World Internet Development Report 2018: Blue Book of World Internet Conference [1st ed.] 9789811540660, 9789811540677

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Chinese Academy of Cyberspace Studies

World Internet Development Report 2018 Blue Book of World Internet Conference Translated by Peng Ping

World Internet Development Report 2018

Chinese Academy of Cyberspace Studies

World Internet Development Report 2018 Blue Book of World Internet Conference

123

Chinese Academy of Cyberspace Studies Beijing, China Translated by Peng Ping Beijing Foreign Studies University Beijing, China

ISBN 978-981-15-4066-0 ISBN 978-981-15-4067-7 https://doi.org/10.1007/978-981-15-4067-7

(eBook)

Jointly published with Publishing House of Electronics Industry The print edition is not for sale in China (Mainland). Customers from China (Mainland) please order the print book from: Publishing House of Electronics Industry. © Springer Nature Singapore Pte Ltd. 2020 This work is subject to copyright. All rights are reserved by the Publishers, whether the whole or part of the material is concerned, specifically the rights of translation, reprinting, reuse of illustrations, recitation, broadcasting, reproduction on microfilms or in any other physical way, and transmission or information storage and retrieval, electronic adaptation, computer software, or by similar or dissimilar methodology now known or hereafter developed. The use of general descriptive names, registered names, trademarks, service marks, etc. in this publication does not imply, even in the absence of a specific statement, that such names are exempt from the relevant protective laws and regulations and therefore free for general use. The publishers, the authors, and the editors are safe to assume that the advice and information in this book are believed to be true and accurate at the date of publication. Neither the publishers nor the authors or the editors give a warranty, express or implied, with respect to the material contained herein or for any errors or omissions that may have been made. The publishers remain neutral with regard to jurisdictional claims in published maps and institutional affiliations. This Springer imprint is published by the registered company Springer Nature Singapore Pte Ltd. The registered company address is: 152 Beach Road, #21-01/04 Gateway East, Singapore 189721, Singapore

Foreword

Today, information technology is changing day by day, represented by digitalization, networking, and intelligence, contributing to the development of economy and society, national governance systems and governance capacity, and the people’s increasing demand for a better life. Meanwhile, Internet development has given rise to new challenges to all countries’ sovereignty, security, and interests. It is the common goal and vision of the international community to promote the sustaining development of the Internet so that all nations can share the Internet development’ achievements. The goal requires joint effort and participation of all countries. Against this backdrop, we have compiled the World Internet Development Report 2018 (“the Report” for short hereinafter) to study and analyze the world Internet development, summarize the past experience, analyze the present status, and manifest the Chinese academic circles’ knowledge and thinking of the world Internet development, providing new reference and intelligent support for the global Internet development. Three efforts have been made in the Report as follows:

We Always Take President Xi Jinping’s Thoughts on International Cyberspace Governance as the Theoretical Basis for Exploring the Chinese Solution to the World Internet Development and Governance The global Internet governance system has entered a critical period, in which ideas on international governance of the Internet coexist, competing and communicating with each other. There is a rising voice for an inclusive solution. Mr. Xi Jinping, President of the People’s Republic of China, has illustrated international Internet governance on many important international occasions, especially the “four principles” on promoting the global Internet governance system reform and the “five proposals” on building a community of shared future in cyberspace, which have won extensive praise and universal recognition from the international community

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Foreword

and provided the Chinese solution to the world Internet development and governance. The Report will take President Xi’s thought on international cyberspace governance as the theoretical basis and main thread running through, comprehensively illustrate his thoughts, ideas and proposals on cyberspace governance, and objectively and comprehensively interpret the Chinese solution to Internet governance. It is aimed to provide a new choice for global Internet development and governance and contribute to promoting the building of a community of shared future in cyberspace.

We Always Take the Practices of the World Internet Development as the Research Basis for Compiling the Report into a Mini-Encyclopedia About the Internet Since the beginning of the Internet, information technology has been developing fast and has comprehensively been integrated into social production and life, with a great impact on the pattern of global economy, interests, and security. Major countries all take the Internet as their strategic focus and priority of development and speed up its construction. They have had new practices, measures, and achievements in the areas from technology to application and from Internet development to cyberspace governance. The Report, focusing on the status quo and trend of the world Internet development as well as the practices and achievements of all countries’ Internet development, especially the new situation and new progress in 2018, reviews and analyzes the development of key Internet areas such as network infrastructure, information technology, digital economy, e-governance, network media, cybersecurity and Internet law construction, and international cyberspace governance, showing the new technologies, new applications, and new trend of the world Internet development in 2018. It is a panoramic research achievement covering all areas of the world Internet development.

We Try to Make Everything Comprehensive, Accurate, and Objective and to Improve the Assessment System of Global Internet Development Research The Report is aimed to be international, authoritative, and accurate as well as instructive, theoretical, and general. We try to interpret the global situation from the Chinese perspective to predict future Internet development. In particular, the World Internet Development Index we released last year, is a specific, standard application of President Xi’s thoughts on international cyber governance. It helped to measure the general situation of the world Internet development from the Chinese perspective, winning the international community’s attention and causing great

Foreword

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sensation once it was released. This year’s index is consistent with that index, with some adjustment of the indicators and some expansion of assessment scope. We have collected more data to showcase the world Internet development more comprehensively, accurately, and objectively. The Report is a tentative study of Chinese academic circles in providing an original and theoretical reference for the world Internet governance. We will continue to pay attention to the world Internet development and keep proposing ideas to help all countries to benefit from the world Internet development and to contribute Chinese wisdom and effort to the building of a community of shared future in cyberspace. Beijing, China October 2018

China Academy of Cyberspace

Contents

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2 World Network Information Technology Development . . . . . . . . . . . 2.1 Overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.2 Steady Innovative Development of Network Information Technology . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

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1 Development of World Information Infrastructure . . . . . . . . . . . 1.1 Overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.2 Broadband Network . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.2.1 Increasing Percentage of Fiber Broadband, with Its Accessibility Toward Gigabits . . . . . . . . . . . . 1.2.2 Increasing Number of 4G Users and 5G Technology on Its Fast Track . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.2.3 Advancing IPv6 Commercial Deployment and Healthy Development of Its Industrial Ecosystem . . . . . . . . . . . 1.2.4 Interconnection of Network Facilities . . . . . . . . . . . . . 1.2.5 Fast Developing Space-Based Internet, Which Has Been Laid Out by All Countries . . . . . . . . . . . . . . . . . 1.2.6 Innovative Universal Telecommunication Service Facilitating Network Construction and Application in Rural Areas . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.3 Application Facilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.3.1 Intensification and Globalization of Data Centers and Cloud Computing Platforms . . . . . . . . . . . . . . . . . 1.3.2 Rapidly Developing CDN Industry and Integration of New Technologies into CDN . . . . . . . . . . . . . . . . . 1.3.3 Steady Development of NB-IoT and EMTC and Increasing Popularization of IoT . . . . . . . . . . . . . . 1.3.4 Expanding Internet Exchange Centers and Rapidly Rising Cloud Interconnection . . . . . . . . . . . . . . . . . . . 1.3.5 Uneven Distribution of Basic Internet Resources and Uneven National Networking Capacity . . . . . . . . .

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2.2.1 Continuous Breakthroughs of Advanced Computing Technology in Computing Capacity Limit . . . . . . . . . . 2.2.2 Rapid Renewal of IC Technology . . . . . . . . . . . . . . . . 2.2.3 Cloud Tending to Be Integrated with Software Technology . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.3 Cutting-Edge Hotspot Technology Highlights . . . . . . . . . . . . . 2.3.1 Fast Development and Application of AI Technology . 2.3.2 Progress in Blockchain Technology . . . . . . . . . . . . . . 2.3.3 Quantum Information Technology Leading to New Waves of Industry and Research . . . . . . . . . . . 2.3.4 Steady Development of IoT Sensing Technology . . . . . 2.4 Integrated Development of Network Information Technology and Traditional Areas . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.4.1 Accelerated Intelligent Manufacturing Technology Application . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.4.2 Expanding Intelligent Medical Technology Application 2.4.3 Maturing Automatic Driving Application . . . . . . . . . .

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3 World Digital Economy Development . . . . . . . . . . . . . . . . . . . . . . 3.1 Overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.2 Generally Fast-Developing IT Industry . . . . . . . . . . . . . . . . . . 3.2.1 Accelerated Recovery of Electronic Information Manufacturing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.2.2 Recovering Basic Telecommunication Industry of the World . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.2.3 Rapid Development of Information Technology Service . 3.2.4 Ecologicalized Competition Shaping Super-Businesses . . 3.3 Explosive Growth of Intelligent Manufacturing . . . . . . . . . . . . 3.3.1 Increasing Scale of Intelligent Manufacturing . . . . . . . . 3.3.2 The United States, Japan and Germany Leading the Global Intelligent Manufacturing . . . . . . . . . . . . . . . 3.3.3 Wide Application of Intelligent Devices Represented by Robots . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.3.4 Cultivation and Application of the Industrial Internet APPs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.4 Rapidly Developing Global E-Commerce . . . . . . . . . . . . . . . . . 3.4.1 Online Retail Boosting the Global Retail Market . . . . . . 3.4.2 Major Drive in Emerging Markets . . . . . . . . . . . . . . . . 3.4.3 Thriving Global Cross-Border e-Commerce . . . . . . . . . . 3.5 Digital Technology Leading the Transformation of the Service Industry . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.5.1 Thriving Sharing Economy . . . . . . . . . . . . . . . . . . . . . . 3.5.2 Deep Integration Between Digital Technology and Livelihood Service . . . . . . . . . . . . . . . . . . . . . . . .

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3.5.3 Accelerated Digitalization of Productive Service Industry . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.6 Rapid Development of Fintech . . . . . . . . . . . . . . . . . . . . . . . 3.6.1 Trend of Global Fintech . . . . . . . . . . . . . . . . . . . . . . . 3.6.2 Deployment of Major Countries and Regions . . . . . . . 3.6.3 Rapid Development of Lending and Payment . . . . . . . 3.7 New Trend of Global Investment Brought About by Digital Economy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.7.1 Stable Percentage of Investment in Telecommunication 3.7.2 Substantial Growth of the Semiconductor Market . . . . 3.7.3 Active Investment in e-Commerce . . . . . . . . . . . . . . . 3.7.4 Active Investment and Financing in Internet Transportation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.7.5 Increasing Amount and Price of Digital Health Financing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.7.6 New High in Assessed Value of Businesses . . . . . . . .

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4 Opening-Up of Global Government Data . . . . . . . . . . . . . . . . . . . 4.1 Overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.2 History of Opening-Up of Government Data . . . . . . . . . . . . . . 4.2.1 Rudiment Period of Opening-Up of Government Data . . 4.2.2 Extensive Stage of Government Data Opening Up . . . . . 4.2.3 Development Period of Opening-Up of Government Data . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.3 Status Quo of Opening-Up of Global Government Data . . . . . . 4.3.1 Increasingly Open Government Data . . . . . . . . . . . . . . . 4.3.2 Improving Open Government Data Platforms . . . . . . . . 4.3.3 Imbalanced Development of Global Government Data Opening-Up . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.3.4 Improving Guarantee Measures for Open Data . . . . . . . 4.4 Challenges to Open Government Data . . . . . . . . . . . . . . . . . . . 4.4.1 High-Value Data Opening-Up to Be Enhanced . . . . . . . 4.4.2 Digital Divide to Be Closed . . . . . . . . . . . . . . . . . . . . . 4.4.3 Data Upgrading and Maintenance to Be Enhanced . . . . 4.4.4 Great Challenges to Privacy and Security . . . . . . . . . . . 4.4.5 Governmental Collaboration Capability to Be Improved . 4.5 Trends of Opening-Up of Government Data . . . . . . . . . . . . . . . 4.5.1 Deepening of Technology-Driven Government Data Opening-Up . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.5.2 Open Government Data Enhancing the Capability of Governance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.5.3 Open Government Data Ushering in New Industries . . .

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5 World Internet Media Development . . . . . . . . . . . . . . . . . . . . . . . 5.1 Overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.2 Innovation of World Internet Media Technology . . . . . . . . . . . 5.2.1 Application of AI . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.2.2 Application of VR and AR . . . . . . . . . . . . . . . . . . . . . 5.2.3 Application of Blockchain . . . . . . . . . . . . . . . . . . . . . . 5.2.4 Algorithm Innovation . . . . . . . . . . . . . . . . . . . . . . . . . . 5.3 General Situation and Representatives of World Internet Media . 5.3.1 New Media: Increased Credibility in Mainstream Media and Traditional Media . . . . . . . . . . . . . . . . . . . . 5.3.2 Social Media: Crisis of Confidence Facilitating Governance in the Industry . . . . . . . . . . . . . . . . . . . . . 5.3.3 Knowledge Platforms: Audio/Visual Content Increasing, and New Profit Models Being Explored . . . . . . . . . . . . 5.3.4 Audio-Visual Media: More Paying Users . . . . . . . . . . . 5.4 Governance of Fake News on the Internet . . . . . . . . . . . . . . . . 5.4.1 The United States: Cooperation Between Independent Fact-Checking Agencies and Media . . . . . . . . . . . . . . . 5.4.2 The United Kingdom: Collaboration Among the Government, Media, and Nongovernmental Organizations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.4.3 Germany: Joint Checking by Federal Ministry of Justice and Facebook . . . . . . . . . . . . . . . . . . . . . . . . 5.4.4 France: Founding of a Data Checking Center and Cooperation Among Different Parties in Checking . . . . . 5.4.5 Russia: Legislative and Administrative Measures Taken and Its Call on International Cooperation . . . . . . 5.4.6 China: Administrative Regulations Taking the Leading Role . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

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6 World Cybersecurity Development . . . . . . . . . . . . . . . . . . . . . 6.1 Overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.2 Threats to Cybersecurity . . . . . . . . . . . . . . . . . . . . . . . . . . 6.2.1 Upgrading Web Spoofing . . . . . . . . . . . . . . . . . . . . 6.2.2 Continuous DDoS . . . . . . . . . . . . . . . . . . . . . . . . . 6.2.3 Big Threats from Trojan and Botnet Attacks . . . . . . 6.2.4 Malware Attack Remaining a Major Threat . . . . . . . 6.2.5 Active APT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.2.6 Frequent Large-Scale Data Breaches . . . . . . . . . . . . 6.2.7 Intensified IoT Security Risks . . . . . . . . . . . . . . . . . 6.2.8 AI as a Double-Edged Sword . . . . . . . . . . . . . . . . . 6.3 Cybersecurity Protection Measures in Some Countries . . . . 6.3.1 Cybersecurity Strategies and Laws Being Improved . 6.3.2 Cybersecurity Mechanism Construction Being Enhanced . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

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6.3.3 Enhanced Critical Information Infrastructure Security Protection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.3.4 Reinforced Data and Privacy Protection . . . . . . . . . . . . 6.3.5 Talent Production and Cybersecurity Awareness Cultivation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.3.6 Continuous Combat Against Cybercrime and Terrorism . 6.3.7 International Cooperation in Cyberspace . . . . . . . . . . . . 6.4 Development of World Cybersecurity Industry . . . . . . . . . . . . . 6.4.1 Status Quo of World Cybersecurity Industry Development . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.4.2 Measures of Different Countries to Facilitate Cybersecurity Industry . . . . . . . . . . . . . . . . . . . . . . . . . 7 Legal Construction for Internet . . . . . . . . . . . . . . . . . . . . . . . . . . 7.1 Overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.2 Cybersecurity Legislation and Universal Wish to Safeguard Cyber Sovereignty . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.2.1 Accelerated Cybersecurity Legislation . . . . . . . . . . . . . . 7.2.2 Simultaneous Legislation and Standardization of Critical Infrastructure Protection . . . . . . . . . . . . . . . . 7.2.3 Upgraded Data Sovereignty Conflicts Forming a New Area of Cybersecurity Competition . . . . . . . . . . . . . . . . 7.3 Enhanced Cyber Information Supervision and Cyber Service Providers’ Social Responsibility . . . . . . . . . . . . . . . . . . . . . . . 7.3.1 Cyber Information Supervision and Cyber Servicer Providers’ Social Responsibility . . . . . . . . . . . . . . . . . . 7.3.2 Governmental Promotion of Industrial Self-discipline and Countering of Illegal and Fake Information . . . . . . . 7.3.3 Supervision Collaboration and Establishment and Improvement of Law-Enforcing Methods Concerning Cyber Content Administration . . . . . . . . . . . . . . . . . . . 7.4 Legislation on Private Information Protection and Its Backup Mechanism . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.4.1 EU GDPR Having Stirred up a New Wave of Legislation on Personal Information Protection Across the World . . 7.4.2 Enhanced Data Subjects’ Rights Protection and Severe Punishment on Liability Subjects . . . . . . . . . . . . . . . . . 7.4.3 Improved Supporting Rules and Aid Mechanisms Concerning Personal Information Protection . . . . . . . . . 7.5 Standardization of New Technology and New Business to Guarantee Cybersecurity as the Prior Objective . . . . . . . . . . 7.5.1 Laws, Regulations, Strategies, and Policies Jointly Promoting the Development of New Technology and New Business . . . . . . . . . . . . . . . . . . . . . . . . . . . .

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7.5.2 Regulated Virtual Currency Supervision and Industry Chaos . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.5.3 Road Testing Opened up for Automatic Driving and Policies Facilitating Innovative Development . . . 7.6 New Problems and Challenges from Thriving Digital Trade and Relevant Rules Making as a New Issue . . . . . . . . . . . . . 7.6.1 Gradual Construction and Enriching of Digital Trade Rules . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.6.2 Continuous Explorations into Key Issues and Seeking for Common Ground While Allowing Difference as a Consensus . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8 International Cyberspace Governance . . . . . . . . . . . . . . . . . . . 8.1 Overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8.2 Current Problems with International Cyberspace Governance 8.2.1 Immediate Need to Solve the Lagging-Behind Standardization of Global Cyberspace Governance . . 8.2.2 Differences in Governance Models Needing to Be Resolved Through Negotiation and Coordination . . . . 8.2.3 Trust Among the Actors to Be Strengthened . . . . . . . 8.2.4 Development of New Technologies and Applications Having New Demands for International Governance of Cyberspace . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8.3 Progress of International Cyberspace Governance Platforms . 8.3.1 United Nations High-Level Panel on Digital Cooperation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8.3.2 International Telecommunication Union (ITU) . . . . . . 8.3.3 Internet Governance Forum . . . . . . . . . . . . . . . . . . . 8.3.4 Internet Corporation for Assigned Names and Numbers (ICANN) . . . . . . . . . . . . . . . . . . . . . . 8.3.5 World Internet Conference . . . . . . . . . . . . . . . . . . . . 8.3.6 World Economic Forum . . . . . . . . . . . . . . . . . . . . . . 8.4 Participation of Traditional International Organizations in the International Cyberspace Governance . . . . . . . . . . . . . 8.4.1 Group of Twenty Finance Ministers and Central Bank Governors (G20) . . . . . . . . . . . . . . . . . . . . . . . 8.4.2 BRICS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8.4.3 Asia-Pacific Economic Cooperation (APEC) . . . . . . . 8.4.4 Shanghai Cooperation Organization (SCO) . . . . . . . . 8.5 Internet Governance in Some Countries and Regions . . . . . .

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8.5.1 The United States Taking the Lead in Top-Level Design of Cyberspace Strategies and Data Security Protection Legislation . . . . . . . . . . . . . . . . . . . . . . . . . 8.5.2 China’s Continued Pragmatic Participation in Cyberspace International Governance . . . . . . . . . . . . . . . . . . . . . . . 8.5.3 EU Legislation to Strengthen Personal Data and Digital Copyright Protection . . . . . . . . . . . . . . . . . . . . . . . . . . 8.5.4 The United Kingdom Attaching Importance to Cyber Counterterrorism and Achieving Results in Cracking Down on Dark Websites . . . . . . . . . . . . . . . . . . . . . . . 8.5.5 A Multi-level Internet Governance System Formed in Russia . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8.5.6 Rapid Internet Development and Data Protection Legislation in India . . . . . . . . . . . . . . . . . . . . . . . . . . . 8.5.7 Cooperation in Data Privacy Protection Between Japan and EU . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

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Afterword . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 145

Overview

The world is witnessing a new round of technical and industrial revolution. The new-generation technologies represented by big data, AI, blockchain, and quantum computing see their advance each passing day. Faced with the new situation, opportunities, and challenges, all countries are making effort to boost the R&D of emerging technologies to occupy the competition heights of next-generation IT, produce more digital economic dividends, enhance their cybersecurity and improve their capability of developing, using, and controlling the Internet. In the World Internet Development Report 2017, we tentatively set up the Global Internet Development Index (GIDI), making a comprehensive assessment and quantitative analysis of the Internet development of major countries. In the World Internet Development Report 2018, based on the new trends and highlights of Internet development over the past year, we add more countries into the assessed list, in order to reflect more comprehensively, objectively, and accurately the general situation of the world Internet development and thus to provide a reference for all countries in promoting Internet development and governance.

I. General Situation of the World’s Internet Development in 2018 In 2018, ICT represented by the Internet has been integrated in depth into human beings’ life and production. As the leading force for innovation and transformation, it is speeding up the restructuring of the layout of the global economy. In January 2018, the number of global Internet users amounted to 4.021 billion and the Internet penetration rate, 53%.1 To tackle the common issues in Internet development and weaknesses in society and economy, all countries are promoting their informatization and focusing on digital dividends. They keep boosting technical progress, 1

Source: Digital in 2018, https://wearesocial.com/blog/2018/01/global-digital-report-2018.

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industrial upgrading, economic growth, and social development through multiple measures, including infrastructure construction, industrial mode innovation, and rules and standards formulation. 1. Information infrastructure construction is boosted steadily to facilitate global Internet development. The world is in an era of the Internet of Everything. Continuous innovation of ICT, rapid development of digital economy, and increasingly rich information for consumption have brought about higher demand for ICT infrastructure. With the comprehensive upgrading of advanced computing, high-speed interconnection, high-end storage, and smart perception, information infrastructure tends to be fast and smart, witnessing universal coverage. Large-capacity, ubiquitous, space-ground integrated new-generation broadband network infrastructure has been primarily formed, and intelligent application infrastructure is being deployed at a high speed, represented by data centers, cloud computing platforms, CDNs, IoT perception facilities, and Internet exchange centers. ICT infrastructure keeps on being upgraded. Fiber broadband has become the mainstream of fixed broadband, with the number of its users throughout the world amounting to 555 million, accounting for 59.5% of the total number of fixed broadband users. MB broadband is being popularized across the globe and the gigabit network is the new goal. The number of 4G networks and their users in the world is growing steadily. By the end of June 2018, the number of global mobile users had reached 7.84 billion, and the penetration rate of 4G mobile technology, 38%. There is a wave of 5G network upgrading and construction worldwide. Full-function standardization, the first stage of 5G technology, has been finished, and the 5G deployment is at its “home stretch”. All countries are constructing their 5G pilot networks and pilot commercialized networks. 5G networks are expected to be commercialized around the year 2020. Large-scale commercial deployment of IPv6 is being done worldwide at a high speed. By the end of August 2018, the IPv6 deployment rate had amounted to 16.78%, and the average IPv6 deployment rate of TOP 10 cooperators and the IPv6 supporting rate of TOP 50 websites had both reached over 60%, but generally the use rate remains low. International communication network infrastructure is being interconnected rapidly, international Internet exit broadband is seeing fast growth and submarine cables are expanding rapidly. The satellite Internet is witnessing great-leap-forward development, and the compound annual growth rate of high-throughput satellite capacity is 31%. All countries are improving the coverage rate and access ratio of broadband networks in rural and remote areas to narrow the digital gap between urban and rural areas, and to improve the public service and Internet application popularization in rural areas. The quantity of global domain name resources keeps growing, with the top-level domain (TLD) being the highly concentrated market. By the end of March 2018, the number of global domain names had reached over 343 million, with that of top 10 TLDs accounting for 73.2% of the registered total across the world.

