Francesco Altomare
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10967 Berlin (Germany)
Mobile: +49 151 65623284


The China Delivery Case

Everyone here in the West today talks about – or reads about – the impressive economic developments in China, either in a good or bad way, or even both at times. On the one hand China is one of the most attractive destinations for Online (and not only Online) Businesses with its ever growing, though already huge Market; on the other hand there are numerous Government Regulations which make Trade a headache for the neophyte . A major bottleneck in Chinese Infrastructure is the Internet and restricted access to it, what everyone refers to as the “Great Firewall”. In any case, China just cannot be ignored because it has the largest national User Base worldwide and it’s constantly expanding.
We’ll get into all of this a little more in depth in a bit, but before we do, we would like to underline how this is solely intended to be a high-level, introductory journey to the Chinese Delivery Case; you will notice how we’ll travel across several different topics inherent China for Delivery, each worth a book of its own, and we believe this introduction will pave the way to further, more focused Articles on each and every aspect we’re about to discuss down the road today.

The Chinese Firewall

The starting point for our discussion, something we all must bear in mind, is that China is a Communist Country. This – indirectly – means Censorship on News and Information; maybe even this article won’t make it through China? It is interesting to know that more than fifty thousand Government employees regulate what the almost one billion Chinese get to watch on the Internet. Check following Article out if you need some more insight on it and on , a dissident Entity struggling with it on a daily basis.
The great Chinese Firewall is a result of a decade long campaign by the Chinese Government to censor the Web. Internet Companies regularly police (no double quotes, it’s the case) the Internet to filter out objectionable words and information. As a result, Chinese citizens get to watch a highly censored version of News. Censorship is, though, not the only problem faced by Chinese “Netizens”: due to the over sixty restrictions placed on the Internet Users, their “net” Speed and browsing Performance gets reduced considerably. China Daily, an Online Portal has reported that China is ranked 98th among 200 Countries with an Internet average Speed of 1.5 Megabytes per second. In comparison, South Korea has a speed of 15.7 Megabytes per second, Japan has 10.9 Megabytes per second, and Hong Kong has 9.3 Megabytes per second “net” Speed. The vast chasm in End Users’ Performance is obvious and glaring. Moreover, the actual Broadband Speed may actually fall well below 750 KBPS; of course this has also to do with the two major – and warring – Chinese ISPs, which we’ll look into later on.

The legalities of Chinese Delivery

The Chinese system of Internet Licensing for various Services is heavily regulated. If you felt that registering your Website is easy, then you must try to get the same done in China. The Great Firewall begins right from this stage. The ICP License, or Internet Content Provider License, is a permit for Websites to operate from China to within China.
There are two types of ICP Licenses – one for Commercial use and another for non-Commercial use. If you wish your Website to be hosted (or delivered via a CDN) from inside China to inside China, you must file for an ICP License with all the needed Documents to the Hosting Provider (or CDN, provided it’s allowed to deliver Data from within China to within China itself). The Documentation is first vetted at the Hosting Provider level and then forwarded to the Ministry for a second look. If things work out fine, you may receive the ICP License in four to six weeks. You may be asked to provide additional Documentation in case of any discrepancies found at any of the two stages.
Now you must be wondering “why such a hassle to get my Website hosted/delivered within China? Can’t Viewers see my Website if it is hosted somewhere else?” There are two points to be noted here.
Firstly, Websites hosted outside China download at a _much_ slower speed than from within China. In fact, some Websites may take ages to download and render. Another factor is the aforementioned Censorship. Websites hosted outside China face a potential threat of being blacked out by the Chinese Authority. Due to these two reasons, it is better to get your Website hosted inside China/ delivered from within China to within China if you wish to run your Business there also.

The eternal war between the two Chinese ISPs

By now you must have a fair idea about the problems with doing Online Business in China. The Chinese Government has a footprint on every aspect of the Internet. ISPs are also given License by the Government. As a result there are only two Tier 1 ISPs – China Telecom and China Unicom (formerly known as China Netcom).
Peering between ISPs is not a new concept to you (hopefully): it means, at its very basics,
“End User A comes from ISP One and needs to pull some Content for Website B which is hosted on ISP Two. ISPs One and Two have a Commercial Agreement in place detailing specifically how much Bandwidth they can exchange – “peer” – with each other and from where, and when, and what thresholds are in place”. Of course there’s more to it but this is the overall concept.
Now the peering tussle between China Telecom and China Unicom has crossed all limits. The main issue is the paucity of Interconnects between the two. That, combined with the high demand for Internet access and the resulting congestion, shows us how Internet access in China is fickle. Connectivity is of course badly affected. To buy transit in China is also extremely costly for other ISPs.

Why then care about China?

Like with everything else in our globalized Market, the Chinese Community is one of the largest when it comes to consuming Broadband – and money. The increase in net Traffic year on year is phenomenal. This is a huge opportunity for businesses worldwide. Obviously, you would like (very much so!) to do business here despite all challenges, as the E-Commerce Market is also booming in China.
According to the Research Firm iResearch , Direct-to-Consumer Online Market grew forty two percent in 2013 to three hundred and five billion USD from two hundred and fifteen billion in the previous year. In comparison, US E-Tailers logged in sales of two hundred and sixty two billion in 2013. These are jaw dropping figures, aren’t they? Alibaba, a homegrown China E-Commerce business saw sales of USD two hundred and fifty billion which is much higher than and eBay put together.
The Chinese E-Commerce Market is just too good to be ignored.

How can CDNs help improving your China Delivery?

Given the numerous problems faced by Users and E-Commerce Platforms in China, a CDN Service would well mitigate some of them. Among the big Players in the CDN space, ChinaNetCenter is probably a good bet because of their infrastructure. They have over thirty class A Datacenters and over a hundred Nodes, spread all over China. They have partnered with China Mobile, China Telecom and China Unicom which cover almost the entire Chinese ISP spectrum. Their extensive Networks in China can accelerate Content Delivery throughout the Country.
Another advantage of using ChinaNetCenter is the wide range of Services offered by them. Gaming Companies, E-Commerce Platforms and Online Entities altogether can benefit from using these. Their Content and Traffic Management Solution is targeted to large Telecom, Broadband Operators, Radio and Television Broadcasters.

In Conclusion

The Chinese Dragon brings both benefits and challenges. You can ignore China only at your own peril. Understanding the dynamics of the Chinese System can resolve some of the seemingly unsurmountable problems. In the end, what you must remember is that the Chinese Market is immensely huge and is rapidly increasing. Joining the Dragon is your best option, and we’re here to help consulting you on how to do it.

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