Main article: Economy of China
China IT Market
2024: $6.1 billion allocated for construction of 8 data centers to accelerate data transfer and develop AI
At the end of August 2024, it became known that China allocated $6.1 billion for a nationwide project to build eight computing centers amid the ongoing technological war between the United States and China over semiconductor and AI technologies. Direct investment by the Chinese government has also spurred more than 200 billion yuan in additional funds, including private capital.
China began implementing the Eastern Data, Western Computing project back in 2022. The government-backed project aims to create a nationwide information technology network where data centers in western China will take on basic computing tasks, offloading centers in more densely populated areas of the east coast.
As part of the project, it is planned to build eight computing centers in the Beijing-Tianjin-Hebei region, the Yangtze River Delta region, Guangdong-Hong Kong-Macau region, Guizhou province, Chengdu-Chongqing district, Gansu province, Ningxia and Inner Mongolia. It is known that the total capacity of computing hubs is 1.95 million server racks, and about 1.2 million racks have already been mounted.
Huawei Technologies is one of the largest Chinese companies involved in this colossal project. Huawei operates Ascend AI chip-based computing clusters in 19 cities across China, including Beijing, Shanghai and Shenzhen. The company also plans to launch new clusters in major cities in the provincial part of China.
Another project participant, Nvidia, said data center revenue grew 154% year-on-year to $26.4 billion in 2024. Despite the tightening of US sanctions, the company was able to get good revenue and intends to invest in the development of new infrastructure within the country.[1]
2023
China's digital economy provides 10% of the country's GDP
In 2023, the main sectors of China's digital economy provided income of about 12 trillion yuan (approximately $1.66 trillion), and the share of value added amounted to about 10% of the country's GDP. Such data in mid-April 2024 was published by the National Bureau of Statistics of the PRC.
The digital economy is a number of economic activities based on modern information networks and information and communication technologies, in which the creation, transmission and use of data are the main technical tools. It is estimated that 32.85 zettabytes (ZB) of data were generated in China in 2023, an increase of 22.44% compared to the previous year. The rapid development of 5G and artificial intelligence technologies, as well as the widespread use of smart devices, have made a significant contribution to increasing the total amount of information through the creation of various content and audiovisual materials. Big data determines not only the pace of digital transformation of industry, but also the dynamics of the development of regions in which large production is based.
Digital technologies make it possible to improve the quality of services provided to the population: for example, during the COVID-19 pandemic, the demand for telemedicine services, including appointment with a doctor via the Internet and remote examination, has significantly increased. The development of the digital economy has led to the emergence of many new industries related to information technology. Among them are named artificial intelligence, big data, cloud computing, blockchain, etc. In addition, digital industrialization contributes to the modernization of industry and the introduction of technologies for smart cities.
Against this background, the capacity of HPC platforms is rapidly increasing in China. In 2023, their total resources reached 230 Eflops, which corresponds to the second place in the world. The total capacity of the arrays data storage is estimated at 1.73 ZB. The need for computing power to train AI models is growing rapidly, with demand in the scientific, government, financial and industrial sectors. Digital technologies are increasingly being integrated into various spheres of China's economic and social development. By the end of 2023, computing capacity at more than 2,200 centers nationwide had grown by about 30% year-on-year.
China is betting on radical changes in all spheres of life through the intensive introduction of digital, communication and state-of-the-art manufacturing technologies. The industrial IoT segment, which integrates with 5G communication systems, is rapidly evolving. In general, the digital economy has become an important factor in maintaining economic growth and the formation of modern highly efficient industry in the PRC. The efforts of the authorities are focused on creating a digital infrastructure and deepening the digital transformation of the manufacturing industry. China is actively forming world-class digital industrial clusters, smart businesses and smart supply chains.