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2. All countries attach importance to Internet development, and emerging technologies play an increasingly important role in economic and social development. The year 2018 has witnessed a rapid development of ICT and the accelerated emergence of technological innovations and breakthroughs. ICT has been more deeply integrated with the real economy, which has promoted the new-round technical upgrading in all areas of the economy and society. Informatization is being shifted from digitalization and networking to intelligent development, leading economy and society into the pre-period of intelligence revolution. In the past year, there have been highlights in the development of ICT represented by AI, blockchain, and quantum computing,and there have been new technologies, applications, and business models, which have fostered the ICT industrial chain reforms. The integration of all technologies with each other is the direction of ICT development. Some technologies have mature commercial modes, and their production efficiency and welfare in the economy and society have been improved. Major countries attach great importance to the revolution of ICT, taking it as an important means of boosting their economy. Therefore, they keep formulating, launching, or improving their strategic plans to form or maintain their development advantages in the new-round global competition, and even to succeed in “corner overtaking”. In the technical competition among countries, businesses, Internet businesses, in particular, are the main actors of ICT innovation and application, playing an important role in international competition. With the deepening of economic relationships and foreign trade, the global division of labor and coordination in the field of ICT has become the trend. Cross-national cooperation is popular in technological innovation and cross-national circulation of technical property. Synergistic effect, overflow effect, in particular, is showing itself in ICT innovation. 3. The thriving digital economy is the core driving force for the economic growth of all countries, with its commercial modes being innovated. IT plays an increasingly important role in the integrated transformation and upgrading of traditional industries. Digital economy has become the new energy and new engine for the global economic resurrection. With the emergence of new industries, business models, and modes, the world is seeing the economic development dominated by IT. In 2017, the scale of the global digital economy was US$ 12.9 trillion, with that of the United States and China ranking first and second, respectively. The two countries are the double engines in that field. In subdivision, the market scale of semi-conductors in 2017 was US$ 412. 2 billion, with a year-on-year growth rate of 21.6%; that of cloud computing was US $ 260.2 billion, with a year-on-year growth rate of 18.5%; that of big data was approximately US$ 35 billion, with a year-on-year growth rate of 25%, witnessing great momentum. Global manufacturing is becoming intelligent rapidly. The deep integration between new-generation technologies and manufacturing technologies is accelerating the revolution in production modes. Smart facilities like industrial robots and 3D printing are used extensively. Global intelligent manufacturing in the coming 5 years will see a compound annual growth rate of

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Overview

10%. The e-commerce market worldwide maintains a rapid growth. In 2017 the global online retailing revenue reached US$ 2.3 trillion, with a year-on-year growth of 24.8%. Emerging markets such as Asia, Latin America, the Middle East, and Africa are new growth points in that respect. The deep integration between digital technology and the service industry promotes sharing economy, Internet medical care, online education, and online tourism to thrive, and service outsourcing and smart logistics and other productive services to be digitalized. The huge potential values of Internet platforms attract universal attention, and more and more businesses are fostering their Internet and IoT platforms based on their own advantages to promote the growth of the number of their platforms and their market value. Thanks to financial technologies, a comprehensive and plural financial service system has been set up across the globe, represented by P2P online lending, crowdfunding, the third-party payment, and money management on the Internet. Inclusive finance provides more convenience for micro-, small-, and medium-sized businesses and entrepreneurs. In the digital economy, innovation, cooperation, and win-win are stressed, and globalization is irreversible. It has become the consensus of the international community to oppose trade protectionism and promote international cooperation in information technology. 4. New Internet media forms keep emerging and technology is producing a deeper influence on the forms of media organization and operation. The Internet has deeply been integrated into people’s production and life, changing their lifestyle, thinking habits, and consumption mode. AI and algorithm recommendations are applied in production and delivery, and blockchain and VR have increased the potential of media development. On the other hand, a series of new social problems have occurred and the relationship between technical progress and social development has to be balanced yet. The Internet media industry and the number of global Internet media users and mobile Internet media users keep growing. New media are developing steadily. Mainstream media and traditional news are winning increasing trust from the public, whose trust in the news of social media and search engines, however, they have dropped to the lowest so far. The governance of false news is a global concern. The development of social media has seen its bottleneck, the use rate of such media in the United States, the United Kingdom and France having dropped, and leading businesses in that industry having seen little growth or even reshuffle. Search engines enjoy steady growth and leading businesses in that industry maintain their position, tending to be intelligent, mobile, and algorithm-enhanced. Knowledge platforms are developing fast, with an increasing number of active users. On these platforms, content in graphics and words is shifting to that in audio and visual forms. Their profitability has been increased through advertisement service and paid content, so they may be the next wind gap of the Internet. The number of live game streaming audiences is increasing dramatically, so is that of paid music audiences. The combination of

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VR, AR, and livestreaming is the new hotspot of visual business, and investment in short video and video is increasing. Quality content has attracted capital. 5. There are frequent threats to cybersecurity, which has aroused more attention from all countries, and the cybersecurity industry keeps growing. There are more and more threats to cybersecurity, including cyberattacks, ransom attacks, and data breach. The number and scale of serious cybersecurity incidents keep increasing, posing a challenge to all countries. For instance, the number and scale of DDoS and application-level attacks have increased considerably. The rate of relevant attacks that last over 6 h increased from 9.7% in the third quarter to 12.4% in the fourth quarter of 2017. The number of Trojan and Botnet viruses remains high, and the average number of days when a business is attacked by such viruses has increased from 6.6 to 7.6. Web spoofing and malware keep on being upgraded. In the first half of 2018, 2,308 data breaches were disclosed and about 2, 600 million user records were exposed, so personal information accounts for a large percentage in the total exposed data. Cambridge Analytica, a UK data corporation, obtained data of 87 million users through the open interface of Facebook, which aroused the concern of the international community. Facing the complicated situation of cybersecurity, all countries have adopted a series of protection measures, including the improvement and formulation of cybersecurity laws and regulations, reinforcement of cyber content supervision, protection of critical infrastructure, cultivation and education of relevant talents, enhancement of data and privacy protection, and combat against cybercrime and terrorism. As there are fierce conflicts and competitions in international governance, there are more cyberattacks on important events and critical departments. Cybersecurity is becoming more important in national security, so all countries have channeled it into military security, keeping on increasing the cyberspace deterrence by setting up cyber forces, building cyber military capacity, and increasing investment in national defense. The complicated situation of cybersecurity also highlights the strategic value of the cybersecurity industry, which shows great development potential. In recent years, the industry has been witnessing steady growth. Across the world, the largest scale cybersecurity industry is centered in North America, West Europe, and East Asia. It is boosted in major countries, especially through employment, education and training, and new technologies, and its market becomes mature, thanks to talent cultivation plans, increasing investment, strengthened government-business cooperation, and cybersecurity think tanks. 6. Internet governance witnesses the coexistence of multilateralism and multi-stakeholder model, and consistent rules on the governance have not been formed yet. Internet governance is one of the key geostrategies of major countries. It has developed from a technical issue of political significance into a political issue containing technical elements. All countries, international organizations, technical communities, civil society organizations, and individuals are working

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Overview

together to establish a community of shared future in cyberspace. Over the year, under the impact of anti-globalization trend, the international governance of cyberspace has stepped into the deep water zone. Two models of Internet governance continue to coexist, namely, multilateralism and multi-stakeholder model, and controversy over governance models is deepened. The competition among cyber powers and the practice of all counties have increased the uncertainty of international governance cooperation. The United States has been launching cyber policies, seeking to continue its leading role in the international governance rules concerning cyberspace. EU has made remarkable progress in the cross-border data flow. In particular, the enforcement of General Data Protection Regulation (GDPR) has stirred up a new-round personal information protection legislation. The United Kingdom and Russia are working to enhance their cybersecurity protection and improve their capability of meeting the challenge from the uncertainty of cyberspace. Emerging countries are participating in cyber governance in a variety of forms, with more topics of discussion. They are also boosting their Internet industry. Guided by the “four principles” and “five proposals” put forward by General Secretary Xi Jinping, China takes an active part in building a community of shared future in cyberspace and promoting the favorable reform of international Internet governance. The deep integration of big data, cloud computing, IoT, and AI into economic development has a higher demand for the formulation of international rules on cyberspace and has brought about more topics of discussion on Internet governance. The slow progress in the formulation of international rules on cyberspace, the coexistence of cooperation and competition in data resource protection and commercial application demand, and the worsening of the military situation in cyberspace are hotspots attracting attention. Therefore, there is an immediate need for all countries to find, beyond the conflict in governance models, an inclusive solution to promoting international cooperation and communication in cyberspace and thus realizing joint Internet governance based on mutual trust while gaining mutual benefits and win-win results.

II. Assessment and Analysis of Some Major Countries’ Internet Development The Global Internet Development Index (GIDI) was established only in 2017, so it is a tentative system. In 2017, 38 countries’ Internet development was analyzed in accordance with GIDI while in 2018, another seven countries were involved. All the countries are major economies and the ones with representative Internet development, distributed in the five major continents, so their Internet development can basically reflect the latest Internet development across the world. These 45 countries include

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The Americas: the United States, Canada, Brazil, Argentina, Mexico, Chile, and Cuba; Asia: China, Japan, Republic of Korea, Indonesia, India, Saudi Arabia, Turkey, United Arab Emirates, Kazakhstan, Malaysia, Singapore, Thailand, Vietnam, Pakistan, and Israel; Europe: the United Kingdom, France, Germany, Italy, Russia, Denmark, Estonia, Finland, the Netherlands, Norway, Portugal, Spain, Sweden, Switzerland, Ukraine, and Poland; Oceania: Australia and New Zealand; Africa: South Africa, Egypt, Nigeria, Kenya, and Ethiopia. (Note: Those in bold letters are newlyadded countries in 2018). (I) GIDI Indicators GIDI in 2017 contained 6 first-level indicators, 12 second-level, and 32 third-level ones, which were adopted to assess the Internet development of different countries. To meet the demand of the present Internet development and to show more comprehensively the Internet development of different countries, we, considering the availability of metadata of all indicators, adopt the first-level indicators of 2017, and adjust the second- and third-level indicators along with the data sources and weights. GIDI of 2018 is made up of 6 first-level, 15 second-level, and 32 third-level indicators. The first-level indicators contain six dimensions: infrastructure, innovation capacity, industry development, Internet application, cybersecurity, and Internet governance. Infrastructure mainly refers to each country’s broadband construction; Innovation capacity, to the capability of innovating, including output and potential of innovation; industry development, to the development of the Internet industry in these countries, especially the performance of Internet businesses, which will be the focus of assessment; Internet application, to their Internet application from three dimensions: personal application, business application, and government application; cybersecurity, to their cybersecurity level, covering environment, facilities and industries for cybersecurity; Internet governance, to their management level and their participation in domestic and international cyberspace governance (Figs. 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11). (II) Weight definition Internet development is closely related to infrastructure, innovation capacity, industry development, Internet application, cybersecurity, and Internet governance, which are the major elements influencing Internet development. According to the GIDI, infrastructure is the foundation of Internet development. After years of development, fixed and mobile information infrastructure of all countries has been improving, but no comprehensive statistics have been made on the construction of advanced infrastructures, such as 5G and satellite Internet construction. The weight of infrastructure is defined as 10%. Innovation capacity is the inexhaustible impetus for Internet competitiveness of all countries, and the key

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Overview per capita international Internet bandwidth fixed broadband

average download rate of fixed broadband fixed broadband expenses

Infrastructure

average download rate of mobile broadband mobile broadband

Innovation capacity

mobile broadband construction mobile broadband expenses ICT patent application

innovation output

ICT innovation capacity

innovation potential

number of ICT talents policies and laws

ICT industry environment

commercial innovation ICT added value proportion of ICT service export in global market share

Industry development

ICT industry

proportion of ICT product export in global market share the number of start-ups that have achieved over $1 billion market value Top 100 technology businesses of the world in terms of market value

ICT industry economic effects

influence of ICT on commercial mode influence of ICT on new organizational mode number of Internet users

personal application Internet application

time spent on social media income of online shopping market proportion of mobile payment in the past 30 days

business application

application of ITC in B2B transaction online service index

government application cyber security environment Cyber security

cyber security commitment

cyber security facilities

number of cyber security servers per million people

cyber security industries

ranking of cyber security businesses in the world

domestic governance Internet governance

e-participation index

participation in international governance

organizations related to Internet governance policies and laws concerning Internet governance partcipation in international Internet governance conferences

Fig. 1 Global Internet Development Index

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The United States Infrastructure Internet governance 9.1

1.69

9

Cyber security Internet application

9 18 12.23

Industry development Innovation capacity

Fig. 2 Internet Development Index of the United States

China Infrastructure Internet governance

8.92

1.33

7.09 Cyber security

2.99

13.84

Internet application Industry development

13.48

Innovation capacity

Fig. 3 Internet Development Index of China

to gaining advantages in long-term development. Due to the availability of data, the assessment of innovation capacity is centered on the ICT industry. The weight for this indicator is defined as 20%. Industrial development is the guarantee of sustaining Internet development, and many problems have to be solved in the process of development. The weight of industry development is defined also as 20%. Internet application accounts for the largest percentage, namely 30%, because it is the direct reflection of a country’s Internet development. Cybersecurity is an important guarantee of Internet development, but due to the limited data available,

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Overview

The United Kingdom Infrastructure Internet governance 3.38

9.19

8.11 Cyber security

3.43

13.77

Internet application Industry development

10.26

Innovation capacity

Fig. 4 Internet Development Index of the United Kingdom

Singapore

Infrastructure 4.8 8.71

Internet governance 7.26 Cyber security Internet application

3.16 13.51 9.47

Industry development Innovation capacity

Fig. 5 Internet Development Index of Singapore

we only select three two-level indicators and define its weight as 10%. Internet governance is the guarantee for the orderly development of a country’s Internet and all data concerning it come from Cyber Maturity in the Asia-Pacific Region 2017 issued by the International Cyber Policy Centre of Australian Strategic Policy Institute (ASPI) and the scores given by Chinese experts on other countries in the assessment system in accordance with the scoring rules. The weight of Internet governance is defined as 10%. GIDI indicators and their weights are shown in Table 1.

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Sweden Infrastructure Internet governance 3.76

9.36

8.16 Cyber security Internet application

3.11 12.74 9.33

Industry development Innovation capacity

Fig. 6 Internet Development Index of Sweden

Norway Infrastructure 3.65

9.5

Internet governance 7.39 Cyber security

3.05

Internet application 12.37

Industry development

8.81 Innovation capacity

Fig. 7 Internet Development Index of Norway

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Overview

The Netherlands Infrastructure Internet governance 9.5

7.6

2.29

Cyber security Internet application

3.11

Industry development 13.25 9.48

Innovation capacity

Fig. 8 Internet Development Index of the Netherlands

Switzerland Infrastructure Internet governance

9.5

2.68

8.42 Cyber security

3.09

Internet application 12.59

Industry development

8.83 Innovation capacity Fig. 9 Internet Development Index of Switzerland

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Germany Infrastructure 9.34

8.36

1.96

Internet governance Cyber security

3.12

Internet application 12.59 9.54

Industry development Innovation capacity

Fig. 10 Internet Development Index of Germany

Japan Infrastructure Internet governance

9.13

1.69

8.14 Cyber security

3.1

Internet application 10.05

11.78

Industry development Innovation capacity

Fig. 11 Internet Development Index of Japan

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Table 1 GIDI First-level Indicator

Second-level Indicator

Third-level Indicator

Specification

Source

1. Infrastructure 10%

1.1 Fixed broadband 50%

1.1.1 Per capita international Internet bandwidth 20% 1.1.2 Average download rate of fixed broadband 50%

A country’s Internet construction and development level Average download rate of fixed band users within a certain time length

ITU databases (2016)

1.1.3 Fixed broadband expenses 30% 1.2.1 Average download rate of mobile broadband 40%

Proportion of fixed broadband expenses in GNI Average download rate of mobile broadband users within a certain time length

1.2.2 Mobile broadband construction 40%

Construction level of fixed mobile broadband

1.2.3 Mobile broadband expenses 20% 2.1.1 ICT patent applications 50%

Proportion of mobile broadband expenses in GNI ICT Patent application level and capability Innovation level and capability of the ICT industry Situation of ICT talents Environment for policies, laws, and regulations on ICT industry development Commercial environment for ICT industry development

1.2 Mobile broadband 50%

2. Innovation capacity 20%

3. Industry development 20%

2.1 Innovation output 30%

2.2 Innovation potential 70% 3.1 ICT industry environment 10%

2.1.2 ICT innovation capacity 50% 2.2.1 Number of ICT talents 100% 3.1.1 Environment for policies, laws, and regulations 50% 3.1.2 Commercial innovation environment 50%

Global Digital Report (GlobalWebIndex and other organizations) (2017) ITU databases (2016) Global Digital Report (GlobalWebIndex and other organizations) (2017) Global Digital Report (GlobalWebIndex and other organizations) (2017) ITU databases (2016) World Economic Forum statistics (2014–2015) World Economic Forum statistics (2014–2015) ILO databases (2017) World Economic Forum statistics (2014–2015)

World Economic Forum statistics (2014-2015)

(continued)

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Table 1 (continued) First-level Indicator

Second-level Indicator

Third-level Indicator

Specification

Source

3.2 ICT industry 80%

3.2.1 ICT added value 10%

ICT added value

UN databases (2016)

3.2.2 Proportion of ICT service export in global market share 10% 3.2.3 Proportion of ICT product export in global market share 10% 3.2.4 Number of start-ups with over $1 billion market value 20% 3.2.5 Top 100 technology businesses of the world in terms of market value 50% 3.3.1 Influence of ICT on the commercial mode 50% 3.3.2 influence of ICT on the new organizational mode 50%

Proportion of ICT service export in global market share of that aspect

World Development Indicators(WDI) from the World Bank (2017) World Development Indicators from the World Bank (2017) CB Insights statistic(2018)

3.3 ICT industry economic effects 10%

4. Internet application 30%

4.1 Personal application 40%

4.1.1 Number of Internet users 25%

4.1.2 Time spent on social media 25%

Proportion of ICT product export in global market share of that aspect Number of start-ups with over $1 billion market value Total market value of the latest top 100 technology businesses of the world

21 Data Journalism Laboratory statistics (2018)

Degree to which ICT is used to improve the commercial mode Degree to which ICT is used to improve the organizational mode, such as virtual team establishment and telecommuting Total number of Internet users

World Economic Forum statistics (2014–2015)

Time spent on social media

World Economic Forum statistics (2014–2015)

Global Digital Report (GlobalWebIndex and other organizations) (2017) Global Digital Report (GlobalWebIndex and other (continued)

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Overview

Table 1 (continued) First-level Indicator

5. Cybersecurity 10%

6. Internet governance 10%

Second-level Indicator

Third-level Indicator

Specification

4.1.3 Income of online shopping market 25%

Total income of online shopping market

4.1.4 Proportion of mobile payment in the past 30 days 25%

Proportion of mobile payment

4.2 Business application 30%

4.2.1 Application of ITC in a B2B transaction 100%

4.3 Government application 30%

4.3.1 Online service index 50% 4.3.2 E-Participation index 50%

5.1 Cybersecurity environment 20% 5.2 Cybersecurity facilities 20%

5.1.1 Cybersecurity commitment 100% 5.2.1 Number of cybersecurity servers per million people 100% 5.3.1 Ranking of cybersecurity businesses in the world 100% 6.1.1 Organizations related to Internet governance 50%

Businesses’ application level and capability of ITC in a B2B transaction The government’s online service level People’s online communication with their government Commitment to cybersecurity

5.3 Cybersecurity industries 60% 6.1 Internet governance 60%

Source organizations) (2017) Global Digital Report (GlobalWebIndex and other organizations) (2017) Global Digital Report (GlobalWebIndex and other organizations) (2017) World Economic Forum statistics (2014–2015)

UN statistics (2017) UN statistics (2017)

World Economic Forum statistics (2014–2015)

Number of cybersecurity servers per million people

World Bank database statistics (2017)

Number of cybersecurity businesses in Cybersecurity 500 Organization layout concerning Internet governance, including policies, security, critical infrastructure

Cybersecurity 500 listed by Cybersecurity Ventures(2017) ASPI statistics (2017)and experts’ scoring

(continued)

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Table 1 (continued) First-level Indicator

Second-level Indicator

6.2 Participation in international governance 40%

Third-level Indicator

6.1.2 Policies and laws concerning Internet governance 50% 6.2.1 Participation in international Internet governance conferences 100%

Specification

Source

protection, CERT, crime, and consumer protection Formulation of laws and policies concerning Internet or ISP Participation in international cyberspace workshops, including bilateral and multilateral conferences and other forums

ASPI statistics (2017)and experts’ scoring

ASPI statistics (2017)and experts’ scoring

(III) Result analysis By giving these indicators reference values, we now have the Internet Development Index scores of 45 countries (see Table 2). It is clear that major economies in North America, Europe, and Asia score the highest in terms of average Internet development level. Developing countries in Latin America and Sub-Saharan Africa are stepping up their efforts to catch up. Table 2 GIDI Scores Ranking

Country

Score

1 2 3 4 5 6 7 8 9 10 11 12 13 14

The United States China The United Kingdom Singapore Sweden Norway The Netherlands Switzerland Germany Japan Finland Canada France Denmark

60.00 53.23 52.40 51.23 51.15 49.87 49.74 49.41 49.24 48.75 47.59 46.89 46.44 45.97 (continued)

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Overview

Table 2 (continued) Ranking

Country

Score

15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45

Malaysia Australia Republic of Korea Estonia United Arab Emirates New Zealand Portugal Spain Russia South Africa Italy Israel India Brazil Saudi Arabia Mexico Chile Poland Turkey Thailand Indonesia Vietnam Kenya Egypt Argentina Kazakhstan Nigeria Ukraine Ethiopia Pakistan Cuba

45.91 45.86 45.76 45.29 45.05 44.97 44.61 44.39 43.92 42.59 42.31 42.07 41.84 41.82 41.70 41.51 41.24 41.08 40.88 40.28 40.12 38.81 38.54 38.44 38.43 38.31 36.13 35.83 30.15 30.09 17.00

1. 5G technology is the focus of infrastructure construction, but there is still a digital gap between countries. All countries are expanding the coverage of their information infrastructure. According to the latest statistics of Digital in 2018, the number of Internet users across the globe had amounted to 4,021 million by January 2018, having witnessed an increase of nearly 200 million within one year. Specifically, Europe enjoys mature Internet development, with North Europe having the highest Internet coverage rate, as high as 94%, followed by West Europe, where the Internet coverage

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rate is 90%. Then come North America and South America, with their respective Internet coverage rates at 88 and 68%. The Internet coverage rate in Asia is moderate, about 50%. The Internet infrastructure in African countries is relatively backward and the Internet coverage rate there has to be increased yet. North Africa has the highest Internet coverage rate of the continent, but it is only 49%, while Central Africa has the lowest, about 12%.2 Developed countries with high Internet coverage rates are fostering their advanced information infrastructure systems available everywhere. Europe takes the lead in online download rate and Internet expenses, with the coverage rate of fixed broadband at 97% and that of the 4G mobile network at 91%.3 The average level of infrastructure construction of all countries in that region is the highest in the world, with the focus on the improvement of broadband speed and application coverage of cloud computing for high-capacity and higher-speed data transmission. Developed countries in North America represented by the United States are trying to narrow the digital divide, provide their people with universally available Internet access, and develop global Internet business by relying on their businesses. Google, OneWeb, SpaceX, and Iridium Satellite have started their business in satellite Internet, an emerging area in Internet business, to promote the integrated information infrastructure construction covering the land, the sky, and the sea. They are leaders in global satellite Internet construction. South American countries, such as Brazil, Argentina, and Chile, enjoy accelerated Internet development. The emerging mobile Internet ecology will bring new opportunities for the economic resurrection of Latin America.4 Asia is fostering advanced wireless networks, represented by China, Republic of Korea, and Japan. According to the survey on “5G Network Readiness Index” made by CTIA, the three countries respectively rank first, second, and fourth in that aspect, seizing 5G development opportunities. China, which takes the lead in 5G construction, is trying to speed up the construction and is expected to deploy 5G networks before 2020. Africa lags behind in the Internet penetration rate and has a big digital gap between urban and rural areas, but the growth rate of the number of Internet users there has increased by 20% in the past year. 2G mobile cellular signals cover nearly 90% of its population, and 3G and 4G mobile broadband signals cover nearly 60%.5 Governments of African countries have launched policies on broadband construction and have started cooperation with Google, Facebook, Alibaba, and Tencent in improving the local Internet Infrastructure. In the future, improving the Internet access rate will be the key to the development of the African Internet economy (Table 3–8).

