy clear advantages in timeliness and targetedness. Moreover, social is an important

trend for online recruitment market. Business social networking platform, positioned for social networking but not confined to job hunting,

is also a platform for communication and cooperation among high-end groups. The combination of social with business attracts the

attention of increasingly more business professionals. Nevertheless, social networking sites also meet with obstacles in China. On the

one hand, constrained by Chinese traditional culture, social networking has not made a breakthrough in product model in China. On the

other hand, social networking needs to refine the classification of user groups based on big data. For companies, the key is fast access to

data and strengthened data analysis capabilities.

As for industry landscape, a number of business social networking sites sprung up both at home and abroad. With business as the basis

and social as the tool, a brand new social recruitment model was built. Typical examples include LinkedIn, dajie.com and tianji.com. In

contrast, drawing on extensive user base and rich data, another type of business social networking came into being with social as basic

platform and business as the module. The advantage of the former lies in professionalism in business while the strength of the latter is

extensive user base. Meanwhile, social is becoming an important tool for other traditional websites which aim to boost innovation and

growth potential via big data and social networking.

Business Social

China

Overseas

Business

Social

Networking

Business Social Networking Market Landscape

Mobile Recruitment Vertical Recruitment Comprehensive Recruitment Classified Information Social Recruitment

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Vertical Recruitment

Vertical Recruitment Brought in Brand New Opportunities for

Traditional Recruitment Companies

Vertical recruitment site is an online recruitment model that provides specialized services in a certain segment of online recruitment

market, including region segments, industry segments and market segments. As online recruitment sites grow into comprehensive

HR service platforms, increasingly more demand for value-added and HR services of employers is bringing about new business

opportunities for online recruitment companies. Meanwhile, how to serve clients in a professional and vertical manner becomes top

priority of online recruitment companies. Against such backdrop, vertical recruitment sites are brought into spotlight and will center

on value-added services other than recruitment.

Therefore, traditional comprehensive recruitment sites and emerging startups both eyed the market.

Mobile Recruitment Social Recruitment Comprehensive Recruitment Classified Information Vertical Recruitment

Industry

Vertical

Region Vertical

高端垂直

Industry

Vertical

High/Low-end

Vertical

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Vertical Recruitment

Classified Information Platform

Classified Information Platforms Will Significantly Impact

Recruitment Market Landscape Classified information platforms, represented by ganji.com and 58.com, are rapidly expanding online recruitment market share based on its

extensive user base, flexible market strategy and clear market positioning. Ganji.com and 58.com successively promoted “recruitment” as

top section on their sites. At present, information service platforms mainly target at low-end and blue-collar job applicants in recruitment

market and their business model is mainly based on advertising and membership fees.

iResearch believes that the core values of low-end recruitment market lie in the following.

First, vast market space. Traditional recruitment sites mainly focus on middle to high-end users. Along with accelerated urbanization in

China, numerous low-end job applicants also have tremendous demand for job hunting. Meanwhile, increasingly more economic entities

including individually-owned businesses have heavy demand for recruitment. The match of supply and demand will give rise to a vaster

online recruitment market.

Second, differentiated needs of employers. Recruitment of low-end applicants show unique characteristics. Specifically, (1) mainly from

labor-intensive industries; (2) some favor blue-collar and technical applicants; (3) exhibit clear seasonality; (4) weaken the role of resume.

Third, needs of low-end job applicants better satisfied on mobile. Low-end users usually access the Internet via mobile devices.

Considering the needs of employers and the way of contact, mobile will better meet the needs of low-end job applicants.

Mobile Recruitment Social Recruitment Comprehensive Recruitment Classified Information

High-end

Middle-end

Low-end

Classified

Information

Platforms

Comprehensive

Recruitment Sites

High-end Vertical

Recruitment

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Classified Information Platform

Ganji.com: Shift of Strategic Focus to Low-end Recruitment

Founded in 2005 and headquartered in Beijing, ganji.com currently sets up branch offices in Shanghai and Shenzhen and covers

over 350 cities nation-wide. It offers comprehensive local lifestyle and business service information including job recruitment,

properties for sale or rent, second-hand goods trading, vehicle selling and buying, pets, ticketing, education/training, city-wide

activities and dating, among others. Ganji later partially shifted its business focus to online recruitment market and released 2012

Urban New Blue-collar Survival Report and 2013 New Blue-collar Salary Report to target at low-end job applicants. In February

2014, Ganji launched the first online recruitment festival in China in an attempt to build a preferred platform for changing jobs after

the Spring Festival, which attracted more than 30 million job hunters. In addition, it rolled out its mobile recruitment app, Ganji Job

Assistant, to further expand low-end recruitment market. According to iResearch, dominant sections of classified information

platforms like real estate are encountering growth bottleneck and are significantly affected by the macro environment. Along with

the boom of small, micro and privately owned businesses, employers have strong and growing demand for blue-collar, technical,

and low-end job applicants. Therefore, it is wise of Ganji to partially shift its strategic focus to online recruitment.

Vertical Recruitment Mobile Recruitment Social Recruitment Comprehensive Recruitment Classified Information

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Vertical Recruitment

Classified Information Platform

58.com: Info Service as Basis

Founded in December 2005 in Beijing, 58.com was listed on New York Stock Exchange on Dec. 31, 2013, Beijing time. In June 2014, it

entered into a strategic partnership with Tencent for in-depth cooperation in mobile Internet sector and other key product lines to jointly

enhance product functionality and user experience. The site mainly offers a variety of lifestyle services covering properties for sale and

rent, job recruitment, second-hand goods trading, yellow pages, pets, ticketing, travel, dating, catering, entertainment, and more.