In telecommunications, cloud computing, the Internet of Things, and data centers provide significant revenue. The e-commerce sector continues to develop. At the end of 2023, the PRC State Data Administration opened in the country. The regulator will stimulate the formation of digital China, the digital economy and digital society. It is noted that the digital economy of the PRC demonstrates significant growth potential and contributes to the high-quality development of the country.[2]
China has published a roadmap for the development of computing infrastructure
On October 8, 2023, the Ministry of Industry and Informatization China (MIIT) unveiled a roadmap for the development of computing infrastructure in the country. The initiative, among other things, provides for an increase in the computing power of the PRC by more than one and a half times by 2025. In addition, it is planned to increase resources for. data storage
The Central Commission for Affairs cyber security and Information Technology, PEOPLE'S REPUBLIC OF CHINA the Ministry, the formations National Commission, the health care People's Bank of China, as well as the Commission for Supervision and Asset Management took part state in the development of the document. The project is designed to ensure the development of the Chinese IT industry in the context of sanctions from the outside USA and a difficult macroeconomic situation.
According to the published data, China's computing capacity in 2023 reached 197 Eflops, compared with 180 Eflops in 2022. By 2025, this figure is planned to be increased to 300 Eflops, that is, to increase by about 52% (compared to the value recorded at the beginning of October 2023). In addition, by 2025, China intends to increase the total storage capacity of information to 1800 Ebait, of which 30% will be for "advanced systems." It is said about the development and implementation of new storage technologies, including those based on flash memory.
Until 2025, it is planned to create about 20 new data centers in the PRC. In order to reduce energy consumption and carbon dioxide emissions, such data centers are supposed to use more efficient computing and network equipment. In parallel, optical systems for high-speed data transmission will be developed. In general, the project aims to meet the computing needs of various industries, including manufacturing, education, finance, transportation, healthcare and power.[3]
Digital cemeteries appear in China
In mid-August 2023, it became known that digital cemeteries appeared in China. The idea is to replace traditional graves with small urn bays with ashes and tombstones with screens displaying photos and videos of the deceased. Read more here.
Chinese authorities proclaimed the development of the "computing power industry" in the country
In mid-June 2023, the Chinese authorities proclaimed the development of the Computing Power Industry in the country, which will mark the emergence of new opportunities for the development of the state.
The PRC government reported that computing power is a key productive force in the digital economy. They have become a powerhouse driving economic growth for the Chinese state, as well as unleashing the potential of data as a factor in production.
In terms of total computing capacity, China ranks second in the world as of June 2023, the Ministry of Industry and IT of China said. By the end of 2021, the number of ultra-large and large data centers (data centers) in use exceeded 450 nationwide, and intelligent data centers are already 20.
In 2021, China's computing power market exceeded $210.6 billion, with cloud revenues of $417 billion and Internet data center services of $208 billion, according to the China Academy of Information and Communication Technologies, a state-owned think tank.
 | Due to the rapid development and commercial application of 5G, IoT, AI and IIoT, the demand for data processing is growing, which stimulates the construction of data centers. Major market players contribute to optimizing the distribution of national computing power, the use of green energy in the western regions of the PRC, improving the energy efficiency of data centers and the development of new digital industries in the country, said Xiang Ligan, Director General of the Alliance for Information Consumption, Association of the Telecommunications Industry of the PRC. |  |
In 2022, China launched a mega-project to build eight national data centers and 10 national data center clusters, which indicates that its strategy to redistribute computing resources from the eastern regions of the country to less developed but resource-rich Western regions is in full swing. According to experts from the Chinese publication Renmin Zhibao, the creation of a national network of computing power will allow less developed regions to process and store data transmitted from economically developed areas, optimize the distribution of resources and increase the efficiency of their use. This, in turn, will eliminate excessive data jumps and imbalances in regional computing power.
The Chinese authorities in their report said that technology companies from China and abroad, such as Apple, Huawei, Tencent and Alibaba, have created their data centers and big data storage facilities. Tech giants have also set up regional provincial headquarters thanks to the cool climate and sufficient energy resources in the country.[4]
China declares the development of the digital economy a top priority
On April 4, 2023 State , the council PEOPLE'S REPUBLIC OF CHINA announced that the development of the digital economy is a top priority for the country. The Chinese authorities intend to actively support the deployment and, telecommunication IT infrastructures as well as contribute to the further transformation of enterprises.