2

https://t.cj.sina.com.cn/articles/view/6426669955/17f0f3383001002tkp. EU: DESI Index, 2018. 4 http://www.chinacelacforum.org/chn/zgtlmjlbgjgx/t1402599.htm. 5 Report on Internet Usability and Availability Growth of Africa, http://news.afrindex.com/zixun/ article9980.html (01/12 2017). 3

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Table 3 Scores of Infrastructure in GIDI Ranking

Country

Score

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40

Singapore Sweden Norway The United Kingdom Estonia Switzerland Finland The Netherlands Denmark United Arab Emirates Germany Spain Canada Russia France Republic of Korea Portugal The United States Japan Australia Kazakhstan New Zealand Chile Italy Turkey Israel Poland China Saudi Arabia South Africa Ukraine Brazil Thailand Argentina Vietnam Malaysia Mexico Egypt Indonesia India

4.80 3.76 3.65 3.38 2.72 2.68 2.52 2.29 2.11 1.98 1.96 1.94 1.90 1.81 1.79 1.78 1.72 1.69 1.69 1.68 1.68 1.62 1.59 1.41 1.41 1.39 1.38 1.33 1.24 1.19 1.12 1.07 1.06 1.06 1.05 1.00 0.99 0.98 0.75 0.75 (continued)

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Table 3 (continued) Ranking

Country

Score

41 42 43 44 45

Kenya Nigeria Pakistan Cuba Ethiopia

0.73 0.68 0.60 0.56 0.50

2. Innovation of commercial mode and product technology drives Internet development. Innovation capacity is a major indicator of the development potential of a country. Generally speaking, the innovation of a business includes commercial mode innovation and product technology innovation. The former is aimed at changing the way of supply to lead the products into existing or new markets; the latter is aimed at creating new technologies through R&D to use technical monopoly as the source of businesses’ competitive advantages. Europeon, North American, and Asian countries represented by Japan, Republic of Korea, and Israel are outstanding in technological innovation. Sweden, Finland, Switzerland, the Netherlands, Denmark, and Norway have got high scores in terms of the innovation capacity of ICT businesses, providing a favorable environment for technological innovation of Europe. Developed North American countries like the United States and Canada input a large number of research resources into innovative Internet businesses and offer support for them. HP and Intel, the earliest ones, and Cisco, Apple, and Google, the latecomers, maintain their leading position in technological innovation. Asian countries like Republic of Korea, Japan, and Israel are leading ones in the world in terms of ICT patent application, promoting their industry development through product technology innovation. Countries with a large population like China and India are more active in commercial mode innovation. The increasingly obvious difference in population base and user type, habit, and demand bring about more opportunities for their commercial mode adjustment and innovation. Therefore, commercial mode innovation is becoming the breakthrough point of Internet businesses’ development and innovation in those regions.6 African countries have become the “blue sea” of investment from developed countries and regions. The arrival and expansion of foreign companies bring opportunities for Internet innovation there. Besides, South Africa, Kenya, and Ethiopia have increased their investment in Internet access and technical education to produce more IT talents to meet the demand for Internet development.

6

Shou Yucheng: Commercial Mode Innovation Is China’s New Breakthrough Point, http://m. hbrchina.org/article/141,11/28/2014.

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Table 4 Scores of Innovation Capacity in GIDI Ranking

Country

Score

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41

The United States Switzerland Germany Israel Sweden Japan The United Kingdom Finland Malaysia France The Netherlands Denmark Canada Norway Republic of Korea Singapore Australia China Indonesia Italy South Africa India New Zealand Portugal Estonia Spain Ukraine Russia Mexico Thailand Saudi Arabia Poland Turkey Argentina United Arab Emirates Vietnam Nigeria Chile Pakistan Kenya Ethiopia

9.00 8.42 8.36 8.35 8.16 8.14 8.11 7.91 7.85 7.69 7.60 7.52 7.39 7.39 7.37 7.26 7.19 7.09 6.91 6.90 6.87 6.83 6.74 6.54 6.53 6.43 6.36 6.21 6.18 6.17 6.12 6.07 5.92 5.90 5.90 5.87 5.85 5.75 5.63 5.49 5.17 (continued)

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Table 4 (continued) Ranking

Country

Score

42 43 44 45

Kazakhstan Brazil Egypt Cuba

5.14 5.03 5.00 0.50

3. Global Internet industry sees unbalanced innovation, with China and the United States as the leaders. Driven by the global Internet technology transformation and innovation, Internet businesses of all countries are growing fast, with those in China and the United States attracting more attention. By May 2018, among the 20 Internet businesses with the highest market value, 9 are from China and 11 from the United States, while 5 years ago, only 2 were from China and 9 from the United States.7 Unicorn companies of the United States are engaged in e-commerce, entertainment, hardware, and security, involving cutting-edge areas like security, data analysis, financial technology, and nanometer technology (NT), mostly controlled by technological innovation businesses, which shows that Internet development in the United States is driven by innovation technology. Unicorn companies of China focus more on product and mode innovation, with larger space for development in areas like software, data analysis, and security demanding high technology.8 The Internet industry of Europe is behind its counterparts, China and North America. Scattered markets, stern supervision, and relatively conservative investors are factors hindering the growth of European Internet businesses. According to the European Digitalization Process Report 2017, only one-fifth of EU businesses are taken as highly digitalized, and the backwardness of digitalization has hindered the innovation and internationalization of traditional industries. Most businesses within the EU are small and medium-sized, but only less than 20% of them use the Internet as their marketing channel.9 The Internet industry in Africa is still at the start-up stage, but it has a broad prospect and great potential. The introduction of advanced technology from other countries is the best way of developing the local Internet industry. Therefore, all countries there pay attention to the introduction of all kinds of high and new technologies.10 7

Queen of Net Report 2018: The gap between China and the United States in terms of Internet industry is narrowing, and among the 20 major technology businesses, 9 are from China, http:// news.stcn.com/2018/0604/14291510.shtml. 8 China Academy of Information and Communications Technology: Report on Internet Development Trend (2017–2018), pp. 10–11. 9 International observation: EU Facing Challenges to Its Digital Market Construction, http://www. xinhuanet.com/world/2017-09/30/c_1121753855.htm(30/09/2017). 10 African Internet Development Has Got Its Foundation, so How Should Chinese Businesses Expand Their Business There? https://bg.qianzhan.com/report/detail/300/161203-3643db94.html.

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Table 5 Scores of industry development in GIDI Ranking

Country

Score

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40

The United States China The United Kingdom Singapore The Netherlands Finland Sweden Germany Switzerland Norway Canada Malaysia Israel New Zealand Estonia Republic of Korea France Japan Denmark Australia United Arab Emirates Portugal Spain Chile India Indonesia Saudi Arabia South Africa Poland Turkey Mexico Kenya Kazakhstan Thailand Vietnam Russia Italy Brazil Ukraine Nigeria

18.00 13.84 13.77 13.51 13.25 13.13 12.74 12.59 12.59 12.37 12.25 12.13 12.12 11.93 11.92 11.83 11.81 11.78 11.49 11.36 11.30 11.13 10.79 10.69 10.31 10.14 10.07 9.74 9.64 9.62 9.57 9.52 9.51 9.43 9.31 9.31 9.17 9.03 8.89 8.42 (continued)

Overview

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Table 5 (continued) Ranking

Country

41 42 43 44 45

Pakistan Argentina Egypt Ethiopia Cuba

Score 8.40 8.28 7.88 7.69 0.50

4. Developed and developing countries have different Internet application focuses, with governmental and business application as the key in the former and personal application in the latter. Internet application is an important means of guaranteeing and improving people’s livelihood. In European countries, the Internet is more applied to the government. For instance, Denmark, Finland, Norway, Estonia, France, and the United Kingdom are among the top ones in scores of online service and e-participation, with their e-government service expanding and their people having more sense of gains in sharing Internet development results. The United States and Canada are leaders in the business application of the Internet. They have made incentive strategies to speed up the innovation of digital technology, products, and services and to support businesses’ digital transformation. Asian countries like China, Indonesia, Thailand, and Malaysia and Latin American countries like Brazil and Argentina are more active in personal application, with their social media use frequency and intensity obviously higher than those of other countries and regions. China takes the lead in the digital economy, with its e-commerce transaction volume accounting for over 40%, higher than the total of the United Kingdom, the United States, Japan, France, and Germany. Its mobile payment penetration rate keeps increasing fast, while its mobile payment transaction volume related to personal consumption amounts to US$ 790 billion, 11 times that of the United States.11 With the popularization of cheap mobile phones on the African continent, the personal mobile Internet application rate there keeps increasing, and more and more people begin to use the Internet for entertainment, work, and information query. Mobile payment is witnessing an amazing increase in Kenya and Tanzania, with about 300 million people having mobile wallets. The local e-commerce market is thriving, with giant businesses emerging one after another, for instance, Takealot in South Africa, Kilimall in Kenya, and Jumia and Kaymu in Nigeria.12

11

McKinsey & Company: Secret of digital China’s Leading the World. Great potential and challenges coexist in e-commerce of Africa, and Chinese Internet businesses aim for joint development, http://www.100ec.cn/detail–6469868.html, 09/07/2018.

12

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Table 6 Scores of internet application in GIDI Ranking

Country

Score

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41

China The United States The United Kingdom Japan Estonia United Arab Emirates Malaysia Germany The Netherlands Singapore Sweden Finland Canada Brazil New Zealand Portugal India Australia South Africa Mexico Republic of Korea Switzerland France Chile Saudi Arabia Norway Thailand Indonesia Turkey Denmark Russia Vietnam Spain Israel Kenya Egypt Italy Nigeria Poland Argentina Kazakhstan

13.48 12.23 10.26 10.05 10.01 9.97 9.78 9.54 9.48 9.47 9.33 9.24 9.11 9.02 8.98 8.97 8.97 8.90 8.90 8.86 8.84 8.83 8.83 8.82 8.82 8.81 8.80 8.78 8.66 8.65 8.65 8.36 8.34 8.25 8.25 8.17 7.68 7.67 7.54 7.25 6.95 (continued)

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Table 6 (continued) Ranking

Country

Score

42 43 44 45

Ukraine Pakistan Ethiopia Cuba

6.41 5.48 5.06 0.20

5. Cybersecurity is universally stressed but there are obvious advantages in developed countries, the United States in particular. The security of information technology has been attracting universal attention and the scope of the cybersecurity industry has been expanding in line with the demand for cybersecurity. The scale of the global cybersecurity industry keeps increasing. According to Gartner, it was estimated to be US$ 98.986 billion in 2017, an increase of 7.9% in comparison with that of 2016, and it will increase to US$ 106 billion in 2018.13 North America, West Europe, and the Asian-Pacific Region witness the same scale, with their total market share amounting to over 90%. The scale of North America represented by the United States and Canada reached US$ 40.876 in 2017, an increase of 9.2% in comparison with that of 2016, accounting for 41.29% of the global total, the highest of the world. The scale of 16 West European countries, including the United Kingdom, Germany, and Finland, amounted to US$ 26.729 billion in 2017, with a year-on-year increase of 6.5%, accounting for 27% of the world’s total. The scale of 10 Asian countries, including Japan, Australia, China, and India, amounted to US$ 22.508 billion in 2017, with a year-on-year increase of 9.5%, accounting for 22.7% of the world’s total. The scale of Africa, East Europe, and Latin America amounted to US$ 8.874 billion in the same year, accounting for 8.97% of the world’s total. Since 2017, there have been frequent accidents concerning cybersecurity in the world, so all countries attach great importance to it, taking a variety of measures to strengthen their security protection. Europe takes the lead in cybersecurity protection, having advantages in relevant legislation and technology R&D. In North America, cybersecurity protection capability varies from country to country. The scale of the cybersecurity industry of the United States and Canada accounts for more than two-thirds of the global total, and their input in cyber force deployment, cyber technology R&D, and cybersecurity budget is higher than that of other American countries, with the United States being the leader in the strength of cybersecurity businesses. Mexico ranks third in cybersecurity in North America, having established complete legislation systems concerning cybercrime, data protection, and online transaction, but still having a long way to go to catch up with the United States and Canada.

13

Gartner Information Security, Worldwide, 2015–2021, https://www.secrss.com/articles/1790.

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Asian countries represented by Singapore, Malaysia, and Israel have got rich experience in cybersecurity capacity building. Singapore started to build its cybersecurity capacity as early as in 2005, and in 2015 founded Cyber Security Agency (CSA), which is in charge of supervising local cybersecurity. It tries to build its cybersecurity capacity in cyber information legislation, system and team construction, talent cultivation, and international cooperation, so it ranks among the top of the world in terms of cybersecurity. CyberSecurity Malaysia, the institution of Malaysia in charge of cybersecurity, stresses training concerning cybersecurity throughout the country to improve the people’s awareness of cybersecurity. Israel takes cybersecurity as the key area in foreign trade and continues to expand the export of cybersecurity technology products. Cybersecurity capacity in Africa is generally weak. Countries like Kenya maintain good bilateral or multilateral cooperation with international organizations or other countries through National KE-CIRT/CC, which provides a shortcut for other countries to improve their cybersecurity. Table 7 Scores of cybersecurity in GIDI Ranking

Country

Score

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24

The United States Israel The United Kingdom Canada France Singapore Germany Sweden The Netherlands Japan Switzerland Australia Malaysia Estonia Republic of Korea Finland Norway Spain Russia New Zealand China India Denmark Egypt

9.00 3.56 3.43 3.27 3.16 3.16 3.12 3.11 3.11 3.10 3.09 3.09 3.09 3.06 3.06 3.05 3.05 3.03 3.03 3.00 2.99 2.98 2.98 2.95 (continued)

Overview

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Table 7 (continued) Ranking

Country

Score

25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45

Italy Thailand Poland Mexico Turkey Brazil United Arab Emirates South Africa Portugal Nigeria Saudi Arabia Ukraine Argentina Kenya Chile Indonesia Kazakhstan Pakistan Vietnam Ethiopia Cuba

2.95 2.94 2.93 2.93 2.92 2.91 2.90 2.90 2.89 2.88 2.87 2.87 2.85 2.85 2.82 2.80 2.80 2.76 2.69 2.63 2.50

6. America and Europe still hold an advantageous position in international Internet governance while China and Russia are witnessing increasing participation. Currently, there is no powerful leading country that can promote the formulation of international rules on cyberspace. EU, with over 500 million Internet users, is an important balance-checking force in international cyberspace governance. All European countries have performed well in monopoly combating and data protection since General Data Protection Regulation (GDPR) came into effect.14 China has accelerated its integration into international cyberspace governance and witnessed good results. It has become the consensus of the international community to build a community of shared future in cyberspace. Particularly, among Shanghai Cooperation Organization and ASEAN countries, China has a strong capacity for agenda setting in terms of Internet governance. In the new edition of Doctrine of the Russian Federation’s Information Security published at the end of 2016, Russia explicitly pointed out the defects of the present Internet governance. In 2017, it not only put forward the proposal on changes, but 14

A Review on the General Situation of International Internet Governance in 2017, http://www. sohu.com/a/224822148_468736,03/04/2018.

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Overview

also tried at international conferences to promote the construction of international cybersecurity standards and suggested setting up backup global domain name systems covering all BRICS countries. With the increasing popularization of the Internet on the African continent, all actors there have begun to speed up the design of institutional frameworks concerning Internet governance,15 and launched policies on personal information protection and combating cyberterrorism and cybercrime, but they have to improve their capability of execution. Table 8 Scores of internet governance in GIDI Ranking

Country

Score

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27

The Netherlands Norway Switzerland Sweden Germany The United Kingdom Japan The United States France China Australia Italy Canada Russia Denmark Spain Republic of Korea Singapore Portugal Poland New Zealand Finland Brazil Malaysia South Africa United Arab Emirates Argentina

9.50 9.50 9.50 9.36 9.34 9.19 9.13 9.10 8.92 8.92 8.92 8.85 8.81 8.81 8.81 8.81 8.71 8.71 8.53 8.49 8.49 8.42 8.40 8.35 8.12 7.98 7.97 (continued)

15

A Tentative Study of African Cyber Security Governance, http://www.iwep.org.cn/xscg/xscg_ lwybg/201703/t20170302_3437622.shtml, 03/02/2017.

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Table 8 (continued) Ranking

Country

Score

28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45

Mexico Saudi Arabia India Kazakhstan Egypt Turkey Chile Thailand Kenya Estonia Indonesia Vietnam Israel Ukraine Nigeria Cuba Ethiopia Pakistan

7.96 7.86 7.81 7.72 7.64 7.59 7.40 7.36 7.32 7.23 7.18 7.18 7.00 7.00 6.72 6.25 6.25 5.50

III. Internet Development of Some Representative Countries By comparing the scores of 45 countries, we see that the major economies in North America, Europe, and Asia enjoy the highest level Internet development, while Latin America and Sub-Saharan Africa are making their efforts. The top ten countries in GIDI scores are taken as examples for analysis in the present part. (I) The United States remains the leader in the comprehensive strength of Internet development. As an Internet power of the world, the United States has been taking the lead in the innovative development of Internet technology and in cybersecurity governance. Ranking first in GIDI, it is one of the leaders in innovation capacity, industry development, Internet application, and cybersecurity. But it ranks 18th in terms of Internet infrastructure due to a big digital gap within the country. In terms of information infrastructure, the United States has a mature mobile Internet market. Internet operators like Verizon and AT&T are upgrading their mobile technology. It is expected to provide 5G service between 2018 and 2019, and thus to seize the opportunity to develop 5G technology as the first country in that aspect. In the United States, fixed broadband construction has always attracted investment from governments and businesses, so they can provide fast and payable

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broadband service to the people. However, the big digital gap between urban and rural areas is hard to close. In terms of technological innovation, the country pays more attention to the role of private sectors’ self-dependent innovation and to the weakening of governmental guidance. Businesses are encouraged to input R&D funds, so they have controlled all commanding heights from basic technologies to cutting-edge ones.16 According to World Top 2500 R&D Investors 2017 released by the EU, among the top 100 businesses, 36 are from the United States, the number ranking first. Obviously, US businesses attach importance to R&D investment and technological innovation. A large number of top talents have contributed to the development of technological innovation. Among the top 1,000 leading computer scientists, 632 are working in the United States. The top 20 are almost all American specialists.17 In terms of industry development, the country is ahead of other countries. According to the latest ranking of Internet businesses in terms of market value, 11 out of the top 20 technical giants are from the United States, including the top five. The market value of the US Internet businesses accounts for 75% of the global total, far more than the total of all other countries.18 Relying on Internet giants like Apple, Amazon, Google, Microsoft, and Facebook, the United States has been improving the overall competitiveness of its Internet businesses, taking the lead in Internet industry development. The United States is a big country of Internet application, with its Internet penetration rate reaching 88% of the whole population and online shopping population accounting for 65%.19 Application of e-commerce, e-government, digital content, and social media is thriving. According to the Internet Advertising Revenue Report released by IAB and PWC, the Internet advertising revenue of the United States in 2017 was US$ 88 billion, with a year-on-year increase of 21.4%, making the country the biggest Internet advertising market of the world, and 88% of young people there use all kinds of social platforms, with the use rate of YouTube amounting to 75%.20 In terms of cybersecurity, Hillary Clinton’s Email Controversy and the frequent hackers’ attacks on the network system of the National Committee of the Democratic Party during the presidential election of 2016 have made cybersecurity a great concern of American voters. After Trump became the president, the cybersecurity architecture was established with the White House, Department of 16

Dong Yanchun, et. al.: Trends of American Technical Innovation Policies during Trump’s Presidency, Forum on Science and Technology in China, http://wemedia.ifeng.com/40416648/ wemedia.shtml. 17 Most influential H-index released by Guide2Research, http://www.guide2research.com/ scientists/. 18 Top 20 Global Internet Giants Are All in the Two Countries, https://wallstreetcn.com/articles/ 3356861, 07/10/2018. 19 Digital in 2018 in Northern America, https://www.slideshare.net/wearesocial/digital-in-2018-innorthern-america-86863088. 20 IAB: Internet Advertising Revenue Report 2017, http://www.199it.com/archives/725875.html, 05/30/2018.

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Defense, and Department of Homeland Security as the core, and staff and agencies were all adjusted. Totally, over 10 policies and laws have been launched. For instance, in 2017, Executive Order of Strengthening the Cybersecurity of Federal Networks and Critical Infrastructure and National Security Strategy Report and other strategic documents were issued, together with nearly 100 critical reports concerning all kinds of think tanks and cybersecurity. In terms of Internet governance, the US government shows concern about the following aspects: development of digital economy and perfection of the Internet infrastructure; security of cyber content, prevention of cyber interference with politics, promotion of ideological propaganda, and safeguard of democracy; and development of new technologies like AI, IoT, blockchain, and 5G, and formulation of new regulations on them.21 (II) China is becoming an emerging Internet power. China’s Internet development is only behind that of the United States, with Internet application (ranking 1st) and industry development (ranking 2nd) as the most remarkable ones. It has got experience in Internet governance (ranking 9th, tying), but has to improve its infrastructure (ranking 28th), innovation capacity (ranking 18th), and cybersecurity (ranking 21st). China’s network infrastructure keeps on being improved. With the strategy of “Broadband China” and the policy of “facilitating faster and more affordable Internet connection” being implemented, the country is implementing new-generation information infrastructure construction projects and broadband improvement projects in rural and remote areas to foster advanced information infrastructure system universally available. In 2017, the household fixed broadband popularization rate reached 72%, and poor village broadband network coverage rate was over 90%.22 China has established the world’s largest fixed fiber network and 4G network, expected to make more breakthroughs in 5G areas. However, it has to improve its Internet construction. Among the 400 submarine FLAG systems, there are only 9 lands in China. Besides, the country’s international exit broadband construction remains slower than the increase in market demand.23 In terms of innovation capacity, China has seen a remarkable improvement in its self-dependent innovation capacity concerning core technologies. In 2016, it applied for 43,100 international IT patents, ranking third in the world. Its innovation index has risen to 22nd place, on the top list of the world. However, it needs to

21

Gui Changni: Review, Features and Prospect of Trump’s Cyber Security Governance, https:// www.secrss.com/articles/990,02/23/2018. 22 Zhou Jian, et. al. Key Tasks and Projects Are Being Implemented concerning Digital China, http://www.sohu.com/a/231248053_286727. 23 China’s Internet Giants Are Absent from Marine Cable Layout and International Exit Broadband Becomes the “Short Board”, https://tech.sina.com.cn/t/2018-09-28/docihkmwytp5747341.shtml, 2018.0928.