The major source of revenue for 58.com is membership and advertising fees. By paying for membership fee, merchants are entitled to

basic service package, including merchant verification, setting up of online shop and the privilege to release information. The privilege

gives merchants priority in releasing information, higher quota for the amount of information released, and assistance from client service

team and online account management system. The business model of 58.com is more suitable for low to middle end job recruitment,

SMEs in particular, and its profit model also suits current recruitment market. Besides, 58.com may further penetrate into online

recruitment market for large enterprises through new recruitment products such as well-known enterprises and prime recruitment

services while enhancing its attractiveness to middle-end talents.

58.com rapidly expands into a diversity of business segments by drawing on the traffic and data of its information service platform as well

as large user base in a bid to build a more comprehensive lifestyle service platform based on information service.

Mobile Recruitment Social Recruitment Comprehensive Recruitment Classified Information

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Contents

Status Quo of China Online Recruitment Industry

Environment for the Development of China Online

Recruitment Industry

Typical Models of China Online Recruitment Market

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Trend Forecasts of China Online Recruitment

Industry

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Trend Forecasts of China Online Recruitment Industry

Trend 1: HR market boasts huge potential, Internet penetration will

keep rising

Chinese HR service market has grown to a certain scale with tremendous potential. First, as Chinese economy is still in the stage

of rapid development, the size and quality of labor force are constantly improving, which underpins the growth of Chinese HR

service market. Second, along with robustly increasing job openings and needs for manpower, job stability of young applicants will

drop, giving rise to more demand for job hunting and recruitment. Third, the huge demand of employers for skilled workers helps

enhance their value in the HR market, which further extends the market to cover online recruitment, training, assessment and other

offline HR service segments.

Online recruitment market will keep growing. According to iResearch, the exploration of more value-added services will boost the

core business of online recruitment, which will further attract employers and help build differentiated competiveness. In addition, HR

outsourcing services represented by training and assessment are more easily and efficiently delivered via the Internet. SMEs will

be more willing to accept lower cost while vast market and extensive user base will drive up the revenue of online recruitment

companies.

Trend 2: Online recruitment will further change traditional offline

recruitment models

Traditional offline recruitment models mainly include offline job fairs, recommendation from acquaintances, headhunting, and

advertising on traditional media like newspapers and magazines. According to iResearch, the advancement of Internet technology

will highlight the advantages of online recruitment, enhancing its coverage, timeliness and matching efficiency. Moreover,

accompanied by constant innovation in the models of social recruitment, vertical recruitment and high-end recruitment, online

recruitment will fully penetrate into traditional offline recruitment segments. Besides, as more blue-collar workers gain access to the

Internet, online recruitment will cover more blue-collar population. Meanwhile, blue-collar market will become an important new

market segment for online recruitment companies.

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China Online Recruitment Report Definitions

Concepts:

Recruitment Services

Refer to services offered to employers and job hunters by recruitment service operators during the process of recruitment and job

hunting. It mainly includes online recruitment, newspaper & magazine recruitment, headhunting, HR outsourcing and job fair.

Online Recruitment

Refers to a recruitment model that helps employers and job hunters find potential employees and jobs based on the Internet and

related technologies.

Online Recruitment Services

Refer to Internet platform and related technical assistance provided to employers and job hunters by recruitment sites during the

process of recruitment and job hunting. It covers services targeted at employers and job hunters, such as release of job openings,

download of resumes, customized recruitment, generation of resumes, search of job vacancies, salary query, among others.

Online Recruitment Operators

Refer to companies that own recruitment sites and provide online recruitment services.

Online Recruitment Revenue

Refers to the combined revenue of online recruitment operators generated by providing online recruitment services. It excludes the

revenue from offline services of online recruitment sites such as newspaper, headhunting, training, job fairs, etc.

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China Online Recruitment Report

Methodology

Data collection and analysis mainly adopt online survey method via iUserSurvey, a market research platform specifically developed

for online media user research, in conjunction with in-depth interviews with and research on related operators and channel agents.

1. Research Method

In line with statistical theory and international practice, this research mainly adopted online survey method. Online survey was

conducted in February, 2014 on iResearch’s iClick research community (URL: http://survey.iclick.cn/). A total of 5,635

questionnaires were collected and invalid questionnaires were excluded. After giving a weighting in accordance with gender, age

and regional distribution of users of recruitment sites, we finally obtained a total of 3,986 valid questionnaires.

2. Sample Matching of Internet Users

A weighting was given in accordance with gender, age and regional distribution of users of recruitment sites in iUserTracker.

3. Representativeness and Limitation of Data

The users participating in iResearch’s user behavior survey do not represent all Internet users in China. As a result, the survey

results do not fully represent the overall situation of Chinese Internet population.

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China Online Recruitment Report

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regulations on intellectual property rights in the Peoples’ Republic of China. No organization or individual is allowed to use the information in this

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information and their copyrights are held by the original authors. No organization or individual is allowed to use the information in this report for

any business purpose without written consent from original authors and iResearch.

Data related to operators’ revenues and market forecasts are mainly obtained through interviews related to the industry, marketing survey,

secondary sources and other research methods, some of which have not been directly confirmed by the related operators. Some data published

in this report is based on sampling method and is therefore influenced by sample structure. Due to the limitation of research method, sample size

and scope of data collection, part of the data may not precisely reflect real market situation. This report is for reference only and iResearch is not

liable for the accuracy of the data in this report.

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