In particular, we are talking about accelerating the large-scale commercial use of 5G mobile communications. Cao Shumin, deputy head of the State Office of Internet Information of the PRC, said that the number of 5G base stations in the country by the end of 2022 reached 2.31 million. China is ready to connect more than 500 million households to a gigabit optical network. A group of IMT-2030 has already been created in the country, whose tasks include research in the field of 6G.
As part of a large-scale initiative to develop the digital economy, China intends to form globally competitive digital industrial clusters and expand international cooperation in the relevant area. The PRC is implementing various projects in the segment of developing technologies, such as the Internet of Things, cloud computing, network information centers, artificial intelligence and machine learning. It is noted that digital technologies are widely used in a variety of industries in the PRC. Work will be carried out on the deployment of the data infrastructure.
In general, the volume of China's digital economy reached 45.5 trillion yuan in 2021 (approximately $6.61 trillion at the exchange rate as of April 5, 2023). According to this indicator, the country took second place in the world. The digital economy accounted for 39.8% of Chinese GDP, according to an official document published by the Chinese Academy of Information and Communication Technologies (CAICT).[5]
State Data Management Set Up in China
On March 7, 2023, China announced the creation of a national data bureau, calling it part of an effort to coordinate data resources in the country and achieve the concept of "digital China" conceived by President Xi Jinping. Read more here.
2022
China presents a plan for the development of the national virtual reality industry
On November 1, 2022, China unveiled a special plan aimed at accelerating the development of virtual reality (VR). It is these technologies that are identified as a key branch of the digital economy within the framework of the 14th five-year plan of the country.
The document was prepared by five ministries in Beijing, headed by the Ministry of Industry and Information Technology. The initiative reflects the PRC's desire to become a world leader in the field of virtual reality. Moreover, in addition to VR itself, augmented (AR) and mixed (MR) reality platforms and services will develop. Thus, China expects to cover all areas of the designated industry.
By 2026, the Celestial Empire aims to ship more than 25 million devices for interacting with digital reality. At the same time, however, it is not clear whether we are talking about the annual sales of such a number of headsets or the total volume of sales over the coming years. China delivered a little more than 0.5 million VR and AR devices in the first half of 2022, according to research firm IDC. In accordance with the plan, the volume of the industry in monetary terms should exceed 350 billion yuan (approximately $48.2 billion at the exchange rate). In this case, we are talking about both hardware solutions and related software for using virtual and augmented reality services. At least 100 companies and 10 public VR/AR service platforms are expected to operate in China by 2026.
The Chinese Academy of Information and Communication Technologies, supported at the state level, published a report stating that the industry development plan should be considered in the context of the fact that the governments of the United States and South Korea have identified virtual reality as an important IT direction. It is said, in particular, that giants such as Meta (recognized as an extremist organization; activities in Russia are prohibited), Microsoft, Apple, Google and Tencent.[6]
China began to create its own portal of State Public services
On October 28, 2022, the State Council of China announced its intention to introduce the National Integrated System of Big Data for Government Affairs in the country. We are talking about creating an analogue of the Russian portal of Public services. Read more here.
The head of China named priority areas for digitalization for the next 5 years
In mid-March 2022, Chinese President Xi Jinping unveiled a strategy for how the world's most populous country will use information technology to transform society and government over the next 5 years. He noted that "modernization is impossible without informatization."
One of the achievements that, according to the Chinese authorities, will allow Chinese society to reach the next level of digitalization is the creation of a "single map" that will expand the country's existing digital social security card. Residents of China use it to resolve issues related to labor and insurance. This card also provides for the integration of public services, procurement of medicines and medicines, management of subsidies and much more.
Chinese authorities plan to implement the map on a platform that uses blockchain and involves extensive data sharing to link government applications in areas such as social security, the labor market and health services.