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catch up in deep, comprehensive technological innovation, for instance, in the field of software.24 Its innovation is more manifested in commercial mode, which produces a great impact on industry development, so the innovation of commercial mode is taken as an indicator of industry development rather than that of innovation capacity. China’s innovation capacity ranks 18th in the world. In terms of industry development, the overall strength and global competitiveness of China’s Internet businesses keep improving, with seven of them listed in the world’s top 20 in terms of market value. Its digital economy is thriving, ranking second in the world. The scale of its digital economy was RMB 27.2 trillion yuan in 2017, with a year-on-year increase of 20.3%, accounting for 32.9% in the national GDP.25 China’s Internet businesses’ innovation and entrepreneurship are taking the lead in the world. According to the Global Unicorn List released by CB Insights, the country has 62 unicorn businesses, mainly Internet and e-commerce ones. The number is only next to that of the United States, which has 113 unicorn businesses, and is much higher than that of the United Kingdom (13, ranking third) and India (10, ranking fourth). China takes the lead in a mobile Internet application, which has profoundly changed traditional industries such as transportation, medical care, catering, costume, and tourism. Innovative mobile Internet business is the hotspot in the whole mobile Internet industry and society, and mobile payment can be done in all consumption areas, with the transaction scale amounting to RMB 200 trillion yuan, ranking first in the world. People-beneficial and friendly services are speeding up and integrated online and offline governmental services have been formed, with 31 provincial online governmental service platforms launched.26 China also has the largest video game market, whose total income in 2018 has reached US$ 37.9 billion. China attaches great importance to cybersecurity and Internet governance. With the launching and implementation of backup regulations and policies of Cybersecurity Law of the People’s Republic of China, the country has seen great progress in legal construction concerning cybersecurity and Internet governance. However, in the two areas, it has a long way to go to catch up with developed countries in facilities construction and core and key technology R&D. (III) The Internet of the United Kingdom develops steadily. In GIDI of 2018, the United Kingdom ranks third. The country has a good foundation for Internet development, and thus balanced development concerning all indicators. Specifically, it ranks 4th in infrastructure, 7th in innovation capacity, 3rd in industry development, Internet application and cybersecurity, and 6th in Internet governance. Therefore, it is among the top countries in overall Internet development. 24

Cyberspace Administration of China:Report on Digital China Construction (2017). The scale of digital economy ranks second of the world: China is becoming a digital power, http://www.xinhuanet.com/fortune/2018-04/27/c_1122750302.htm, 2018.4.27. 26 Cyberspace Administration of China: Report on Digital China Construction (2017). 25

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The United Kingdom enjoys developed network infrastructure. It has proposed the connection strategy in the UK Digital Strategy, and invested £1.7 billion in broadband construction, with over 90% of business sites accessing super-speed broadband. It has also invested over £ 5 billion to increase the 4G signal coverage rate. It is promoting 5G standard R&D and network deployment, and will invest £ 400 million in new digital infrastructure construction to realize the coverage of fiber broadband networks throughout the country.27 As the original place of Modern Technical Revolution and Industrial Revolution, the United Kingdom has a good tradition of science, which lays a solid foundation for the country’s becoming a technical power. Attaching importance to Internet technology innovation, with the focus on AI technology R&D, it is committed to fostering itself into the global center of AI. In April 2018, it released Industrial Strategy: Artificial Intelligence Sector Deal, and a supporting plan of £ 950 million to boost AI development.28 In terms of Internet application, it ranks first in Europe. The network penetration rate as high as 95% has promoted the country’s e-commerce, which accounts for the major part of the market share of Europe’s e-commerce. A report of Ecommerce Foundation points out that the market share of the United Kingdom’s e-commerce keeps increasing and the proportion of local online retailing turnover in the total retailing turnover has increased from 14.7% in 2016 to today’s 16.4%.29 It is one of the earliest countries that started e-government research and practice, having made striking achievements in e-government. According to United Nations E-Government Survey 2018, the country’s e-government level ranks fourth in the world and its e-participation and online service indexes are also on the top of the list. The country is committed to becoming the global excellence center of cybersecurity, appropriating over £ 300 million for cybersecurity affairs every year. Cylon, the world’s first cybersecurity incubator, has been established there, taking the cyber defense capacity building as its primary goal. In March 2018, the UK government released the Cyber Security Export Strategy to promote its strength in network technology, to reinforce the country’s and its partners’ cyber defense capacity through cybersecurity expertise, and boost relevant product export to other countries through the new cybersecurity export strategy.30

UK Digital Strategy: fostering the first-class digital economy, http://wemedia.ifeng.com/ 40840479/wemedia.shtml, 12/13/2017. 28 The United Kingdom Releases the AI Industry Strategy, http://www.casisd.cn/zkcg/ydkb/ kjzcyzxkb/2018/201807/201806/t20180612_5025268.html, 06/12/2018. 29 The United Kingdom’s E-commerce Market Remains the Leader of Europe, https://www. asendia.hk/cn/news-united-kingdom-b2c-ecommerce-report-2018/, 05/10/2018. 30 The United Kingdom Releases the Cyber Security Export Strategy, https://www.easyaq.com/ news/35063220.shtml, 03/29/2018. 27

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(IV) Singapore’s Internet infrastructure construction attracts attention. Singapore is among the leading countries of the world in terms of Internet development, ranking fourth of the 45 assessed countries. It ranks 1st in infrastructure, 16th in innovation capacity, 4th in industry development, 10th in Internet application, 5th (tying) in cybersecurity, and 17th (tying) in Internet governance. Singapore is always committed to becoming the ICT leader in Southeast Asia, with a highly developed mobile market, advanced Internet technologies, and super-low Internet access price. As the ICT center of Southeast Asia, it is the leader of the world in per capita Internet broadband, whose speed is as high as 982.9 kbit/s. International exit broadband is one of its advantages in Internet development. According to the global broadband speed ranking released by M-Lab, Singapore ranks first, with its average download rate as high as 60.39 Mbps.31 It has an active Internet application market. Grab, a taxi platform, provides services like transportation, food and shopping delivery, and e-payment, having become one of the largest mobile payment platforms of Southeast Asia.32 SpherePay, a mobile payment app, enables consumers and businesses to make cashless payment and P2P account transfer, having become one of the most frequently used local mobile payment apps.33 The government has launched services, such as SingPass Double Certification System, One Inbox E-mail, One Service Mobile App, and My Info (for personal information storage) to carry out the philosophy of holistic government and to provide the maximum convenience for its people.34 Singapore takes cybersecurity as the key to the development of the digital economy and society, taking the lead in cybersecurity in the Asia-Pacific Region. As early as 2005, it released the first cybersecurity plan. In 2015, Cyber Security Administration (CSA) was founded to coordinate the cyber security of all governmental departments; in 2016, the Cybersecurity Strategy was released to strengthen the domestic cybersecurity guarantee. In February 2018, the Parliament passed Cybersecurity Act 2018 to establish the framework of supervision over critical information infrastructure owners and mechanisms for cybersecurity information sharing, response to and prevention of cybersecurity incidents, and cybersecurity service permission. It is a comprehensive and unified cybersecurity law in the country.35

Global Broadband Speed Ranking: Singapore is the first and the Chinese Mainland, 14th, 1https://tech.sina.com.cn/t/2018-08-13/doc-ihhqtawy1117735.shtml, 08/13/2018. 32 https://news.nestia.com/detail/-/277651. 33 https://www.lieyunwang.com/archives/408688. 34 Experience and Enlightenment from Singapore’s Promotion of “Internet + Governmental Service, E-Government [J]. 35 Cybersecurity Act 2018 of Singapore has been officially passed, https://www.secrss.com/articles/ 1169,03/03/2018. 31

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(V) Sweden has a remarkable environment for Internet technology innovation. Sweden ranks fifth among the 45 assessed countries. It ranks 2nd in infrastructure (among the leading ones), 5th in innovation capacity, 4th in Internet governance, 7th in industry development, 11th in Internet application, and 8th in cybersecurity, the latter three being relatively weak. Sweden is one of the European countries with the most mature mobile and broadband networks, with the most developed LTE infrastructure, and high fiber broadband penetration rate of 91.5%, far higher than the average rate of Europe, which is only 77.9%.36 It is one of the leading countries in mobile networks. Ericsson has got an EU loan of 250 million euros for the R&D of 5G technology to improve the competitiveness of Europe in telecommunication. The world’s first 5G phone call was officially made in the laboratory of Ericsson in September 2018, which is a milestone in 5G technology development. The expenditure on the use of fixed broadband accounts for 0.9% of Sweden’s GNI and that on the use of mobile broadband (500 MB) accounts for 0.1%, both lower than the average European level, which is, respectively, 1.2 and 0.6%. These achievements put Sweden’s Internet infrastructure in second place in GIDI. According to the global innovation index released by WIPO in 2017, Sweden is one of the countries with the highest innovation capacity, outstanding in human resources and research, infrastructure, and commercial maturity.37 As one of the global technological innovation centers, the country has unicorn technical businesses, such as Spotify, Klarna (an online payment business), and King (a game business). Sweden enjoys a high level of Internet application. According to Digital Economy and Society Index (DESI) 2018 released by the EU, it ranks second of the EU countries in the dimensions such as online news browsing, music video, online shopping, and online banking.38 Internet application of its businesses and government can match the advanced level of the world, especially in terms of digital currency. It will probably be the first society free of cash in the world. In 2013, it abandoned the paper money with the highest nominal value, which boosted the fast rise of cellphone payment software. According to the Central Bank of Sweden, they will launch the national digital currency E-Krona, which will be used for small transactions between consumers, businesses, and governmental agencies. The currency is expected to be put into use in 2019. (VI) Norway has a solid foundation for Internet development. Norway ranks sixth among the 45 assessed countries. It ranks 3rd in infrastructure, 13th in innovation capacity, 10th in industry development, 26th in Internet application, 16th in cybersecurity, and 1st (tying) in Internet governance.

36

ITU: Measuring the Information Society Report 2017. WIPO: http://www.wipo.int/pressroom/zh/articles/2017/article_0006.html, 06/15/2017. 38 EU: Digital Economy and Society Index (DESI) 2018, 05/18/2018. 37

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The Norwegian government has been promoting Internet broadband construction in recent years. Because of the low population density, it is an attractive way to provide broadband for rural or remote areas through mobile technology. In 2016, the government released the Digital Agenda of Norway, a white paper about ICT, in which it is made clear that they will foster the world-class electronic communication networks and service infrastructure. Now, the country’s mobile broadband speed is taking the lead in the world. According to the Speed Test Global Index released in December 2017 by Ookla, a famous American speed test business, Norway’s mobile broadband speed is the highest, with the download speed at 61.20 Mbps, much higher than the world’s average, which is 21.25 Mbps.39 The government always attaches importance to investment in education, boasting developed higher education, a big number of research and innovation talents, including ICT and IT development talents, and a large number of patents. As a mature market of mobile data services, Internet, and application software, the country enjoys good opportunities for development, thanks to its solid R&D strength. The precious resources for Internet innovation as mentioned above will contribute to the development of big data, IoT, and AI technologies of Norway. ICT was developed in Norway, where the information and telecommunication industry is the third largest industry and the key source of growth, innovation, and improvement of the overall social productivity. The country is also outstanding in ICT export, committed to becoming a leading market of digital service. It is among the top countries in terms of digitalization in public spheres. Its digital government plan is aimed to simplify and improve the service of public sectors through ICT development. According to E-government Development Index (EGDI) 2018 released by the UN, Norway ranks 14th, one of the leading countries in e-government. The citizens there have high satisfaction with and expectation of that. Norway stresses the cultivation of public cybersecurity awareness. In recent years, the government has been holding every year the National Security Month to publicize the importance of cybersecurity, enhance the peoples’ and businesses’ awareness of threats to cybersecurity, and make them knowledgeable about the preventions, so that the cyberspace there is more secure. National Security Agency of Norway is the key institution in charge of analyzing and preventing threats to national security. Its National Network Center is the core department for preventing cyberattacks and safeguarding national information security.40 As for Internet governance, the country has adopted regulatory methods guided by the government. A three-level supervision mechanism has been formed, involving the public, the police, and the army, who are in charge of monitoring and reporting Internet behaviors violating regulations. In this way, a good result has been achieved.41 Norway has strict regulations and efficient law enforcement to 39

http://world.people.com.cn/n1/2018/0111/c1002-29759357.html. http://www.xinhuanet.com/2016-04/14/c_1118622833.htm. 41 Cyber-censorship in Norway, https://hannemyr.com/censorship-in-norway,09/13/2017. 40

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ensure orderly competition in the Internet market. In June 2018, Norwegian Telecom, one of the largest telecommunication operators of the country, was fined 788 million Norwegian kroner (approx.US $ 96 million) for having abused its market advantages. It has been the ticket with the highest fine written by the Norwegian Competition Authority.42 (VII) The Netherlands has obvious advantages in Internet governance. The Netherlands ranks seventh among the 45 assessed countries. It ranks 8th in infrastructure, 11th in innovation capacity, 5th in industry development, 9th in Internet application, 8th (tying) in cybersecurity, and 1st (tying) in Internet governance. The Netherlands has advanced Internet infrastructure, especially in international Internet construction. Most trans-Atlantic marine cables connecting Europe and North America lead to the country directly. AMS-IX located in Amsterdam is one of the biggest Internet exchange centers in the world, and the largest of its kind in Europe.43 In terms of industry development, the solid foundation for the network connectivity of the country has helped to attract investment from so many international companies, and more than 170 ICT providers have chosen Amsterdam as their bases in Europe.44 Therefore, the Netherlands has an attractive ICT industrial environment and economic effect. Businesses use digital technologies there and provide all kinds of convenient service for the public through platforms. The country makes an active response to the calling of the EU for personal data protection. After GDPR of EU was officially put into effect, the National Data Protection Authority made an exploratory investigation in accordance with Article 30 (Record of Handling) of GDPR into 10 private industries, namely, industry and metal, water supply, construction, trade, catering, tourism agency, telecommunication, financial service, commercial service, and medical and health care, to see whether they kept records of their handling and whether the records were accurate and to know about the corporate data protection officer appointment and influence of data protection on assessment.45 The Dutch government takes an active part in the formulation of international Internet rules. It sponsored the formation of the Global Commission on the Stability of Cyberspace, which is made up of over 40 prestigious figures in cyberspace from nearly 20 countries. The commission offers pieces of advice on the formulation of international Internet rules.46

42

http://www.xinhuanet.com/world/2018-06/22/c_129898950.htm. http://nl.mofcom.gov.cn/article/jmzn/mytzhj/201507/20150701038742.shtml. 44 http://dc.idcquan.com/jfjs/136425.shtml. 45 https://www.secrss.com/articles/4525. 46 https://www.secrss.com/articles/1221. 43

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(VIII) Switzerland has become a global leader in data protection. Switzerland ranks eighth among the 45 assessed countries, with its outstanding innovation capacity and Internet governance ranking 2nd and 1st, respectively. Due to the small population, it has a small scale of Internet application, only ranking 22nd. It ranks 6th in infrastructure, 8th (tying) in industry development, and 11th (tying) in cybersecurity. Switzerland boasts developed infrastructure, and mature and competitive telecommunication. The coverage rate of broadband at the speed of over 10Mbps is 98%, ranking first in the EU, whose average coverage rare of the same kind is only 55%.47 The Internet access price in Switzerland is user-friendly. People’s expenditure on fixed broadband only accounts for 0.6% of GNI; that on 500 MB mobile broadband, 0.3%; that on 1G mobile broadband, 0.6%, all lower than the European average.48 Now the country is working for 5G technology and the supervision agency will auction 5G frequency spectrum early next year. Swisscom has invested about 1.75 billion Swiss francs (approx. US$ 1.85 billion) in network expansion and plans to complete the modernized restructuring of fixed networks by the end of 2021.49 Though it has no advantage in ICT patent application and number of talents, Switzerland has made progress in technological innovation capacity of businesses. Considering its highly developed financial system, it will expand the development of financial technology and channel blockchain into the whole economic system. In 2017, Crypto Valley Association was founded, a nonprofit organization specialized in blockchain. Soon afterwards, the first guideline was launched for ICO, and renewed in 2018.50 The country’s industrial competitiveness remains in the leading position. According to the Global Competitiveness Index 2017–2018 released by the World Economic Forum (WEF), Switzerland has been the most competitive economy for consecutive 9 years. In terms of the number of talents, according to H-index, the most influential of its kind, released by Guide2Research, the country has 32 out of the 1,000 leading computer scientists of the world.51 Favorable ambiance for competition and leading talents are sustainable driving forces for the development of Switzerland’s Internet industry. It is one of the leading countries in per capita Internet application. Consumers there are fond of online shopping, with strong purchasing power, so its e-commerce is moving up. By January 2018, the number of online shoppers accounted for 57%

47

http://www.c114.com.cn/news/126/a1064696.html. Source: ITU, Measuring the Information Society Report 2017.. 49 https://www.huawei.com/cn/about-huawei/publications/winwin-magazine/31/swisscom-quickof-the-blocks-with-5g. 50 https://www.bishijie.com/shendu_3745. 51 http://www.guide2research.com/scientists/. 48

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and the income of the online shopping market was US$ 7.7 billion, with a year-on-year increase of 9%.52 According to the B2C E-commerce Index released by UNCTAD, Switzerland ranks second in the world in that aspect. It has issued Federal Act of Data Protection (FADP) and Implementation Rules of FADP to strictly protect all data stored in the country. Therefore, the business (data computing and storage) of Swiss Data Center is growing explosively. More and more businesses, such as Yahoo! and Samsung, have transferred their servers there to guarantee the security of their data.53 Though it is a small country in cybersecurity facilities, Switzerland provides 32,897 safe network servers54 for every million people, which is on the top of the list throughout the world. In terms of Internet governance, Switzerland has, in accordance with Cyber-crime Convention of the European Council, formulated and implemented a series of new laws and regulations and set up a perfect legal framework based on international conventions to ensure the orderly development of its Internet industry.55 The Cybercrime Coordination Unit Switzerland handles cybercrime. Besides, the country takes the lead in false news countering and financial technology. It plays an important role in international affairs. For instance, it hosted in December 2017 the Twelfth Internet Governance Forum, attracting over 2,000 representatives from political circles, businesses, academic circles, international organizations, and technical communities of the world. All participants discussed how to “shape the digital future”, involving areas such as digital economy, cybersecurity, AI, IoT, and blockchain,56 making a great contribution to the international Internet governance. (IX) Germany has made outstanding achievements in the digital transformation of traditional industries. Germany ranks ninth among the 45 assessed countries. It ranks 11th in infrastructure, 3rd in innovation capacity, 8th in industry development and Internet application, 7th in cybersecurity, and 5th in Internet governance. The German government attaches importance to digitalization, but sees slow progress in infrastructure construction. The coverage rate of fixed broadband there remains 98%. The use rate of high-speed (over 30 Mbps) broadband increased from 26% in 2016 to 36% in 2017. There is a digital gap between urban and rural areas. The use rate of mobile broadband is only 79%, lower than the European average, which is 90%.57 In recent years, Germany has been strengthening its infrastructure construction. In March 2016, it released the National Digitalization Strategy, in which it proposed the establishment of a fund of 10 billion euros to stimulate the investment in super-speed broadband in rural areas. It plans to complete the Gbps 52

Source:Digital Report 2018. http://www.sohu.com/a/133260788_481762. 54 Source: Database of the World Bank. 55 http://media.people.com.cn/n/2012/1226/c40606-20016857.html. 56 http://media.people.com.cn/n1/2018/0125/c14677-29786194.html. 57 Digital Economy and Society Index (DESI) 1 2018 Country Report Germany. 53

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fiber networks by 2025. In July 2017, it released German 5G Strategy, which proposes that complete 5G network coverage will be realized by 2025 to enhance the mobile network supply competence in central cities and township areas, as well as federal expressways, interstate highways, railways, and wide waterways, and thus to make full use of the potential of Gbps mobile networks.58 Germany is good at applying inventions into industries and promoting them into commercial sectors. Therefore, German-style innovations are integrations of new philosophy or function into old products or techniques, or integrations of old-fashioned and backward sectors into thriving new sectors.59 In terms of industry development, the country puts more stress on the digital transformation of traditional manufacturing. Industry 4.0 platforms are thriving there. World-class manufacturers, such as Siemens and Bosch, initiatively promote the development of Industry 4.0 and foster their industrial Internet platforms to contribute to digitalization and intelligent manufacturing of Germany. The country attracts attention in smart city construction, represented by Berlin, the capital city, Frankfurt, and Friedrichshafen. Berlin pays attention to sustainable economic development by fostering itself into a metropolis with energy-efficient housing and electric transportation, Frankfurt is building itself into a green city, and Friedrichshafen stresses services to the public by implementing over 40 smart-city projects covering medical care, education, and other areas. The German government has issued a series of documents guiding cybersecurity construction, including National Strategy on Critical Infrastructure Protection in 2009, Cyber Security Strategy for Germany in 2011, and National Defense White Paper by the army in 2016, which make a comprehensive layout of network defense systems of the country involving critical information infrastructure, national information technology, public administrative information technology, and the national cyberspace response center. Agency for Innovation in Cyber Security was founded in August 2018 to boost cybersecurity research and develop cybersecurity technology. In Internet governance, Germany relies more on trade organizations. The government is enhancing legislation and regulation on social media supervision. In June 2017, it adopted Act to Improve Law Enforcement in Social Networks (Network Law Enforcement Act), which is a comprehensive integration and modification of all relevant laws issued by the German Ministry of Justice since 2015. The Act clarifies the legal definition of social network platforms, channeling into the supervision of laws all social network platforms operated in the country aiming for profits and sharing all information with the public and users, including

58

Zhang Yiyan: Germany releases the 5G Strategy to lead a digital future, Guangming Daily, http://epaper.gmw.cn/gmrb/html/2017-11/08/nw.D110000gmrb_20171108_1-14.htm, 11/08/2018. 59 http://www.istis.sh.cn/list/list.aspx?id=10529.

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Facebook, Twitter, and YouTube. Thus Germany is the first developed country in the West with a complete legal system governing social media.60 (X) Japan enjoys comprehensive Internet development. It is well-known that the mobile Internet in Japan started early and that it has enjoyed a fast development. After years of construction and accumulation, a perfect system has been formed. The country ranks tenth among the 45 assessed countries. It ranks 18th in infrastructure, 6th in innovation capacity, 4th in Internet application, 18th in industry development, 10th in cybersecurity, and 7th in Internet governance. Japan attaches importance to emerging technologies and innovation capacity. Its application for ICT patents only comes after that of the United States. In the Top100 Global Technology Leaders released by Thompson Reuters, the number (13) of Japanese companies is only next to that of US companies. The country is ahead of other countries in R&D investment and patent application.61 Its businesses are investing in AI, IoT, robotics, and hi-tech hardware, putting stress on their technological innovation capacity building. Japan is a little backward in the industry development of the Internet. There are a few giants in search engines, social media, or e-commerce. Little commercial mode innovation is done in the country. In terms of cybersecurity, the country is strengthening its capacity in handling cyberattacks with emerging technologies such as AI, trying to introduce AI into the defense system of the information communication networks of the Japan Self-Defense Force. It is expected to start software development in 2020 and to put it into use in 2022. It is also planning to use AI in the whole governmental network defense system, wishing to analyze the features and rules of cyberattacks through the deep learning capability of AI to combat future cyberattacks.62 Japan’s Internet governance is mainly coordinated by nongovernmental organizations like the Internet Industry Society. The government has issued a series of laws and regulations to bring the Internet under control. Most of the legislation is focused on cybersecurity, cybercrime, and Internet service providers’ behavior. The country has detailed laws and regulations on personal information security, Internet culture, and juveniles’ access to the Internet. IV. Trend of the World’s Internet Development and Suggestions on Relevant Policies Generally, quantity-driven Internet development is shifting to quality-driven development. R&D of emerging technologies such as big data, IoT, AI, and blockchain is witnessing primary achievements, boosting the deepening of the global digitalization. The emergence of new forms of industry, new modes, and 60

Mo Weiwei: New Trends and Enlightenment of Social Network Media Governance in Developed Countries, China Information Security, 2018(2), https://www.secrss.com/articles/1622. 61 Thompson Reuters, https://www.thomsonreuters.com/en/products-services/technology/top-100. html. 62 https://www.guancha.cn/industry-science/2018_01_07_442144.shtml.

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new services has new demands for and poses new challenges to Internet governance rules. Looking into the future, we suggest that all countries should, on the principle of equality and openness, jointly respect cyber sovereignty, promote Internet development, safeguard cybersecurity, participate in Internet governance, and share their Internet development achievements. All of them are expected to contribute to the building of a community of shared futures in a secure and orderly cyberspace with more equality, respect, innovation, openness, and sharing. 1. We should speed up Internet coverage to better benefit all the peoples. The fundamental driving force and foothold of Internet development is the benefit to and well-being of all peoples. There remains a big digital gap across the world in terms of Internet coverage, technology R& D and application, cybersecurity protection, and discourse power of Internet governance. National advantages in traditional areas are being amplified by the Internet. Rapid progressive decrease of the marginal cost of Internet application makes the Internet the best entry point to the common prosperity of the world. The value of Internet platforms lies in universal benefit and sharing. The international community has the responsibility for boosting information infrastructure construction and technology R&D capability cultivation in the least-developed areas and for making the Internet universally beneficial. They should provide support in funds, technologies and talents for developing countries, and discover new approaches to making e-commerce, smart medical care, and online education available in the least-developed areas, so that the Internet development results will better benefit all nations. 2. We should promote the sustaining development of emerging technologies and jointly deal with problems concerning security, ethics, and legal affairs. Sustaining development of emerging technologies causes new problems in governmental administration, economy and society, and ethics. The establishment of relevant ethical frameworks and how to deal with the legal problems occurring in the technical application are a universal concern. The international community has the responsibility for theoretical research, institutional design, and practical innovation concerning security, ethics, and legal affairs resulting from the development of new technologies, such as AI, blockchain, and quantum computing. We should strengthen the strategic cooperation between countries and regions and jointly discover new models and methods to promote development, protect security, and avoid risks, so that technical development can serve all peoples in real sense. 3. We should maintain positive cyberspace to protect the growth of juveniles. The new generation of juveniles are born and brought up in the Internet era, so the cyberspace is becoming their spiritual and cultural home, influencing their studies and lifestyles. Juveniles, not so mature mentally, cannot yet make a value judgement on the objective world, so they are subject to the influence of negative culture and unhealthy ways, which may twist their outlook on the world and values, affect their mental health and even give rise to juvenile crime. Young people represent the

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future of the world, so cyberspace protection for them is a global subject which must be highly stressed and properly handled by the international community. All countries should supervise and guide juveniles’ access to the Internet, teach them to treat the information in cyberspace in a rational way, and thus improve their discriminability, self-control, and self-consciousness. To sum up, we should create favorable cyberspace for juveniles’ healthy growth. 4. We should face and handle together the challenges to cybersecurity to ensure reliable and secure Internet development. All countries should, on the principle of openness and cooperation, enhance coordination in policies and communication in strategies, share advanced technical achievements and experiences in handling cybersecurity incidents, set up the global mechanism for an emergency response to cybersecurity incidents, and strengthen international cooperation in security protection of information infrastructure network. They should open their market wider, support the development of cybersecurity industries, and strengthen talent exchange and cultivation while combating hacking, network fraud and infringement on privacy, and improving Internet users’ knowledge and quality and protective capability concerning cybersecurity, to reinforce the cybersecurity sense of businesses, social organizations, and Internet users. 5. We should respect cyber sovereignty and promote the reform of the global Internet governance system. At present, the global Internet governance is at a critical turning point, so it is an irresistible trend and will of all peoples to reform the global Internet governance system. Different from what it was in 2017, the United States’ apparent anti-globalization tendency and unilateralism have given rise to more uncertainties and challenges. Global Internet governance should be based on multilateral and multiparty participation. Governments, international organizations, Internet businesses, technical communities, private sectors, and individuals should all play their roles in it. We should promote cyber governance within the UN framework and give full play to the role of non-state actors to build a community of shared future in cyberspace. We should work together to make the global cyberspace more peaceful, secure, open, and cooperative.

Chapter 1

Development of World Information Infrastructure

1.1 Overview Information communication infrastructure, the internationally recognized strategic public infrastructure, plays a key role in facilitating digital society construction and digital economy development. With the acceleration of IT development, network infrastructure tends to witness a high speed, total coverage, and intelligence. All countries are deploying the new-generation network infrastructure to occupy a commanding height in the international economic and technical competition of the information era. The world is in an age of IoT. Construction of intelligent application infrastructure represented by data centers, cloud computing platforms, Content Delivery Network (CDN), IoT sensing devices, and Internet exchange centers is not only the business of traditional telecommunication operators, but also that of Internet companies. 5G technology has seen its first-phase full-function standardization. The whole industry is in a sprint period, with all countries constructing 5G testing and trial commercial networks, contributing to the booming upgrade and construction of 5G networks. 1. Fiber broadband Fiber broadband is the mainstream form of fixed broadband, with the number of its users increasing steadily. With the popularization of MB broadband across the world, the gigabit network is the new goal, for which all countries are making and implementing their gigabit broadband action plans. According to data from Point Topic, by the first quarter of 2018, the number of fiber broadband users had amounted to 555 million, accounting for 59.5%, with 415 FTTH users among them. China, Japan, and Republic of Korea (ROK) are all pioneers in fiber broadband network development, having replaced the copper cable with the fiber. 2. Mobile broadband The number of 4G networks and users across the world is increasing steadily. According to GSA statistics, by the end of June 2018, 208 countries and regions © Springer Nature Singapore Pte Ltd. 2020 World Internet Development Report 2018, https://doi.org/10.1007/978-981-15-4067-7_1

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had opened 681 LTE (4G) commercial networks. GSMA Intelligence statistics show that by the same time, the number of mobile users of the world had reached 7,840 million, with a popularization rate of 102.7% and a 4G penetration rate of 38%. All major countries attach great importance to the development of 5G technology, having launched their national strategies for 5G commercial use around 2020. China, ROK, Japan, the United States, and EU have published their 5G frequency spectrum plans and they are deploying and testing their networks for the trial commercial use of that technology. 3. Next-generation Internet Large-scale IPv6 commercial deployment is being done rapidly across the world. APNIC statistics show that by the end of August 2018, the IPv6 deployment rate of the world had amounted to 16.78%, that of North America, Asia, Europe, Oceania, and South America amounting to 29.53%, 15.38%, 14.86%, 14.14%, and 0.83%, respectively. The global IPv6 traffic grows at a high speed, that of 24 countries exceeding 15%, and especially that of Belgium and the United States both exceeding 50%. The average IPv6 deployment rate of the top ten operators across the world is over 60%. The mobile network is the key driver of IPv6 deployment. The IPv6 support rate of the top 50 websites of the world is as high as 60%. 4. International communication infrastructure International communication infrastructure is being connected at a high speed, and international Internet broadband export keeps growing rapidly, with the United States and Europe as the major destinations of cross-country data flow. The submarine optical cable system construction is witnessing the replacement of the old with the new; its market is expanding quickly; and its construction and financing pattern keep on being innovated. Giant Internet businesses are major investors of submarine optical cable investment. International organizations, governments, and businesses are cooperating with each other in advancing the interconnection of cross-border land optical cables, the seamless connection of international communication networks, and the closing of the digital divide caused by imbalanced development of different regions. 5. Space-based Internet In 2018, the world’s space-based Internet witnessed leapfrog development. There are 26 satellite operators who have launched 59 geostationary orbit satellites of high flux. Some of them have deployed satellite Internet close to the ground, with plans of 15 low and medium orbit satellite constellations being released. O3b is the world’s only company with an officially on-orbit satellite constellation. Telesat and SpaceX are carrying out on-orbit tests. Floating-platform communication technology is developing fast, playing a role in universal access to the Internet and in emergency communication.

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6. Universal telecommunication service All countries are taking advantage of universal telecommunication services to improve the rate of broadband network coverage and access in rural and remote areas, and hence to narrow the digital gap between urban and rural areas and improve public service and popularization of the Internet in rural areas. The universal telecommunication service implementation mechanism is being improved. All governments take funds in that respect as the leading fund, and guide businesses in enhancing broadband construction in rural areas. Large Internet businesses are innovating technology of Internet access to rural areas, providing low-cost, flexible, and convenient service for those areas. 7. Data centers and cloud computing platforms By the end of 2017, there were over 390 large data centers in 24 global cloud platform and Internet businesses, with the most super data centers in the United States, accounting for 44% of the world’s total; and the number of those centers in China, Japan and the United Kingdom accounting for 8%, 6%, and 6%, respectively. EU members, Russia, Australia and ROK have formulated data protection policies, and are implementing data localization management and constructing more localized data centers. Driven by demand, commercial data centers and cloud computing facilities are laid out around central cities of key areas. The world’s leading third-party data center service providers like Equinix and Digital Realty Trust are setting up their data centers in developed cities across the world. 8. Basic Internet resources By the end of August 2018, the number of total allocated IPv6 addresses had reached 242, 344 blocks (/32), that of the United States ranking first, and that of China and Germany, second and third, respectively. The IPv6 use rate remains low, the advertising rate of only 10 countries over one percent. All countries have applied for 87, 358 Autonomous System (AS) numbers, with a rate of over seven percent, that of the United States ranking first. The number of domain names keeps increasing. By the end of March 2018, there were over 343 million of them. The number of TLDs is increasing, with that of the top 10 accounting for 73.2% of the global total. In particular, .com, a TLD, sees its number increasing steadily, with its market volume amounting to nearly 40% of the world’s total.

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1.2 Broadband Network 1.2.1 Increasing Percentage of Fiber Broadband, with Its Accessibility Toward Gigabits 1. Increasing number of fixed broadband users According to a report from Point Topic, by the first quarter of 2018, the number of fixed broadband users of the world had been increasing steadily, with the number of fixed broadband accesses amounting to 952.5 million, up by 9% on a year-on-year basis, and the popularization rate to 15.6%, as is shown in Fig. 1.1. East Asia is the area with the largest fixed broadband market, and 64% of the increase of the number of fixed broadband users comes from that region. The increase in other regions is slowing down. 2. Increasing percentage of fiber broadband users With the percentage of the users across the world (see Fig. 1.2), fiber broadband is a new direction of fixed broadband, which is witnessing the copper cable access technology represented by ADSL and CATV broadband technology represented by Cable to fiber access technology represented by FTTH. By the first quarter of 2018, there were 555 million fiber broadband users, accounting for 59.5%, including 415 million FTTH users and 140 FTTX users. The copper cable access has been decreasing, down by 7% on a year-on-year basis, while the FTTH/B/C access rates have been increasing, up by 28% on a year-on-year basis. Approximately 78% of the global fixed broadband users have adopted FTTH/B/C and CATV access.

Fig. 1.1 Number of fixed broadband users and its growth rate (Source Point Topic)

1.2 Broadband Network

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Fig. 1.2 Percentage of sub-technology fixed broadband users in different continents (Source Point Topic)

China has completed the replacement of copper cable networks with fiber networks, with the number of the users of the latter accounting for 87.5%, higher than that of OECD countries like Japan, ROK, and the United States. In fact, Japan and ROK began their fiber broadband network construction earlier than other OECD countries, and the number of their fiber broadband users is higher, accounting for 76.8% and 76.7%, respectively. The United States has a higher percentage of Cable technology. The early-stage development of the United Kingdom and Germany was focused on the high-speed copper cable access technology. Today the number of their fiber broadband users is behind some OECD countries. Russia has seen a rapid development of fiber broadband, with the number of its FTTH users accounting for 62.3%. 3. Access capacity toward Gbps With the popularization of MB broadband throughout the world, the Gbps network is becoming a new goal of development. All countries are making and implementing new lines and action plans, offering policy and resource support, and enhancing the cooperation between the government and businesses. So far, over 400 Gbps networks have been completed and over 100 operators have launched their Gbps plans. According to the 13th Five-Year Plan, by 2020, China will provide 1,000 Mb/s access capacity. Three operators, namely, China Telecom, China Mobile, and China Unicom, have launched since 2016 their One Hundred Cities’ Gbps Construction Plans, and they are facilitating the construction of Gbps Pilot Communities. By 2018, Shanghai had become the World’s First Gbps City, with the full coverage of Gbps broadband networks. BMVI has launched Zukunftsoffensive Gigabit-Deutschland, according to which by 2025, Germany will have invested 100 billion euros in the

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construction of high-performance broadband networks throughout the country, and built Gbps infrastructure to ensure Internet of Everything and Industry 4.0 and to turn the country into a Gbps society. Besides, some operators from developed countries, such as Singapore Telecom, Hong Kong Telecom of China, and So-net of Japan, have opened 10 Gp/s broadband for high broadband businesses like 8K videos and VR games.

1.2.2 Increasing Number of 4G Users and 5G Technology on Its Fast Track 1. Increasing number of global 4G networks and their users According to GSA statistics, by the end of June 2018, there were 681 LTE (4G) commercial networks in 208 countries and regions, with 114 TD-LTE networks in 60 countries. According to GSMA Intelligence, by the same period, there were 7,840 million mobile network users in the world, with the mobile network popularization rate amounting to 102.7% (see Fig. 1.3), up by 8% in comparison with that of 2017. On the other hand, the rate varies among different regions, with Europe far ahead of other regions and Africa far behind. The fast deployment of 4G networks has promoted the change of mobile network user structure. By the end of June 2018, the number of global 4G users had reached 38%, higher than that of 2G users, as is shown in Fig. 1.4. 2. All countries’ acceleration of development of 5G technology, which is seeing the beginning of its commercial use 3rd Generation Partnership Project (3GPP) has approved 5G networking standard freezing. By June 2018, R15, the first version of 5G, was completed, which

Fig. 1.3 Global mobile users by region (by the end of June 2018) (Source GSMA Intelligence)

1.2 Broadband Network

7

Fig. 1.4 Change of percentage of global 2G/3G/4G users (Source GSMA Intelligence)

symbolized the completion of the first-stage full-function standardization. It supports enhanced mobile broadband and basic low-delay high-reliability business, so it is capable of constructing a totally new end-to-end business. Meanwhile, 3GPP has contributed to the pre-research of R16, the second-stage 5G standard version, which can enhance basic mobile broadband and networking capacities, and support vertical application. Major countries and regions support the development of 5G technology, planning to put it into commercial use around the year 2020. China, EU, ROK, Japan, and North America attach importance to the technology, having launched their plans and increasing input in the R&D and application of the technology. EU has established the Mobile and Wireless Communications Enablers for the 2020 Information Society and the 5G Public-Private Partnership (PPP) and other big projects, with the total R&D expenditure amounting to 4.2 billion euros. They have also launched the 5G action plans and 5G spectrum strategies. The United States has listed 5G technology as the priority mission for national security. According to National Cyber Strategy of the United States issued in September 2018, the US government will cooperate with private sectors in promoting 5G development and security. Japan has launched 5G technology testing and spectrum planning. It will put 5G into commercial use by the Olympics in Tokyo in 2020. ROK finished the 5G commercial use test during the Olympics of Pyeongchang. The spectrum planning across the world is focused on 3.4–3.8, 26, 28, and 39 GHz frequency bands.

8

1 Development of World Information Infrastructure

1.2.3 Advancing IPv6 Commercial Deployment and Healthy Development of Its Industrial Ecosystem 1. Rapid growth of IPv6 thanks to the promotion of all countries According to statistics from APNIC, by the end of August 2018, the IPv6 deployment rate of the world had reached 16.78%, with that of North America, Asia, Europe, Oceania, and South America amounting to 29.53%, 15.38%, 14.86%, 14.14%, and 0.83%, respectively. From June 2012 to August 2018, the global IPv6 traffic grew by over 5,000%. IPv6 traffic of 49 countries accounts for over 5%, and that of 24 countries for 15% (see Fig. 1.5). That of Belgium and the United States account for over 50%, respectively. 2. Steadily increasing IPv6 deployment rate thanks to the effort of large telecommunication operators Over 300 operators in the world provide IPv6 commercial use access. The average IPv6 deployment rate of the top 10 operators of the world is over 60% (see Fig. 1.6), with that of American T-Mobile and Verizon Wireless, British Sky Broadcasting and Indian Reliance Jio exceeding 80%, respectively. 3. Support from software and hardware manufacturers meeting the demand for commercial deployment According to the Global IPv6 Testing Center, by the end of October 2017, 75% of operating systems are installed with IPv6 protocol stack, 65% support DHCPv6, and 50% support ND RNDSS. Mainstream products of APP and servers like email

Fig. 1.5 Countries (marked in gray) with IPv6 deployment rate exceeding 15% (Source State of IPv6 Deployment 2018)

1.2 Broadband Network

9

Fig. 1.6 IPv6 deployment rate of the world’s top 10 operators (Source State of IPv6 Deployment 2018)

service, file transmission, browsers, multimedia players, instant messaging, program development, and databases all support IPv6. Mainstream manufacturers of network equipment have developed a large quantity of IPv6 products, covering almost all network products (including routers, interchangers, access servers, firewalls, VPN gateways, and domain name servers), which can meet the demand for commercial use of IPv6. 4. Dramatic increase of business application support capability and the launch of IPv6-only by large businesses In August 2018, among Alex’s top 1,000 websites, 25% supported IPv6. Among the top 50, 60% support IPv6. Facebook, Google, Twitter, and YouTube all support IPv6. Facebook shifted all its internal network to IPv6 in 2014, and its data center has IPv6only, with all its internal hosts being able to respond to IPv6 requests. Its internal IPv6 traffic has amounted to 90%, and the external traffic to 50%. Apple requires that all APPs submitted to App Store should conform to IPv6-only standard.

1.2.4 Interconnection of Network Facilities 1. Steady fast growth of the world Internet broadband The fast flow of data across the world has promoted the fast growth of the world Internet broadband, which saw in 2018 a year-on-year increase of 35%, and its total speed of 393 Tb/s. One of the facilitators was the inter-national broadband growth rate within Europe, which saw an increase from 22% in 2017 to 36% in 2018, as is shown in Fig. 1.7.

10

1 Development of World Information Infrastructure

Fig. 1.7 Growth of internet broadband (2014–2018) (Source: Telegeography)

As for inter-regional Internet broadband, the inter-continental line with the largest capacity in 2018 was that between Latin America and North America, with the speed reaching 37 Tb/s. Then came the lines between Asia and North America and between Europe and North America, the speed of both reaching 21 Tb/s. North America remains the major destination of the world Internet broadband connection. Africa sees the fastest inter-continental Internet broadband growth, with an annual growth rate of 45%. Then come Asia and the Middle East, with the annual growth rate of 41%, as is shown in Fig. 1.8. 2. Continuous expansion of global submarine cable construction From 2017 to 2018, the West Pacific, trans-Pacific, and Asia-Africa cable constructions are hotspots. JUPITER, SEA-US, and Africa-1 have been launched into production, and SJC2 and other cables have seen the beginning of their operation (see Table 1.1). Besides club and private productions, there are more schemes, such as Turnkey and OpenCable, with more flexible cooperation and multiple rights and interests allocation by capacity and by fiber core. Telecommunication operators are not the only investors in submarine cable construction, but Internet giants like Google, Microsoft, and Facebook are new investors in it. 3. Multilateral coordination in promoting the interconnection of cross-border land cables International organizations are active in promoting the interconnection of crossborder land cables. The UN ESCAP Information and Communication Committee has proposed the construction of AS-IS, which will connect the core trunk network/Internet interchange points from Asian and Pacific countries to form a physical network made up of cross-border land cable connections and submarine landing stations.

1.2 Broadband Network

11

Fig. 1.8 Inter-regional internet broadband in 2018 (Source: Telegeography)

Governments cooperate with businesses in promoting cross-border information highway construction. The Azerbaijan Government proposed in 2008 the TASIM project, which is constructed and operated by operators from Azerbaijan, China, Kazakhstan, and Turkey, to construct a new cable transmission line between Europe and Asia and hence to improve the connectivity between the two continents. Recently, the third-party feasibility study has been started. China Telecom, in line with the Digital Silk Road Initiative, has proposed a multilateral land cable construction project, in which Middle Asia, South Asia, and West Asia will be connected. It is an innovation of the land cable cooperation mode. Through the capacity bank mechanism, the operator is constructing with its partners new-type land cable systems crossing multiple countries to promote the interconnection construction along the line and provide direct-access-to-the-sea network channels of submarine cable landing stations.

1.2.5 Fast Developing Space-Based Internet, Which Has Been Laid Out by All Countries 1. Rapid development of global high-orbit and high-throughput satellites With technical development and increasing demand for application scenarios, global high-orbit and high-throughput satellites saw rapid development in 2018. The capacity of single high-throughput satellites represented by Viasat-3 will reach 1 Tb/s.

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1 Development of World Information Infrastructure

Table 1.1 Key submarine cable systems launched into operation or production (2017–2018) Number

Submarine cable name

Connected countries and regions or direction

Time of launching into operation or construction

1

SJC2

Singapore, Thailand, Vietnam, Hong Kong and Mainland of China, ROK, and Japan

By Q4 of 2020

2

ASC

Singapore, Indonesia, and Australia

Launched into operation by July 2018

3

JUPITER

Japan, the Philippines, and the United States

Launched into operation by July 2018

4

HKA

Hong Kong of China and the United States

Constructed by the end of 2018

5

SEA-US

Asia and the United States

Launched into commercial use In August 2017

6

Hawaiki

Australia, New Zealand, and the United States

Launched into operation in June 2018

7

AAE-1

Southeast Asia, Africa, and Launched into operation in Europe June 2017

8

Africa-1

Africa and the Middle East Launched into operation in and South Asia Q3 of 2017

9

PEACE

Pakistan, Djibouti, Egypt, Kenya, and South Africa

Launched into operation in Q3 of 2019

10

SAIL

Across the South Atlantic, connecting Africa and South America

Completed in September 2018

11

EllaLink

Europe and Latin America

Started in 2018 and launched into production in 2020

12

Dunant

East Coast of the United States and Europe

Started in 2018 and launched into production in 2020

Three new global high-orbit and high-throughput satellites were launched in the first half of 2018 and 10 more will be launched in the second half of the year. 2. Low- and medium-orbit satellite constellations to be launched By March 2018, the world has published 15 constellation plans, including 6 from the United States, 4 from China, and 1 respectively from Russia, Canada, ROK, India, and the Netherlands. O3b is the world’s only company with the official on-the-orbit satellite constellations. By the end of June 2018, it had launched 16 on-the-orbit satellites, with the capacity of single satellite communication amounting to 19 Gb/s. It plans to launch 7 more high-performance second-generation telecommunication satellites from 2021. On January 12, 2018, Telesat succeeded in launching LEO Vantage 1, its first experimental telecommunication satellite. It is carrying out the on-the-orbit tests.

1.2 Broadband Network

13

Fig. 1.9 Number of GLOBAL GEO-HTS satellites launched (2004–2020) (Source Northern Sky Research)

On February 22, 2018, SpaceX succeeded in launching two experimental telecommunication satellites named Tintin A/B, providing early-stage on-the-orbit technical identification for Starlink constellation. The number of global GEO-HTS satellites launched from 2004 to 2020 is shown in Fig. 1.9. 3. Steady development of floating-platform telecommunication technology Floating-platform telecommunication technology has facilitated universal connection with the Internet. Big Internet businesses are trying to provide users in remote areas with access to the Internet through floating platforms and wireless technology. Facebook has carried out the plan to provide universal access to the Internet by using drones powered by solar energy. Kenya announced in 2018 that it would provide Internet access to its remote areas with the hot-air balloon system. Floating-platform telecommunication technology is an effective means of emergency communication. Europe, the United States, and Japan are studying and testing floating-platform telecommunication systems like drones and hot-air balloons to meet the demand for emergency communication, for instance, in disaster relief and salvation. In 2017, the hot-air balloon floating-platform telecommunication system contributed to emergency network communication in Puerto Rico and the Virgin Islands stricken by a hurricane, and in Peru stricken by floods.

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1 Development of World Information Infrastructure

1.2.6 Innovative Universal Telecommunication Service Facilitating Network Construction and Application in Rural Areas 1. Mobile broadband network, a major form of universal telecommunication With the rapid development of mobile telecommunication technology and smart terminals, an increasing number of countries are taking mobile broadband as a major form of universal telecommunication. They are building more mobile base stations in rural areas and expanding 4G service. Vodafone has carried out 4G network construction in rural areas of Germany, benefiting 350,000 citizens. It is planning to enable 98% of the German population to have access to 4G networks. Indonesia, New Zealand, Zimbabwe, and Gabon are accelerating the construction of mobile broadband networks in rural areas to provide Internet access to local residents, schools, and community centers. 2. Universal telecommunication service facilitating public service in rural areas All countries are providing information applications for residents, businesses, schools, hospitals, and public administration organizations in rural areas. The US Federal Communication Commission (FCC) will increase funds for distant medical care projects in rural areas to help medical institutions there to have access to broadband Internet and to provide basic facilities for distant medical care and monitoring projects. China is implementing the action plan for poverty reduction through the Internet, involving network facilities, mobile terminals, information content, ecommerce platforms, and public service, so that through the Internet, agricultural products can be sold outside rural areas, children there can have access to quality education and more poor people can obtain quality public service.

1.3 Application Facilities 1.3.1 Intensification and Globalization of Data Centers and Cloud Computing Platforms Data centers and cloud computing platforms tend to be intensified, green, and safe. They are being laid out across the world. Traditional data center service providers, Internet businesses, and cloud service providers all accelerate their resource deployment and there is an increasing number of big data centers. Meanwhile, because of data protection policies, more localized data centers are being founded.

1.3 Application Facilities

15

Fig. 1.10 Distribution of large data centers of 24 internet businesses (December 2017) (Source Synergy Research Group)

1. Obvious advantages of big data center resources in the United States According to a survey by Synergy Research Group in 2017, the number of super-large data centers of the United States accounts for 44% of the global total (see Fig. 1.10), ranking first in the world, though a little lower than 45% in 2016. The total number of super-large data centers of China, Japan, and the United Kingdom accounts for 20%, while that of super-large data centers in Australia, Germany, Singapore, Canada, India, Brazil, Ireland, the Netherlands, and Hong Kong of China accounts for 3–5%. A large number of big data centers have emerged in Germany, the United Kingdom, Singapore, and Australia, a little higher than the number in 2016. 2. Data protection policies contributing to the building of localized data centers Many countries have launched data protection policies requiring data retention to be localized, which facilitates the building of localized data centers and cloud platforms. EU Data Retention Directive and General Data Protection Regulation (GDPR) provide general forbidding regulations as follows: Unless the destination country can provide the protection of the same degree as in EU, no personal data shall be transmitted to the third county. Russia has launched Personal Data Protection Law, providing that any Russian or foreign company collecting Russian citizens’ personal data shall use servers within Russia when dealing with any data concerning personal information, including data collection, accumulation, and storage. Australia, Vietnam, ROK, Canada, and Israel have all formulated similar regulations and laws concerning data, which contributed to the increase in the number of local data centers established by Internet businesses.