There is also a single portal for accessing government digital services. According to a document published by the PRC authorities, for the further use of digital potential, the country will rely on big data, which China also intends to improve. Improvements will consist in the collection and aggregation, sharing and digitization of historical data to form a national unified application resource.
These electronic libraries are designed to provide services such as data comparison, status verification, identification images, and trend analysis, with data distributed across departments and businesses.
The latter two goals provide for improved service and security of new integrated digital systems and will thus encourage citizens to use more online services.[7]
China approves digital economy development plan until 2025
In mid-January 2022, the State Council of the People's Republic of China published a plan for the development of the digital economy for the 14th five-year plan (2021-2025). The document defines the digital economy as a form of economic activity in which information resources are a key factor in production, and the main driver is the integration of information and communication technologies.
According to the plan, by 2025 China plans to increase the share of added value of key sectors of the digital economy in the GDP structure to 10% from 7.8% in 2020.
According to the document, by 2025 the digital transformation of industries in China will reach a new level, digital social services will become more inclusive, and the digital economy management system will be significantly improved.
The plan lists the main tasks in eight areas, including optimizing and improving the quality of digital infrastructure, promoting digital modernization of enterprises and expanding international cooperation in the field of the digital economy.
According to the document, China will strengthen support for research and development of sixth generation (6G) telecommunications network technology, will increase innovation in strategic areas such as integrated circuits and artificial intelligence, and will contribute to the development of new forms of business.
Another goal included in the plan is a tenfold increase in the number of Chinese households connected to broadband at a speed of at least 1 Gbps - to 60 million by 2025, compared with 6.4 million in 2020.
In addition, as noted in the document, China will strive to regulate areas such as cross-border data flows, market access, antitrust work, the digital yuan and the protection of confidential information in the digital age. At the same time, the PRC will rely on international rules and international experience.[8]
2020: Chinese government allocates $1.4 trillion for 5G, AI and self-driving cars
In mid-May 2020, Beijing decided to step up efforts in the development of key technologies and plans to invest $1.4 trillion in the economy to develop 5G, artificial intelligence, self-driving cars and a number of other technologies to defeat the United States in the technology race.
According to the plan, supported by President Xi Jinping, China will invest $1.4 trillion over six years to 2025 in the development of urban infrastructures and private technology companies such as Huawei Technologies. They will be involved in installing wireless 5G networks, cameras and sensors, as well as developing AI for autonomous driving, automated factories and mass monitoring.
The new infrastructure initiative is expected to give an advantage to local companies like Alibaba and Huawei over American firms. As technology capacity grows, the program will reduce China's reliance on foreign technology, in line with the government's earlier goals.
| | Nothing like this has happened before, this is a gambit of China, which seeks to become a leader in the global technology race, "said Maria Kwok, Chief Operating Officer of Digital China Holdings. | |
The country's largest cloud computing and data analytics providers, Alibaba Group Holding and Tencent Holdings, will be a mainstay in the upcoming endeavor. Other tech leaders, including Jack Ma, also support the program.
The foundations for the new infrastructure will be laid in data centers According to UBS analysts, by May 2020, more than 20 provinces in China have already implemented policies to support enterprises using cloud computing services. The new technology incentive plan is likely to consolidate industrial ISPs and could lead to some larger companies able to compete with global leaders such as GE and Siemens.[9]
Notes
- ↑ China invests US$6.1 billion in data centre infrastructure amid surge in demand for AI chips
- ↑ China provides boost to digital economy, talent
- ↑ China updates national computing plan with calls for more edge, storage, memory, and … Blu-ray?
- ↑ Computing power offers new chances for tech firms
- ↑ Digital economy to receive top priority
- ↑ China Aims to Ship 25 Million Virtual Reality Devices by 2026
- ↑ China declares a new era of digitization has begun
- ↑ China unveils plan to boost digital economy in 2021-2025 period
- ↑ China has a new $1.4 trillion plan to overtake the U.S. in tech
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