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1 Development of World Information Infrastructure

3. Commercial data centers and cloud computing facilities deployed around central cities Cloud service providers with leading technology locate themselves around key markets. According to a survey by Synergy Research Group, by the end of 2017, 24 leading businesses in cloud computing and Internet service had totally over 390 large data centers. Amazon, Microsoft, IBM, and Google have over 45, respectively, distributed in North America, Asia and the Pacific, and EMEA (Europe, the Middle East, and Africa). Apple, Twitter, Facebook, eBay, and LinkedIn have more data centers in the United States. The distribution of data centers of Amazon and IBM across the world is shown in Table 1.2. Third-party data center blog service providers like Equinix and Digital Realty Trust are accelerating their data center deployment in developed cities of the world. Equinix has 196 data centers across the world, mostly in central cities of the Americas, the Asia-Pacific Region, and EMEA regions. Data centers of Digital Realty Trust in the United States are in coastal cities and central inland cities; and those in Europe and the Asia-Pacific Region are in large developed cities. Table 1.2 Distribution of data centers of Amazon and IBM across the world Amazon AWS Cloud (1) Amazon AWS Cloud operates 55 available zones in 18 geographical areas and one local area. Every available zone is made up of one or more data centers, which are distributed in central cities, covering all key markets of the world. In comparison with the year 2016, the year 2017 saw the establishment of 11 new zones of Amazon in the world (2) In the Asia-Pacific Region, Amazon data centers are distributed in Mumbai, Sidney, Tokyo, and Osaka; in America and Europe, they are distributed in developed cities along the US coast and central cities like Frankfurt, London, Paris, and Sao Paulo (3) Recently, Amazon has announced that it will open four new AWS GovCloud zones, in Bahrain, Hong Kong of China, Sweden, and the United States, as well as 12 new available zones IBM BlueMix

(1) IBM cloud data centers are distributed all over the world, totally 60 in number, 5 more than those in 2016. They are mostly in central cities with leading comprehensive economic strength, distributed in 19 countries of the Americas, Europe, Oceania, Asia, and Africa (2) Among all IBM cloud data centers, 33 have public cloud business. The public cloud centers are in four continents, namely North America, Asia, Europe, and Oceania. They are in large developed cities of the United States, the United Kingdom, Australia, China, Germany, and Sweden, for instance, Los Angeles, Washington, London, Frankfurt, Tokyo, Hong Kong SAR of China, Sidney, and Beijing

1.3 Application Facilities

17

1.3.2 Rapidly Developing CDN Industry and Integration of New Technologies into CDN 1. Expanding global market of CDN and cloud computing businesses breaking the pattern According to Markets and Markets, the market volume of CDN across the world reached USD 7.47 billion in 2017, with a compound growth rate of over 32.8% in the past 5 years. It is estimated that it will reach USD 30.89 billion in 2022. Meanwhile, cloud computing businesses, relying on their own storage and computing technologies, are expanding their CDN business. Data from Datanyze shows that the market volume of Amazon CloudFront accounts for 30% of the global total (see Fig. 1.11), higher than that of Akamai, a traditional CDN business. 2. CDN’s efficient bearing of global traffic and integration with new technologies With the rapid development of the video industry, online video content is being enriched, including 3D, 4K/8K, and VR. The traffic borne by the Internet is seeing explosive growth and CDN’s traffic distribution capacity is increasing. According to Cisco, CDN undertook 52% of Internet traffic in 2016, and it will reach 71% in 2021. With the emergence of cloud computing, HTTP/2 protocols, and SDN/NFV, CDN is being integrated with new technologies of computing, storage, and content deployment. It contributes to the increase of resource utilization ratio when complementary with cloud computing, the increase of network efficiency and service capacity by supporting HTTP/2 protocols, and the increase of network resource management efficiency and flexible service capacity through SDN/NFV technology.

Fig. 1.11 Market volume of CDN across the world (Source: Datanyze 2018–08)

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1 Development of World Information Infrastructure

1.3.3 Steady Development of NB-IoT and EMTC and Increasing Popularization of IoT 1. Diverse LPWAN technologies LPWAN technologies are highlights of IoT development. They vary from country to country. LPWAN technologies like NB-IoT, eMTC, LoRa, RPMA, and Sigfox are rapidly developing worldwide, the first three developing the fastest, with more market advantages. Multiple LPWAN technologies coexist in the world, with no unified technology yet. 2. Steady development of NB-IoT and eMTC A number of telecommunication operators in the world keep up with the development of NB-IoT and eMTC, attempting for technical identification, testing, and deployment upon the completion of standard protocols. According to statistics of GSA, by the end of July 2018, 117 operators from 58 countries/regions had invested in NBIoT, with 60 from 38 countries/regions operators having put NB-IoT into commercial use; and 44 operators from 28 countries/regions had invested in eMTC, with 18 operators from 13 countries/regions having launched eMTC into commercial use. By the end of March 2018, the world had launched 50 NB-IoT modules, 39 eMTC modules, and 26 NB-IoT/eMTC double modules.

1.3.4 Expanding Internet Exchange Centers and Rapidly Rising Cloud Interconnection 1. The Asia-Pacific Region taking the lead in global Internet exchange center expansion Internet exchange centers as key internetwork facilities are developing rapidly in the world, where there are totally 538 such centers in 153 countries, up by 8.0% since last year.1 The Asia-Pacific Region has witnessed the fastest development of the centers, with 107 of them (with a year-on-year increase of 13.8%), more than those in North America for the first time, as is shown in Fig. 1.12. 2. Remarkable convergence effect of super-large Internet exchange centers Super-large Internet exchange centers have attracted a large quantity of networks’ access. There are six large such centers attracting over 500 networks (see Fig. 1.13) each. For instance, 1,467 networks have access to the Brazilian PTT Metro-São Paulo Exchange Center, the highest number in the world. There are nine large exchange centers with the global peak traffic value exceeding Tb/s (see Fig. 1.14). In 2018, 1 PCH

statistics in September 2018.

1.3 Application Facilities

Fig. 1.12 Number of internet exchange centers by region across the world

Fig. 1.13 Number of networks accessing large exchange centers of the world

Fig. 1.14 Peak traffic of large exchange centers in the world (Unit: Tb/s)

19

20

1 Development of World Information Infrastructure

JPNAP Tokyo I-Otemachi and HKIX, two exchange centers in the Asia-Pacific Region, have seen their peak traffic value exceeding Tb/s for the first time. 3. Integrated development of Internet exchange centers and cloud service Businesses adopt mostly the multi-cloud strategy. According to the RightScale cloud computing survey report in 2017, over 67% of businesses in the world have adopted a mixed cloud architecture, and 20% of those accessing cloud have access to multiple public clouds, each connected to 1.8 public clouds on average. To meet the demand of businesses’ connection into multiple clouds, the global intercloud connection architecture is on its fast track, and exchange center cloud interconnection is growing fast. More and more Internet exchange centers have initiated their cooperation with cloud service providers to provide multi-cloud interconnection for their clients. For instance, Megaport is one of the earliest exchange centers providing cloud interconnection solutions in the world, providing multiple major public cloud access services in 57 regions, covering Alibaba Cloud, AWS, Azure, Google Cloud, and IBM Cloud.

1.3.5 Uneven Distribution of Basic Internet Resources and Uneven National Networking Capacity 1. Completion of IPv4 address allocation and Internet giants’ acceleration of IP address storage IPv4 addresses of the world had all been allocated by 2011, totally about 3.664 billion, with 78% of advertising rate this year, almost the same as that of 2017. There are 1.606 billion IPv4 addresses in the United States, accounting for 43.81% of the world’s total of allocated ones and ranking first in the world. China and Japan rank, respectively, second and third in the number of IPv4 addresses. To ensure their development, Internet giants are accelerating their storage of IPv4 addresses. For instance, in the first quarter of 2018, Amazon had 16 million new IPv4 addresses and Alibaba Could had five million new ones. 2. The United States taking the lead in IPv6 address allocation By the end of August 2018, approximately 242, 344 blocks (/32) of IPv6 addresses had been allocated, up by 11.02% on a year-on-year basis. The United States has 45, 273 blocks (/32) of IPv6 addresses, accounting for 18.68% of the allocated ones, then come China and Germany. The used rate of allocated IPv6 addresses remains low, with the advertising rate of only 10 countries reaching over one percent. The United States has the highest rate, which is 28.58%, then come Germany and Japan, which is shown in Fig. 1.15.

1.3 Application Facilities

21

Fig. 1.15 Top 10 countries in terms of the number of allocated IPv6 addresses and their advertising rate (Source: resources.potaroo.net)

3. Steady growth of global domain name resources and increase of concentration of TLD By the end of March 2018, there were 343 million domain names in the world, up by 0.7% on a year-on-year basis. Top ten TLDs are four traditional gTLDs, namely, “.com”, “.net”, “.org” and “.info”, and six ccTLDs, namely, “.cn”, “.tk”, “.de”, “.uk”, “.ru”, and “.nl”. All of them account for 73.2% of the total registered domain names in the world, up by 1.9% on a year-on-year basis. Among them, .com, the global largest TLD and the benchmark of all traditional gTLDs, has seen the fastest growth, with its number at 137 million, up by 3.8% on a year-on-year basis, almost close to nearly 40% of the world’s total registered domain names. Top ten registered TLDs and their market volume are shown in Fig. 1.16.

Fig. 1.16 Top ten registered TLDs and their market volume (Source ICANN, VeriSign and CNNIC)

Chapter 2

World Network Information Technology Development

2.1 Overview The year 2018 has witnessed the steady development of the world network information technology, with new technical innovations and breakthroughs, which have led to a new round of technical upgrades in the economy and society. Information technology tends to develop from digitalization and networking to intelligence, network information technology is being integrated with real economy. In general, the development has the following features: (1) Network information technology is experiencing a new revolution. Some of its areas are developing to its theoretical or physical extremity. Technologies like AI and quantum computing are being integrated into other network information technologies, which contributes to the upgrade of network information technology and its development to a higher level with more segmented areas and a wider scope. (2) Governments of all countries attach importance to the revolution of network information technology. They have formulated, launched, or improved their national strategic plans to take network information technology as one of the drives for their economic development, with an attempt to maintain or form their advantages in the new round of global competition or even to succeed in corner overtaking. In technical competitions, businesses, large Internet businesses, in particular, are the major bodies of innovation. (3) AI, blockchain, and quantum computing are becoming the hotspots of innovation, which facilitate the full-chain revolution of network information technology. The integration of technologies is the trend of development. In 2018, network information technology represented by AI, blockchain, and quantum computing witnessed new applications and new modes, which have contributed to the improvement of production efficiency and social welfare. (4) Global labor division and coordination in terms of network information technology are becoming the trend. With the deepening of trade and economic relations among countries, there are an increasing number of cross-national cooperations © Springer Nature Singapore Pte Ltd. 2020 World Internet Development Report 2018, https://doi.org/10.1007/978-981-15-4067-7_2

23

24

2 World Network Information Technology Development

and technical property right flows, which has led to more benefits than cost. The year 2018 has seen more effects of the coordination.

2.2 Steady Innovative Development of Network Information Technology 2.2.1 Continuous Breakthroughs of Advanced Computing Technology in Computing Capacity Limit 1. Cloud computing supporting the development of AT and big data In 2018, a notable change in advanced computing technology is that AI, big data, and cloud computing have become closer to each other, having formed a trinity or a gold triangle, and promoted one another though independent. The three technologies have formed different AI technologies and application systems based on big data processing. The development and application of big data is inseparable from the support of cloud computing, and the development of cloud computing and big data is the foundation for and the key to the rapid development and substantial breakthrough of AI. The progress of big data and AI will help to deepen and expand cloud computing applications. With the development of the container technology such as Docker and Kubernetes and the formation of technical concepts like micro-service, basic platforms of big data and AI have begun to construct underlying resource management and dispatch platforms based on container cloud, which packs, manages, and dispatches all hardware resources in clusters, taking the packed resources as the components for container-borne big data and programming the containers to form basic services of big data and AI, such as HDFS, NoSQL Hbase, Inceptor(a distributed analysis database), Slipstream (a distributed stream processing platform), and Sophon(a distributed machine learning component). 2. Increasinlgy fierce international competition of high-performance computing In 2018, American CORAL Program has seen great progress. It was funded by the U.S. Department of Energy, which invested USD 525 million in establishing three next-generation supercomputers, namely, Sierra, Summit, and Aurora systems. In June 2018, International Organization for Supercomputers published the list of Top 500 Supercomputers of the world (See Table 2.1).1 Summit ranked first in the list, with its floating-point arithmetic speed at 12.23 GFLOP/s, and peak value close to 18.77 GFLOP/s; the second was China’s Sunway TaihuLight supercomputer, whose floating-point arithmetic speed was 9.3 GFLOP/s. The third, fourth, and fifth were, 1 https://www.top500.org/lists/2018/06/.

2.2 Steady Innovative Development of Network Information …

25

Table 2.1 Top ten supercomputers of the world by June 2018 Ranking

Institution (country)

System

Processors

TFlop/s

Peak TFlop/s

Power (kW)

1

Oak Ridge National Laboratory (the U.S.)

Summit

2,282,544

122,300.00

187,659.30

8,806

2

National Supercomputing Wuxi Center (China)

Sunway TaihuLight

10,649,600

93,014.60

125,435.90

15,371

3

O. Lawrence Berkeley National Laboratory (the U.S.)

Sierra

1,572,480

7,610.00

119,193.60

–

4

National Supercomputing Guangzhou Center (China)

Tianhe-2

4,981,760

61,444.50

100,678.70

18,482

5

National Institute of Advanced Industrial Science and Technology (Japan)

ABCI

391,680

19,880.00

32,576.60

1,649

6

Swiss National Supercomputing Center (Switzerland)

Piz Daint

361,760

19,590.00

25,326.30

2,272

7

Oak Ridge National Laboratory (the U.S.)

Titan

560,640

17,590.00

27,112.50

8,209

8

O. Lawrence Berkeley National Laboratory (the U.S.)

Sequoia

1,572,864

17,173.20

20,132.70

7,890

9

Los Alamos National Laboratory and Sandia National Labs (the U.S.)

Trinity

979,968

14,137.30

43,902.60

3,844

(continued)

26

2 World Network Information Technology Development

Table 2.1 (continued) Ranking

Institution (country)

System

Processors

TFlop/s

Peak TFlop/s

Power (kW)

10

National Energy Research Scientific Computing Center (the U.S.)

Cori

622,336

14,014.70

27,880.70

3,939

respectively, American Sierra, China’s Tianhe-2, and Japan’s AI Bridging Cloud Infrastructure (ABCI). China had more and more supercomputers listed into Top 500, from 202 in November 2017 to 206 in 2018, while the United States saw a decrease from 144 to 124. Different countries are deploying their exascale computing program, including Fast Forward 2 of the United States, EIC of Germany, EU Mont-Blanc of Spain, SEQUANA of France, and Horizon 2020 of EU. In Japan, with the Ministry of Education, Culture, Sports, Science, and Technology as the coordinator, Fujitsu, and Institute of Physical and Chemical Research are participating in the exascale computing program. On August 22, 2018, Fujitsu launched a new CPU that can be embedded in the next-generation Japanese supercomputer. The top ten supercomputers of the world by June 2018 are shown in Table 2.1. 3. Neuromorphic computing having broken through the existing computing architecture Neuromorphic computing has increased the sensing and self-learning capacity of computing systems, and it is expected to cover the existing digital technology. In recent years, the United States and EU are inputting a large quantity of R&D resources in it. For instance, the U.S. Department of Defense, National Science Foundation, and Air Force Research Laboratory have input hundreds of millions of dollars in it. In SyNAPSE sponsored by the U.S. Department of Defense, cognitive computers similar to the brain of mammals in form, function, and framework and robots whose intelligence is similar to that of rats or cats are developed. Different neuromorphic computing projects have been launched in the EU, which has input 200 million euros in its R&D. In the EU Human Brain Program, neuromorphic computing is a key part, for which five aspects have been studied, including neuromorphic computing itself, cognitive architecture, neuroinformatics, brain simulation, and neurorobotics. R&D platforms will be built for the studies. According to the curve of the latest technology maturity published by Gartner in 2018, Neuromorphic Hardware technology is on the increase, and its industry is expected to be mature in 10 years.

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2.2.2 Rapid Renewal of IC Technology 1. Computing chips Computing chips are divided into general and exclusive chips. The former includes CPU, GPU, and DSP; and the latter includes chips tailored to meet the demand of different products, such as FPGA and ASIC. In terms of CPU, Intel has released the i5 and i7 series of processors. In 2018, it released the i9-9900K processor, in which 8 cores and 16 threads are adopted, with the basic frequency of 3.6 GHz and the highest Turbo Boost of 5 GHz. The built-in 16 MB three-level buffer can support dual-channel memory and 16 PCI-E3.0 channels, with 14 nm++ process. With the development of cloud computing and big data, there is an increasing demand for high-performance servers, which has facilitated the rapid development of server CPUs. In 2017, the global CPU market volume was USD 48.29 billion, with a year-on-year increase of 6.3%.2 On the general CUP market, the X86 processor of Intel and AMD has 96% of the market share. Relying on the ecosystem formed by Wintel, Intel ranks first in the PC and server areas. It is followed by AMD, which has considerable market shares. In terms of GPU, NVIDIA has launched a number of chips oriented to graphic cards, high-performance computing, and drones. It has launched the latest Quadro RTX series of GPU, with the 12 nm process. The cloud service platform HGX-2 combines AI and high-performance computing, developing Jetson Xavier for robots and drones. GPU application has gone beyond graphic acceleration to VR, parallel computing, deep learning, and automatic driving. In 2017, the GPU market volume reached USD 6.89 billion, with a year-on-year increase of 41%.3 NVIDIA had 77% of the market shares. In terms of DSP, the development can be categorized into four stages, namely, single-core/single-operation component period, multi-operation component period, homogeneous multicore period, and heterogeneous multi-core period. To keep up with the demand for flexible structure, use in general situation, and complex algorithm handling, DSP and FPGA are usually combined, and embedding of DSP+FPGA structure or DSP in FPGA chips will be the trend of design. In 2017, the global market volume of DSP chips was USD 1.42 billion, up 12% on a year-on-year basis.4 Texas Instruments, ADI, and NXP provide DSP chips, which account for 85% of the market shares. 2. Memory chips In accordance with information savability, memory chips can be categorized into volatile memory and non-volatile memory (NVM). The former can maintain data with power on and lose the data with power off. It is categorized into DRAM and SRAM. The latter can maintain data even with power off, including ROM, EPROM, 2 Source:

Gartner Statistics, 2018. Gartner Statistics, 2018. 4 Source: Gartner Statistics, 2018. 3 Source:

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EEPROM, NAND/NOR Flash, and new types of NVM. DRAM and NAND Flash, as the major part of the memory chip industry, account for 97% of market shares. Samsung, SK Hynix, Micron, Toshiba, and Western Digital provide memory chips, which account for 92% of market shares. The steady development of mobile phones and the fast development of IoT, cloud computing, and big data contribute to the increase in the percentage of mobile memory and server memory. DRAM already sees its DDR 5, whose density and bandwidth are twice that of DDR 4. In July 2018, Samsung announced that it had developed LPDDR5-6400 memory chips, the first of its kind in the industry. Based on 10 nm (10–20 nm) technique, the single block of LPDDR 5 memory chip has the capacity of 8 Gb (1 GB) and the function verification of an 8 GB module prototype has been completed. Such memory chips can be applied to mobile APPs driven by 5G and AI. There are three trends in the development of NAND flash. First, its memory unit of a single block is shifting from SLC(Single-Level Cell)to QLC(Quad-Level Cell). Samsung, Toshiba, Western Digital, and Intel have launched flash memory based on QLC architecture and SSD (Solid-State Disk) based on QLC NAND to meet the increasing demand for memory capacity. Secondly, the process dimension of 2D NAND is shrinking, with the NAND technique coming to 1z nm. Samsung, Toshiba, and SK Hynix have put 16 nm process into mass production and are turning to 1z nm process. Thirdly, NAND flash tends to be three-dimensional. With the rapid development of 3D NAND, major manufacturers are deploying 3D technology while developing package techniques. Mainstream products that have been launched into mass production are 64-layer 3D NAND, and 96-layer 3D NAND is expected to be put into mass production in 2019. Column 1: Development of New Memories With the advent of the big data era, the rapid growth of data and development with data as the center has a high demand for the speed, capacity, power consumption, and reliability of memory. The size of existing memories are close to its limit, electrons tend to be micro-characteristic, and physical features of components consume power and give off heat, so traditional memory structure has some problems in stability and data reliability. Therefore, there has occurred new memory technologies in which new materials and new structures have been adopted, with PRAM, RRAM, MRAM, FeRAM, and STT-RAM as the representatives. In 2015, Intel and Micron jointly launched 3D XPoint technology in which PRAM is adopted. It can be used as DRAM memory and NAND, with its cost between the two, but its capacity 10 times that of DRAM, and its performance and life span 1,000 times that of NAND. Thus it caused a great sensation in its industry. In July 2018, Intel and Micron made a joint declaration about their cooperation in 3D Xpoint. They will continue to cooperate in the R&D of second-generation 3D Xpoint memory technology, which is expected to be completed in the first half of 2019. 3. Communication chips Communication chips include baseband chips and Radio Frequency (RF) chips. New technologies have been developed in the soft/hardware design of computing

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architecture, network connection architecture, and control system architecture. New types of device principles, the third-generation semiconductor materials, and new processes have been applied more extensively, and chips’ compatibility, transmission speed, and low power consumption performance have all been improved. Multimode multifrequency baseband chips are mainstream technical products. With the rapid development of chips supporting LET technology, baseband chips are expected to support LTE modes, with the downward compatibility of multiple modes, so that the users can shift from one network to another. Meanwhile, they are expected to support different frequency bands to meet the demand for international roaming. The automatic mode shift of multimode baseband makes the design much more difficult, requiring multimode protocol stacks to mix with each other to allow data communication between physical layers. Single chip manufactured by Qualcomm supports full mode, but for other basebands, two blocks or more are combined. It is a trend to integrate baseband with the application processor into an SoC (Systemon-a-Chip) solution. RF chips have three directions of their technology. First, a compound semiconductor is used widely in RF devices. The LDMOS (Laterally Diffused Metal Oxide Semiconductor) power amplifier bandwidth adopted at base stations will decrease with the increase of frequency, so it is applicable to the frequency lower than 3.5 GHz. The GaN power amplifier will become the first option in high-frequency communication of base stations in the 5G era. It can deal with MMW frequency of 50 GHz or above, and can support high bandwidth when the frequency remains high. Mobile phone RF, for which the GaAs power amplifier has been adopted, is the first option for high frequency and power in the 5G era. Secondly, BAW filters are replacing SAW filters. When the frequency is above 1.5 GHz, BAW has its advantage in performance. Thirdly, RF chips tend to be integrated. To meet the demand for micro and light mobile intelligent terminal, PA, LNA, switch and the duplexer will be integrated. In July 2018, Qualcomm released the world’s first fully integrated 5G new aperture millimeter-wave and RF module series below 6 GHz—QTM 052 millimeter-wave antenna module series and RF module series below QPM 56xx 6 GHz, oriented to smartphones and other mobile terminals. They can match up X50 5G modem, fulfilling the across—the-spectrum functions of a modem and an antenna and supporting compact package sizes for the convenience of mobile terminal integration. 4. Chip technology The most advanced mass production technology has reached a 7 nm level, and great breakthroughs have been made in 5 nm technology. It is expected to reach a 3 nm level. FinFET structure has been adopted. Due to the sharp rise of R&D cost and capital expenditure, some advanced process manufacturers have withdrawn from the market, and major competitors are TSMC, Samsung, and Intel. The latter is expected to launch 10 nm products in mass production after 2018, and 7 nm products after 2020. TSMC and Samsung have announced that they will adopt EUV photolithography, and will launch 7 nm products into mass production in the second half of the year

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2018. TSMC has begun to construct its 5 nm production line in 2018 and it will construct its factory for 3 nm products in 2020.

2.2.3 Cloud Tending to Be Integrated with Software Technology 1. Operation system (OS) Cloud computing OS is a new direction of development, characterized by hardware driving as the core, manufacturer-defined OS as the foundation and application to multiple scenarios as the direction. Google has proposed the cluster scheduling distributed system based on Kubernetes, which can provide operation and host management for the overall situation. That system is the mainstream solution for first-tier Internet businesses like Google, Alibaba, and Tencent. Amazon has proposed Amazon Linux 2, which can provide AWS cloud services outside the internal hosts of AWS. Microsoft Azure Stack has developed a mixed cloud solution and has launched with hardware manufacturers an integrated system, which will be put into commercial use in the first half of 2018. Netflix has opened sources for all technology stacks and will construct its own complex micro-service control platform through the conductor, compatible with Kubernetes through the spinnaker. Desktop and mobile OS technology are mature, with relatively centralized market shares. According to data from StatCounter, in September 2018, Windows of Microsoft and Mac OS X of Apple, respectively, accounted for 81.97% and 13.32% of the global desktop OS market shares while android of Google and iOS of Apple, respectively, accounted for 76.83% and 20.46%. 2. Cloud memory Google has launched Cloud-SOL Proxy and MySQL dilatation tool Vitess, which can provide safety control, sharing, and cluster optimization for mainstream open-source databases to match up multi-tenant isolation and reliable data memory in the cloud environment. They have been used massively in cloud of e-commerce and finance. Amazon has deepened its business based on object-based stage S3, having expanded the use area of ElasticCache. It can provide submillisecond delay based on Redis to support real-time APPS within the Internet, compatible with RedisAPI, and able to support APPS with the strictest requirements, such as games and financial service. 3. Software-defined networks (SDN) SDN is the integrated facility for hardware connection, exposing the controllable part of hardware through virtualization and application programming, so that hardware can be managed as required. Facebook, Google, Microsoft, and Yahoo use the OpenFlow protocol in their data centers, having jointly founded ONF to facilitate SDN and OpenFlow technology and standard, to promote the development of

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markets of products, services, applications, customers, and users. Cisco, IBM, and Microsoft have jointly launched the open-source SDN project named OpenDaylight. European Telecommunications Standards Institute(ETSI), from the perspective of network operators, has proposed the NFV architecture. SDN products of Amazon include VPC and AWS Direct Connect, which are, respectively, used to solve the problems of logic isolation within AWS cloud and exclusive network connection to AWS to the outside. Column 2: Google SDN In April of 2017, Google launched its Google SDN based on the OpenFlow protocol. It is made up of Espresso, Jupiter, B4, and Andromeda 4, Espresso for peer-to-peer connection with Internet service providers, Jupiter for the handling of traffic within an individual data center, B4 for connection between data centers, and Andromeda for network function visualization, monitoring, and management. Google SDN has been strictly tested for operation within the company. Espresso can undertake 20% of daily traffic and all new traffic of the company. It is the most mature SDN solution so far.

2.3 Cutting-Edge Hotspot Technology Highlights 2.3.1 Fast Development and Application of AI Technology 1. AI algorithm being innovated Cutting-edge AI algorithm theories are GAN, capsule networking, and transfer learning. The first was put forward by Ian Goodfellow in 2014. Through AI confrontation training, it can create original images, voices, and texts that are approximately authentic. The second was put forward by Geoffrey E. Hinton in 2017, able to handle multiple spatial alterations of different targets, demanding a small data size, able to identify the position and spatial relations that CNN cannot recognize. The third is a new technology of applying a model that has been learned to new areas to reduce the data size and training time needed by deep learning. 2. Emerging open-source software platforms for deep learning Most Internet giants have opened their software platforms for deep learning, to establish standard systems and industrial ecosystems in the era of AI. Generally, the opened platforms have something in common and something different in terms of model base building. Major platforms are TensorFlow of Google, MXNet of Amazon, Caffe/2+PyTorch of Facebook, and PaddlePaddle of Baidu. TensorFlow is the most widely used and active open-source software framework for deep learning. It has been developed by Google, famous for its comprehensive functions, compatibility, and ecosystem. There are other terminal software frameworks like Caffe2go and TensorFlow Lite of Google, Core ML, and Paddle-mobile of Apple, TensorRT of Intel, and NCNN of Tencent.

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3. Deep neural network model compiler The deep neural network model compiler, based on the function of traditional compilers, sees the expansion of its exclusive function-oriented for deep learning network model computing, and can solve the transferability and adaptability.5 Major compilers include NVIDIA’s CUDA, Intel’s nGraph, and University of Washington’s NNVM, which can all adapt to chips by integrating LLVM architecture. In practice, the intermediate presentation layer is the compiler’s data structure or code indicating the source code. The three mentioned compilers have their special middleware for optimization in that layer to fulfill its function. The intermediate presentation layer for expansion of function is a bridge in deep learning computing connecting different front-end training software frameworks with different rear-end expressions. It has two kinds, namely, NNVM/TVM and TensorFlow XLA. 4. Rapid progress in AI chip technology Major AI chips are GPU, FPGA, and ASIC exclusive chips. NVIDIA is the representative business of GPU, having developed Tesla P100, a deep learning computing unit, with GPU as the core, and Tesla P4 and Tesla P40, deep learning chips based on Pascal architecture. Xilinx and ALTERA are representative businesses of FPGA. The former’s FPGA hardware devices can help to deploy efficient neural networks, algorithms, and applications, and provide multiple development stacks and hardware platforms. ASIC is an IC specially designed for certain purposes, better than GPU and FPGA in terms of speed and power consumption. Google and Cambricon are representative businesses of ASIC. 5. Rapid development of basic application technologies (1) Automatic Speech Recognition (ASR) Automatic Speech Recognition (ASR) has two major applications, namely, intelligent speaker and intelligent voice. As for the former, Amazon has launched its Echo series, and Google, Google Home series. According to statistics released by Strategy Analytics, Amazon is the world’s leader in intelligent speaker, with the sales volume of Echo Dot and Echo accounting for 30% of the global total in the second quarter of 2018. The sales volume of Google’s Home Mini accounted for 20%. The intelligent voice assistant is embedded in various intelligent terminals, which has improved the user’s experience. For instance, Siri has been adopted for iPhone, and Cortana of Microsoft has been embedded in different social networks. Speech recognition technology is embedded in multiple products, services, and APPs.

5 In application, AI algorithm can be achieved through many software frameworks, while AI models

can be operated through relevant hardware, which can cause two problems: how deep learning models can transfer into each other and how can software frameworks and chips adapt to each other?

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(2) Visual recognition technology There are three hotspot applications of visual recognition technology. First, face recognition technology is mature, widely used in safety protection, education, communication, medical care, and finance. For instance, iPhone X released in September 2017 helped to introduce 3D face recognition to the public for the first time. Secondly, video structuring is emerging. For example, in April 2018, SenseTime released the SenseVideo-A Platform, on which a football shoot clip can be made automatically. Thirdly, the capability of natural form identification is improved through detection, identification, and tracing of the human body in images. Such technology can be used extensively in computer games and robot control. (3) Natural language processing technology Natural language processing technology is applied to machine translation, personalized recommendation, Q&A system, information retrieval and filtering, and information extraction. The very first area is the hottest application area. Microsoft, Google, and Baidu have improved the translation quality and language coverage through their natural language processing technology. By October 2018, Google Translation had been able to cover 103 languages. Other systems have been applied to major ecommercial platforms and news clients, such as Amazon, Tmall, and JD. In October 2018, Google released BERT (Bidirectional Encoder Representations from Transformers) Model. It performs well in SQuAD 1.1, the top-level proficiency test of machine reading comprehension, does better than human in measure indicators, and has achieved the best in 11 languages test. Column 3: AI Development in Some Countries 1. The United States The United States is the country with the strongest basic AI research and talent force, the largest number of relevant businesses, and the best industrial layout. It has a large number of Internet giants and AI businesses, such as Apple, IBM, NVIDIA, and Boston Dynamics, as well as universities like Stanford University, University of California, Berkeley, Carnegie Mellon University, Harvard University, and Princeton University. Its industrial layout and research cover machine learning, basic algorithm theories, deep learning framework platforms, chips and OS, automatic driving, medical imaging, robots, and face recognition. According to the latest data released by CAICT (China Academy of Information and Communication Technology), by the first half of 2018, there were 2,039 AI businesses in the United States, with 28,500 million relevant talents, accounting for 14% the world’s total and ranking first in the world. The Trump government is showing more concern about AI. On May 10, 2018, the White House gathered the managers of over 40 businesses to an AI summit, including Google, Amazon, and Intel. At the summit, the AI committee was founded to be in charge of the coordination of policies, industries, studies, and researches of AI. Some proposals on AI development were also put forward. The military forces

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of the United States attach importance to AI R&D and application, planning to invest USD 1.7 billion in the coming 5 years for the establishment of new joint AI centers. 2. The United Kingdom The United Kingdom is a country powerful in AI technology, having Oxford University, Cambridge University, Imperial College London, and the University of London and think tanks and research institutions represented by Alan Turing Institute. Their innovations have been applied throughout the country. With a good ecosystem for AI R&D, the country’s businesses are active in innovation, with many incubators of science and technology, which contribute to the development of AI startups. For instance, DeepMind used to be a startup of the University of London, but it was acquired by Google. The United Kingdom has the most AI businesses in Europe. According to the latest data released by CAICT, in the first half of 2018, there were 392 AI businesses in the country, which has the highest investment/ funding for AI in Europe. From 2013 to the first quarter of 2018, its investment/funding for AI accounted for 6.2% of the global total, ranking first in Europe. The UK government attaches importance to the impact of AI on economic and social development. On April 16, 2018, Select Committee on Artificial Intelligence under the Parliament issued AI in the UK: ready, willing and able?, according to which the United Kingdom has the capability of becoming the leader of the world in AI. 3. Germany Germany has seen remarkable achievements in AI based on its Industry 4.0. Among the 10 scientific institutions having published the most AI papers in the world, three are from that country, in which DFKI, the world’ s largest nonprofit institution of AI has been established. DFKI’s research covers all AI industries. Attaching importance to AI, the government released Strategie Künstliche Intelligenz der Bundesregierung, and will launch national strategies to promote the country’s AI R&D and application to a leading level in the world. 4. Japan The Japanese government and industry are realizing the importance of AI to some economic and social problems like aging, so they are taking advantage of the robot industry and manufacturing to develop AI. In 2016, the government founded the AI Technology Strategy Committee, identified some projects with AI as the core, together with big data, IoT, and cybersecurity, and promised to support research staff. In the same year, the Ministry of Economy, Trade and Industry defined the year 2017 as Japan’s First Year of AI. Businesses of that country have increased their input in those areas. For instance, Softbank acquired ARM of the UK at the cost of 23.4 billion pounds and large car manufacturers like Toyota and Honda have begun their automatic driving R&D. 5. India As a later comer in the field of AI, India has advantages in AI necessary for a big country, such as a big research team, a mature environment for business, and the expanding Internet market. According to statistics, the country has over 800 businesses having deployed or deploying AI. The government is attaching

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importance to development, and has increased the input in it in its financial budget of 2019, and decided to invest considerably in research, training, and skill development concerning AI, digital manufacturing, blockchain, and machine learning. Meanwhile, a special committee has been established to study the possibility of AI’s application in all areas and problems that may occur in the wide application of AI.

2.3.2 Progress in Blockchain Technology The development of blockchain technology has seen two stages, the first characterized by blockchain used as payment currency represented by BTC and LTC, and the second by blockchain with smart contract function of Turing completeness represented by ETH and EOS. Today, the technology covers the computer, storage, and monitoring. The former one provides and integrates base computing and hardware for blockchain, divided into VGA and ASIC computers. In August 2018, CAN of China released the world’s first 7 nm-chip BTC computer, with the technology as the highest level of the semiconductor industry. Blockchain provides decentralized solutions to data storage. For example, the end-to-end encrypted storage can scatter information and make full use of idle hardware storage resources, so it is safe and reliable, able to protect the privacy and reduce cost. There are such decentralized solutions as IPFS, Storj, and Siacoin. Supervision technology can ensure that blockchain technology will not be used for the crime but can protect the fund and national security, which is a prerequisite for the technology’s extensive application. The UK Government was the first to propose the concept of Regulatory Sandbox.6 Australia, Singapore, and China have made the same attempt. The current blockchain technology is applied in areas like digital currency and insurance securities, and expanded into medical care and health, and logistics and other areas.

2.3.3 Quantum Information Technology Leading to New Waves of Industry and Research 1. Quantum communication Based on quantum mechanics, quantum communication refers to the coded information transmission in quantum state, including quantum teleportation, key distribution, and dense coding. Quantum teleportation is used for transmission of unknown quantum state between quantum network nodes, and its core is the establishment of quantum entanglement between super-long distance nodes. The core concept of quantum key distribution is the indistinguishability between nonorthogonal quantum 6 Regulatory

Sandbox is the “security space”, where fintech businesses can test their innovative financial products, services, commercial modes, and marketing means, without the necessity to be immediately subject to supervision rules in case of any problems.

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states (equivalent to no-cloning theorem). It can distribute keys between secret communication nodes. In August 2018, Pan Jianwei and his team members from China, with the help of Mozi Satellite, succeeded in the distribution of star-to-earth spoofs state quantum key and increased the distance to 1,200 km. Quantum dense coding can be taken as the reverse process of its teleportation, transmitting the information of two typical bits between nodes at the cost of one quantum bit. It can increase channel capacity exponentially. In July 2018, Guo Guangcan and his team members from China succeeded for the first time in the world in quantum dense coding through four-dimensional entanglement, increasing channel capacity to 2.09, the highest of the world till now. Technical breakthroughs have to be made in nodes, channels, repeaters, and memories for large-scale quantum communication networks. In May 2018, Matthias Bock from Germany succeeded in taking optical frequency conversion as the quantum repeater and hence establishing quantum entanglement between a single atom and a photon. 2. Quantum computing Quantum computing is aimed to operate the information stored in a quantum bit and read the computing result by measuring. Superposition and entanglement of a quantum state can, as a new resource, be used with the proper quantum algorithm to accelerate the solution to some special problems, which, to some extent, is kind of “quantum hegemony” (overwhelming advantage of quantum computing over typical computers in computing power). According to scenarios, quantum computing devices can be divided into general quantum computers and functional quantum simulators. The former’s building requires large-scale expansive quantum bits (able to entangle with each other for a long time) and high-fidelity quantum gates. As for quantum programming language, Microsoft released in November 2017 Q# as part of its quantum development toolbox, which received good response from researchers. Quantum computers can be categorized into non-topological quantum computers and topological ones. Most companies, higher learning institutions, and research institutions are developing quantum computers based on the non-topological system, including superconductivity, ion traps, and semiconductor quantum dots. Superconductivity technology is the most mature. For instance, Intel delivered the 49-bit quantum chip Tangle Lake in January 2018, and Google released the 72-bit quantum processor Bristlecone in March 2018. Both of them were based on the superconductivity system. On the other hand, non-topological quantum computers may be disturbed by quantum bit decoherence and the environment, so they have their own disadvantages. Topological quantum computers encode topological quantum bit through the fractional excitation model of the topological state, and they have the advantage of noise resistance and super-long decoherence. Microsoft is one of the representative businesses in developing such computers. Column 4: European and American Countries Have Made Quantum Information Technology Development Plans All branches of physics have great energy in promoting technical revolutions and the progress of different eras. For instance, the development of thermodynamics

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brought humankind into the era of steam turbines; the maturity of electromagnetism ushered in electrification; and semiconductor studies brought about information technology. Quantum mechanics is no exception. That is why the governments of different countries are increasing their input in quantum information technology to seize the opportunity for a potential technical revolution. In September 2016, the EU put forward Quantum Technology Flagship, according to which one billion euros will be input into the technology in the coming 10 years. It covers the support of the system that can easily see its market transformation, such as quantum communication networks, super-sensitive cameras, quantum simulators that can help to design a new material. It also covers long-term projects, such as general quantum computers and high-precision sensors used for mobile phones. In December 2016, the UK Government Office for Science released The Quantum Age: technological opportunity, according to which today is the eve of the second quantum revolution, and five areas are chosen as key R&D areas, namely, atomic clock, quantum imaging, quantum sensor and measuring, quantum computing and simulation, and quantum communication. Hungary, Austria, and Germany, subsequently, announced their plans on quantum technology. On June 27, 2017, the U.S. House of Representatives passed the National Quantum Initiative Act, according to which the United States will invest USD 1.1 billion in quantum technology in the coming 4 years. The country will make the National Quantum Initiative Plan of 10 years, establish the National Quantum Coordination Office in the White House Office of Science and Technology Policy and authorize the Department of Energy, National Institute of Standards and Technology (NIST), and National Science Foundation (NSF) to appropriate USD 1.275 billion as the fund for quantum information research from 2019 to 2023. On September 24, 2018, the White House Office of Science and Technology Policy organized a quantum summit to discuss the next-generation technical strategies, with participants from the Department of Defense, National Security Agency, White House National Security Council, National Aeronautics and Space Administration, Department of Energy, Department of Agriculture, Department of Homeland Security, Department of State, and Department of the Interior, and giant businesses such as Honeywell International, Lockheed Martin, Goldman Sachs Group, AT&T, Intel, and Northrop Grumman. 3. Quantum sensing Quantum sensing is a measuring method of converting the measured physical quantity and outputting the result by using quantum mechanical properties. In comparison with classical sensing, quantum sensing is nondestructive, real-time, sensitive, stable, and multifunctional. Representative achievements in recent years include the NV corebased nanoscale high-precision imaging by UC Santa Barbara in 2016, and the singlephoton Kerr effect measurement of Heisenberg limit accuracy by Guo Guangcan and his team in August 2018. Based on quantum sensing technology, many physical quantities can be sensed and measured in high precision, such as light, magnetic field, gravity, and angular velocity. This technology can be used widely in scientific research, national defense, and economic construction. For instance, the atomic clock can tell the time precisely, the atomic interferometer can be used in inertial guidance and can be transformed into a gravity meter used in the detection of the earth system and precise location of minerals.

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2.3.4 Steady Development of IoT Sensing Technology 1. Short-distance wireless communication technology Short-distance wireless communication technology includes two models, namely, Wi-Fi HaLow and Z-Wave. The former is low-power Wi-Fi technology based on the IEEE 802.11ah standard and can be operated in frequency bands of 2.4, 5 GHz, and 900 MHz, able to double the 802.11ac Wi-Fi signal coverage. All countries are constructing the Wi-Fi HaLow network. The latter is the short-distance wireless communication technology applicable to networks, based on radio frequency led by the Danish company Zensys, with low cost, low power consumption, and high reliability. With this technology, the signal coverage of frequency bands of 908.42 and 868.42 MHz can be 30 m inside and 100 m outside, so it can be used in scenarios of narrow bandwidth. 2. IoT OS Major IoT OS includes FreeRTOS, Mbed OS, and Ostro Linux. FreeRTOS is a light operation system adopting Linux open source, with functions like task management, time management, semaphore, message queue, memory management, and recording, able to meet the demand of small systems. Mbed OS is an open-source OS platform designed by ARM, providing C/C++ SDK and supporting all controllers based on the Cortex M series. Ostro Linux is Intel’s OS based on Yocto Project. It can support many wireless technologies and provide a sensor framework. With attention to IoT safety, it can provide protection for OS, devices, application programs, and data. 3. Edge computing Edge computing aims to produce faster network service response by processing data at the terminal or data source through computing at the edge. AWS Greengrass launched by Amazon provides edge computing +IoT cloud platform capacity. Azure IoT Edge released by Microsoft expands cloud analysis to edge devices. It can be used offline. Google has also launched two new products, namely, the hardware chip Edge TPU and the software stack Cloud IoT Edge to improve the development of edge networking devices. Quite a few businesses are starting edge computing R&D, including Cisco, General Electric (GE), Intel, Dell, and IBM. 4. IoT cloud platforms Globally famous IoT platforms include PTC’s Thingworx, IBM’s Watson, GE’s Predix, and Amazon’s AWS IoT. ThingWorx is an early AEP platform, and the leader of IoT cloud platforms, which provides basic IoT functions like device access and management and data management, and fast development application functions like visual drag and mashup. IoT cloud platforms integrate various IoT and industrial control protocols, so that all kinds of devices can be connected.

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2.4 Integrated Development of Network Information Technology and Traditional Areas 2.4.1 Accelerated Intelligent Manufacturing Technology Application 1. Deepening software definition manufacturing (SDM) As intelligent manufacturing deepens, the border between MES and ERP and the control system is becoming obscure, which leads to repetition between software products and between function models. To this end, ISA-SP95 has proposed MOM, which can help to gather individual functional software products into one system with a unified standard through digitalized or database platforms, so that the border between management, execution, and control can be clarified, and hence the management of maintenance, quality, and repertory can be enhanced and improved. Dassault of France has launched DELMIA Apriso, an integrated operation management platform, which raised its ranking from 11th in the 2017 Global 100 Most Sustainable Corporations to first in the year 2018. It covers all systems like MES, WMS, LES, and QMS. MOM’s role as the “commander” in top-level application, service, and analysis has made SDM more realistic. 2. Digital Twin technology starting to be sued in industry Digital Twin technology can reduce industrial production costs through the integration between virtual and real manufacturing. In 2000, Siemens was the first to propose the unified data model concept based on the high integration of “product digital twin”, “production technique digital twin”, and device digital twin”. Digital Twin has seen the deepest use in the aerospace industry. For instance, Lockheed Martin, with such technology, has reduced the production time of the fifth-generation F-35 Fighter Craft from about 22 months to 17 months, attempting to reduce the cost from USD 94.6 million to USD 85 million or lower before 20207 ; and Airbus is cooperating with Ubisense in supporting factory digitalization with Digital Twin. 3. Human–machine collaboration being applied The integration of AI, industrial automation, and VR has promoted the application of human–machine collaboration in workshops, mainly in the manual process which could not see automation or did not conform to ergonomic requirements before. Hence, flexibility in manufacturing is maximized, the repeatable process can be completed in high quality and the danger of wound and infection has been reduced. Robots can change themselves from hard bodies into “soft ones”, able to sense and recognize relatively small additional external forces and make a corresponding 7 Liu

Yawei, Lockheed Martin Increases the Speed of F-35 Fighter Craft, WeChat Account “Observation of Aerospace Defense”, December 27, 2017.

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response. Workers can simulate operations and give demonstrations through wearables or AR to realize soft production. KUKA LBR iiwa robot can find coordinated production solutions by using intelligent control technology, high-performance sensors, and advanced soft technology. With KUKA flexFellow mobile platforms, robots can provide the best support at the production load peak and resource bottleneck without being confined by their locations and tasks. During the production of BMW automobiles, previously, workers had to carry and connect the bevel of the front axle gearbox, but now they can work with their LBR iiwa robot “colleagues” in narrow space, without the necessity of separation and erection of rails. Human is in the core position again in intelligent manufacturing, which can be seen as humanism, despite the pursuit of unmanned technology in the past. 4. Accelerated integration of the intelligent manufacturing service ecosystem With the increasing demand of businesses for breaking the “island” between data, between automatic devices and between information systems and manufacturing systems, information and industry integrated technology application is shifted from a single product and single-function application to systematic solutions. Consequently, global digitalized solution providers are cooperating with each other to accelerate the expansion of the ecosystem. Siemens, who can provide digitalized solutions for all industries based on its own soft/hardware, has deployed its MindSphere on the AWS cloud computing service platform to provide open programming interface and a stronger open environment for the construction of an ecosystem with the platform as the central hub. It has developed over 50 industrial APPs in collaboration with Amazon, Microsoft, SAP, and Accenture. Microsoft, based on the Azure cloud computing platform, has constructed its industrial ecosystem and is strengthening its cooperation with automation giants such as ABB, Schneider Electric and Rockwell Automation in business, management, operation, control, and scene as well as in product design, production, distribution, and value-added service.

2.4.2 Expanding Intelligent Medical Technology Application 1. Scenario of intelligent medical care technology applications Information technologies like AI are used in medical imaging, medicine development, health management, and medical robots. In the very first field, AI visual identification technology can help to read and analyze fast the film of medical imaging so that radiologists can diagnose the disease through the accurate marking of the anomaly structure. Thanks to AI semantic recognition technology, in medicine development, a large amount of medical research information and result can be searched, extracted, and classified, so that research staff can quickly master the latest information and shorten the time of medicine R&D and thus improve the R&D efficiency and control the cost. In health management, smart terminals can monitor health parameters, and

2.4 Integrated Development of Network Information Technology …

41

help to put them on the archive and to analyze them, so that personalized health assessment management schemes can be set up. Medical robots can be used in surgeries, functional rehabilitation, and auxiliary nursing and they can replace doctors in conducting more accurate, efficient, and secure operations. Besides, they can be used in different scenarios like gene sequencing and medical archive virtualization. 2. Major participants in intelligent medical care IBM Watson released by IBM can rapidly screen and learn the files and records of cancer patients and hence provide doctors with referential diagnosis and treatment schemes. It can also serve medicine R&D businesses, contributing to medicine R&D by providing a large number of clinical reports, data, and research results. AliHealth released the medical care system Doctor You, which involves clinical medical research diagnosis platforms, auxiliary medical test engines, and physician capacity training systems, with the pulmonary nodule recognition accuracy rate amounting to over 90%. In November 2017, Google DeepMind Health, by learning the sections of breast cancer cells, succeeded in rapidly recognizing new breast cancer sections. In March 2018, Empower MD released by Microsoft could learn automatically and record information online by listening to the conversation between a doctor and a patient. It can also give doctors its advice to reduce the workload of the latter. In July 2018, the AI system which can screen colon/rectum tumor was released by Tencent Miying. It can detect colonic/rectal polyps and identify their nature, with the realtime location accuracy rate reaching 96.93% and the glandular cancer identification accuracy rate, 97.02%. Column 5: Doctor Zhuo, a New Model of AI Enabling Digital Medical Care According to statistics, the annual growth rate of China’s medical imaging data is 30% while the annual growth rate of the number of radiologists is only 4.1%. Take the pulmonary nodule as an example. The missed diagnosis and misdiagnosis rate is as high as 45%. It is urgent to solve the problems of medical supply and demand and medical service quality. In 2017, Doctor Zhuo, which was developed by Hangzhou Jianpei Technology, was shown in CCTV’s Jizhi Guoren Program. It not only won the championship of LUNA 2016 World Challenge, but also the METIS Award, the highest award launched by the Ministry of Industry and Information Technology, with technical innovation capacity as the judgment standard. As a smart medical care product with the proprietary intellectual property right, Doctor Zhuo has been applied successfully in over 50 A-level hospitals. Based on it, Jianpei has launched Smart Imaging Cloud and Zhuo Imaging. In the former, AI is integrated into imaging cloud, which can explore and analyze medical data and hence improve diagnosis level and efficiency. The latter is in charge of image data’s multilevel application, carrying user-friendly APPs like cloud film and long-distance consultation. Both of them have been connected to over 300 hospitals and over 700 devices.

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2.4.3 Maturing Automatic Driving Application 1. Rapid development of automatic driving technology Automatic driving technology involves environmental sensing, decision-making and planning, control, and implementation. Environmental sensing technology can provide policy-making support for vehicles through vehicle sensors and communication technology. It involves two technical solutions: multi-sensor integration dominated by the video camera and technology dominated by the laser radar. The core of decision-making and planning technology lies in decision algorithm and processing chips, the former including three kinds, namely, that based on rules, that based on neural network and that based on mixed lines; and the latter including EyeQX™series of automotive computing platforms developed by Mobileye and NVIDIA Drive PX series of automotive computing platforms developed by NVIDIA. Control and implementation technology includes vehicle control systems and Internet of Vehicles. DSRC Internet of Vehicles technology is relatively mature, and operators represented by Huawei and Qualcomm are developing LTE-V technology. 2. Application of automatic driving technology Waymo, a subsidiary of Google, has launched a complete automatic driving solution, including all technologies of soft/hardware. Vehicles with integrated systems can be L4 ones, driven completely by the systems automatically, rather than by a human. Only very occasionally will there be uncertainties, and hence a human driver will be necessary. This automatic driving solution includes advanced auxiliary driving technology, vehicle sensor technology, automatic driving decision-making software, and vehicle safety system. The simulator developed by Waymo enables vehicles to make simulations in a virtual world and learn automatically the complex road conditions, so that they can have prior knowledge and apply it to the real world and keep correcting it. Major automobile manufacturers across the world have developed and commercialized some automobiles with automatic driving functions. In July 2017, Audi released Audi A8, the world’s first L3 MP car with the automatic driving system. It carries 12 ultrasonic sensors, 5 video cameras, 5 mm-wave radars, 1 laser radar, and 1 IR camera as well as 24 vehicle sensors, so that it can do L3 automatic driving when the speed is below 60 km/h. In January 2018, Cruise Automation, the automatic driving department of GM, released the fourth-generation pilotless automobile Cruise AV, which contains no wheel, accelerator pedal, or braking pedal, but 21 normal radars, 16 video cameras, and 5 laser radars to sense the surroundings and barriers around it. In June 2018, Tesla announced that its Autopilot system to be updated will have a complete automatic driving function.

Chapter 3

World Digital Economy Development

3.1 Overview With the accelerated breakthroughs and applications of the new-generation information technology represented by AI and quantum information, the world is witnessing the economic development dominated by information technology. With new industries, new operations, and new models, IT is playing an increasingly important role in the transformation and updating of traditional industries, and digital economy is becoming the new drive of the global economic resurrection. (1) Digital economy is the engine of global economic growth. In 2017, the global digital economic volume was USD 12.9 trillion, accounting for 17.1% of the global total GDP1 . China and the United States are the “twin leaders” in the field of digital economy. (2) Globally segmented areas of digital industrialization witnesses sound development. In 2017, the semiconductor market volume of the world reached USD 412. 2 billion, up 21.6% in comparison with that of 2016, which shows a strong acceleration. In the same year, the cloud computing service market volume was USD 260.2 billion, up 18.5% in comparison with that of 2016, and the big data market volume was about USD 35 billion, up 25%, witnessing rapid development. (3) Global manufacturing is developing into intelligent manufacturing. The deep integration between the new-generation information technology and manufacturing technology is speeding up the reform of production mode. Smart devices represented by industrial robots and 3D printing are used widely, and the United States, Japan, and Germany are leaders of global intelligent manufacturing. In 2017, the global intelligent manufacturing market volume was USD 1,456.8 billion, up 13.4% from that of 2016. (4) The global e-commerce market is growing fast. In 2017, the world’s online retail volume was USD 2.3 trillion, up 24.8% from the previous year, accounting for 1 Source:

Huawei, Global Industry Outlook GIV2025 Report.

© Springer Nature Singapore Pte Ltd. 2020 World Internet Development Report 2018, https://doi.org/10.1007/978-981-15-4067-7_3

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(5)

(6)

(7)

(8)

3 World Digital Economy Development

10.2% of the total retail volume of the world. Emerging markets like Asia, Latin America, the Middle East, and Africa are becoming the new drive of global e-commerce growth. The deep integration of digital technology into the service industry facilitates shared economy, Internet medical care, online education, and online tourism. Service outsourcing and intelligent logistics are being industrialized rapidly. Ecosystem-friendly development is a universal choice. Competition between businesses is shifting from the competition on technology, products, and supply chain to that on platform ecosystems. Industrial leaders are using their core technologies, user resources, and data to interact and coordinate with individual users, financial institutions, governments, higher learning institutions, and other businesses in order to form a full-chain ecosystem. Financial science and technology are developing fast across the world, forming comprehensive and multiple service systems represented by P2P online loaning, crowdfunding, third-party payment, and Internet money management. The development of financial technology is accelerating financial inclusiveness, providing convenience for micro- and medium-sized businesses and entrepreneurs of India, Southeast Asia, and Africa. Development of digital economy calls for openness and cooperation. All countries are expected to strengthen their cooperation in promoting digital industrialization and industrial digitalization and producing talents in digitalization, to formulate international rules and standards more equally and to advance cooperation in information technology.

3.2 Generally Fast-Developing IT Industry 3.2.1 Accelerated Recovery of Electronic Information Manufacturing 1. Growth of global electronic production Digital economy plays an important role in the global economy. Global Industry Outlook GIV2015 Report released by Huawei shows that in 2017, the global digital economy volume was USD 12.9 trillion, accounting for 17.1% of global GDP. As for the segmented market, the markets of electronic products, semiconductors, and electronic components are recovering fast. According to the World E-data Yearbook 2017, the annual e-product output value reached in 2017 USD 1.79 trillion, up 4.02% from the previous year; and its sales volume reached USD 1.76 trillion, up 3.03%. Both the production and marketing values are increasing fast. The output value of China’s e-products amounted to USD 6 82.491 billion, up 3.45%. ROK has surpassed Japan and became the third-largest electronic product manufacturer, and Vietnam has replaced Brazil in being at the

3.2 Generally Fast-Developing IT Industry

45

Table 3.1 Top 10 countries and regions in E-product output value (2016–2017) (Source Annual Report on the Development of World Information Technology Industry (2017–2018)) Countries and Regions

2016 Output value (0.1 billion U.S. dollars)

Growth rate (%)

Output value (0.1 billion U.S. dollars)

2017 Growth rate (%)

Chinese Mainland

6,597.5

−1.46

6,824.9

3.45

The United States

2,294.6

−0.67

2,340.5

2

ROK

1,116.5

3.38

1,217.2

9.02

Japan

1,159.8

2.57

1,163.5

0.32

Chinese Taiwan

689.2

1.91

753.7

9.36

Singapore

591.7

5.13

676.8

14.38

Germany

553.8

−0.35

565.2

2.05

Malaysia

502.3

−3.11

529.4

5.39

Mexico

494.9

−0.49

493.7

−0.26

Vietnam

403.5

9.9

448.9

11.25

bottom of the list of the value. The top 10 countries and regions in the e-product output value from 2016 to 2017 are shown in Table 3.1. In 2017, China’s e-product sales amounted to USD 470.8 billion, up 6.02% from the year 2016, while the United States’ sales was USD 4 25.23 billion, up 1.57%, against the negative growth rate before. In Europe, Germany, the United Kingdom and France are the top three in that respect, all maintaining steady growth. Other countries and regions in the Asian and Pacific region witness rapid growth in e-product sales. Top 10 countries and regions in e-product sales from 2017 to 2020 are shown in Table 3.2. 2. Rapid growth of the semiconductor market According to World Semiconductor Trade Statistics (WSTS), the global semiconductor sales in 2017 reached USD 412.2 billion, up 21.6% from the previous year. From January to July 2018, the figure was USD 267.2 billion, up 19.3% on a year-onyear basis. The total sales of 15 big semiconductor businesses, including Samsung, Intel, SK Hynix, TSMC and Micron, amounted to USD 182.333 billion in that period. The global semiconductor sales and growth rate from 2008 to 2017 are shown in Fig. 3.1. By region, North America saw the sales of USD 86.5 billion, up 31.9% on a yearon-year basis, accounting for 21% of the world’s total market shares and ranking first in the world. The sales of Europe and Japan accounted for 9%, respectively, of the global total while the sales of other regions amounted to USD 247.8 billion, up 18.9%

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Table 3.2 Top 10 countries and regions in E-product sales (2017–2020) (Source Annual Report on the Development of World Information Technology Industry (2017–2018) (unit: 0.1 billion U.S. dollars) Countries and regions

2017

Expected figure in 2018

Expected figure in 2019

Expected figure in 2020

The United States

4,252.3

4,337.9

4,400.8

4,490.5

Japan

1,281.1

1,302.2

1,321.4

1,337.8

China

4,708

4,879.3

5,007.2

5,170.6

West Europe

2,461.2

2,506.9

2,555.4

2,600.9

Other Asia-Pacific countries and regions

3,874.8

4,033.6

4,157.8

4,309.5

17,561.4

18,073.1

18,489.9

18,996.6

Global total

Fig. 3.1 Global semiconductor sales and growth rate (2008–2017) (Source WSTS)

on a year-on-year basis, accounting for 61% of the world’s total. The semiconductor market distribution of the year 2017 is shown in Fig. 3.2. By field, IC sales in 2017 was USD 343.2 billion, accounting for 83.3% of the total of semiconductors. The market volume of memories, logic circuits, microchips, and analog circuits was respectively USD 124 billion, 102.2 billion, 63.8 billion, and 53.2 billion, up 60.1, 10.8, 4.2, and 10.2%, respectively, on a year-on-year basis. The sales of memories contributed over two-thirds of the growth to global semiconductor sales, as the major drivers of the market. The growth was owed to the rise of the price. For instance, DRAM and Nand Flash memories saw their price rise by over 50% in 2017.

3.2 Generally Fast-Developing IT Industry

47

Fig. 3.2 Semiconductor market distribution (2017) (Source WSTS)

The global semiconductor sales and growth rate from 2016 to 2017 are shown in Fig. 3.3. 3. Steady growth of the electronic component market According to the Annual Report on the Development of World Information Technology Industry (2017—2018), the output value of global electronic components reached USD 591.12 billion in 2017, up 8.72% from 2016. The Chinese Mainland was the only region whose electronic components output value was over USD 100 billion, that is, USD 151.474 billion, up 8.69% from the previous year, accounting for 25% of the global total. Singapore took the lead in the growth rate with 21.65%,

Fig. 3.3 Global semiconductor sales and growth rate (2016–2017) (Source WSTS)

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Fig. 3.4 Percentage of electronic component output value of major countries and regions (2017)

then came ROK and Chinese Taiwan, whose growth rate was, respectively, 14.6 and 12.7%. The percentage of the electronic component output value of major countries and regions in 2017 is shown in Fig. 3.4. In terms of turnover, among the top ten biggest businesses of electronic components in 2017, seven were from the United States; among the top 20, 16 were from the United States, who remains a big country of those products. 4. Slowing-down growth of the smartphone market According to data released by IDC, in 2017, the global shipment quantity of smartphones was 1,472 million, down one percent from the previous year. In the second quarter of 2018, the figure was 342 million, down 1.8%. Samsung ranked first with its 71.5 million, accounting for 20.9% of the global market shares. Huawei ranked second, surpassing Apple for the first time and accounting for 15.8% of the market shares. The shipment quantity of Apple, Mi, and OPPO was, respectively, 41.3 million, 31.9 million, and 29.4 million, ranking third, fourth, and fifth, respectively. According to IDC, the demand for the Asia-Pacific market remains the drive for the production of smartphones. In the year 2018, the shipment quantity growth rate of India was 14.4% while that of Indonesia was over 15%. The shipment quantity of smartphones from the third quarter of 2017 to the second quarter of 2018 is shown in Table 3.3. 5. Active market of wearables With the rapid development of a series of wearables such as smart bracelets, Bluetooth earphones, and sports watches, the market of wearables is expanding. According to IDC statistics, in the second quarter of 2018, the shipment quantity of wearables

3.2 Generally Fast-Developing IT Industry

49

Table 3.3 Shipment quantity of smartphone (Q3 of 2017–Q2 of 2018) (Unit: million) (Source IDC) Businesses

Country

Q3 of 2017

Samsung

ROK

Huawei

China

Apple

The United States

Q4 of 2017

Q1 of 2018

Q2 of 2018

83.3

74.1

78.2

71.5

39.1

41

39.3

54.2

46.7

77.3

52.2

41.3

Mi

China

27.6

28.1

28

31.9

OPPO

China

30.7

27.4

23.9

29.4

Others

–

145.7

155.6

112.7

113.7

Global total

–

373.1

403.5

334.3

342

amounted to 27.9 million, up 5.5% on a year-on-year basis; their sales reached USD 4.8 billion, up 8.3%. The shipment quantity is expected to reach 133 million in the whole year. The shipment quantity and market shares of wearables in the first half of 2018 are shown in Table 3.4. In the second quarter of 2018, North America, Japan, and West Europe saw a year-on-year decrease of 6.3% in sales of wearables. The decrease in sales of smart bracelets and the insufficient growth of smartwatches both contributed to the decrease. The sales of wearables in emerging markets such as the Asia-Pacific Region (excluding Japan), Middle and East Europe, the Middle East, Africa, and Latin America increased 14% on a year-on-year basis. In those markets, the demand for smart bracelets is increasing and smartwatches enjoy high popularity among consumers. Table 3.4 Shipment quantity and market shares of wearables in the first half of 2018 (Source IDC) Businesses

Country

Q1 of 2018 Shipment quantity (million)

Q1 of 2018 market shares (%)

Q1 of 2018 shipment quantity (million)

Q2 of 2018 market shares (%)

Apple

The United States

4

16.1

4.7

17

Mi

China

3.7

14.8

4.2

15.1

Fitbit

The United States

2.2

8.7

2.7

9.5

Huawei

China

1.3

5.2

1.8

6.5

Garmin

The United States

1.3

5.0

1.5

5.3

Others

–

12.6

50.3

13

46.6

Global total

–

25.1

100

27.9

100

50

3 World Digital Economy Development

3.2.2 Recovering Basic Telecommunication Industry of the World 1. Steady growth of telecommunication income The development of global digital economy has facilitated the growth of basic telecommunication services. The income of that industry in 2017 reached USD 1.59 trillion, up 1.2% from 2016, with its growth rate up 0.4%. The global telecommunication development from 2013 to 2018 is shown in Fig. 3.5. In 2017, data income accounted for 58.2% of global telecommunication income, up 2.7% from 2016. The income of mobile data accounted for 36.5%, up 2.4%; that of fixed data accounted from 21.7%, up 0.3%. According to Gartner, in 2018, the income of data across the world will account for over 60%. The structure of global telecommunication income is shown in Fig. 3.6. 2. Popularization of smartphones boosting the growth of mobile traffic According to statistics from GSMA Intelligence, by the end of 2017, there were 7.82 billion mobile phone users, and 2.5 billion 4G users, with the number higher than that of 3G users for the first time. There were 2.5 billion smartphone users, the popularization rate being 58.2% and Asia and Africa witnessing obvious growth. The number of global users of all systems and cellular M2M from 2013 to 2018 is shown in Fig. 3.7.

Fig. 3.5 Global telecommunication development (2013–2018) (Source Gartner, The World Bank)

3.2 Generally Fast-Developing IT Industry

51

Fig. 3.6 Structure of global telecommunication income (Source Gartner, The World Bank)

Fig. 3.7 Number of global users of all systems and cellular M2M (2013–2018) (Source GSMA Intelligence)

The accelerated popularization of mobile Internet application has promoted the rapid growth of mobile traffic. According to statistics from communication supervision organizations of different countries, in 2017, ROK saw the highest monthly mobile traffic, which was 5.2 GB per month; then came the United States, whose traffic was about 3.9 GB per month. China’s mobile traffic was 2.8 GB per month, after developed countries like Japan and France. Monthly mobile traffic of major countries in 2017 is shown in Fig. 3.8.

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Fig. 3.8 Monthly mobile traffic of major countries (2017)

3.2.3 Rapid Development of Information Technology Service 1. Great momentum of cloud computing service According to a Gartner report, in 2017, the global market volume of cloud computing reached USD 260.2 billion, up 18.2% from the year 2016, with a high growth rate. In the past year, more and more businesses have been implementing the strategy of digitalized transformation, shifting their traditional IT service to cloud service. The global market volume of cloud computing from 2009 to 2020 is shown in Fig. 3.9.

Fig. 3.9 Global market volume of cloud computing (2009–2020) (Source Gartner, Forward-looking Industry Institute)

3.2 Generally Fast-Developing IT Industry

53

Fig. 3.10 Global cloud computing market structure (2017) (Source Gartner, Forward-looking Industry Institute)

In terms of market shares, IaaS is the fastest growing cloud computing service. In 2017, its revenue was USD 34.7 billion, up 36.6% from 2016; SaaS revenue saw an annual increase of 21.6%, amounting to USD 58.6 billion; PaaS revenue also increased, with a growth rate of 26.7%; and the revenue of cloud management and security service saw a growth rate of 22.5%, amounting to USD 8.7 billion. The global cloud computing market structure in 2017 is shown in Fig. 3.10. 2. Fast-developing data market With the rapid popularization of the Internet, IoT, and smart hardware, the global data market is growing explosively. A series of national strategies or policies on big data have been formulated, which has boosted the rapid development of the global data industry. According to statistics from Statista, the global big data market volume in 2017 was about USD 35 billion, up 25% from 2016. It is estimated that it will amount to USD 42 billion in 20182 . The global big data market volume and growth rate are shown in Fig. 3.11. 3. Increasing enthusiasm about mobile applications According to statistics released by App Annie, the year 2017 witnessed 175 billion downloads of APPs in the world, with the consumption volume amounting to USD 86 billion. Emerging markets were active in downloading, China, India, the United States, Brazil, and Russia being top 5. China witnessed over 80 billion downloads of APPs, up 125% on a year-on-year basis. In terms of consumption volume, China, 2 Source:

Statista Global Consumer Survey.

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Fig. 3.11 Global Big Data market volume and growth rate (2011–2027) (Source Statista Global Consumer Survey)

the United States, Japan, ROK, and the United Kingdom were top 5, with China’s consumption volume being over USD 33 billion. 4. Expenditure on online advertising surpassing that on TV advertising for the first time Data released by Magna shows that in 2017, the expenditure on online advertising across the world amounted to USD 209 billion, accounting for 41% of the total advertising expenditure. The expenditure on TV advertising amounted to USD 178 billion, accounting for 35%. It was the first time that the former surpassed the latter. According to Magna, the online advertising expenditure in 2018 will grow by 13%, amounting to USD 237 billion. According to Global Intelligence Report released by Zenith, 54% of China’s localized Internet advertising expenditure growth shares come from Baidu, Alibaba, and Tencent, while in other countries and regions, 96% of Internet advertising expenditure growth shares come from Google and Facebook.

3.2.4 Ecologicalized Competition Shaping Super-Businesses In the era of the digital economy, ecologicalized development is the universal choice of industrial leaders, who are building up their core competitiveness through basic technology R&D, for instance, in OS and chips, and expanding their business, developing value-added service, and enhancing interaction and cross-field cooperation through fast development and iterative innovation. Meanwhile, Internet businesses are making use of their user resources, data, technology to interact with individual users, financial institutions, governments, higher learning institutions, and other businesses and hence to form full-chain ecosystems.

3.3 Explosive Growth of Intelligent Manufacturing

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3.3 Explosive Growth of Intelligent Manufacturing 3.3.1 Increasing Scale of Intelligent Manufacturing The accelerated integration between the new-generation IT and traditional manufacturing facilitates the increase of the global intelligent manufacturing scale. According to statistics released by PAISI, global intelligent manufacturing market volume in 2017 amounted to USD1 456.8 billion, up 13.4% on a year-on-year basis. In the coming 3 years, it will witness a compound annual growth rate of about 10%. It is expected that it will reach two trillion U.S. dollars.

3.3.2 The United States, Japan and Germany Leading the Global Intelligent Manufacturing According to the Global Intelligent Manufacturing Development Index Report (2017) released by China Economic Information Service, in the 22 sample countries of 2017, the United States, Japan, and Germany belong to the first echelon, taking the lead in intelligent manufacturing; and the United Kingdom, ROK, China, Switzerland, Sweden, France, Finland, Canada, and Israel belong to the second, and they are advanced countries in terms of intelligent manufacturing. Among the top ten countries in intelligent manufacturing, seven are from Europe and America and three are from Asia. The United States, Germany, and Japan are committed to the development of intelligent manufacturing, focusing on the core position of CPS (Cyber-Physical System) technology in future industrial development. The United States is the leader in IaaS, expanding from the Internet to other businesses; Germany attaches importance to intelligent factories and smart digital production lines; and Japan is promoting intelligent manufacturing development by boosting the robot industry. Competition of global intelligent manufacturing markets is shown in Table 3.5. Some large businesses keep increasing their input in intelligent manufacturing. For instance, since 2013, Google has acquired the AI business DeepMind, the smart home business Nest, and 8 businesses of robots. Foxconn has launched the One Million Robots Program, according to which 7% of its workers will be replaced by automatic devices and robots.

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Table 3.5 Competition of global intelligent manufacturing markets Areas of intelligent manufacturing

Competition

Numerically controlled machine tools The United States, Japan, and Germany are the leaders in numerically controlled machine tool production and strength. EU’s production accounts for 40% of the world’s total, and their export accounts for 50 of the world’s total Industrial robots

Japan and Germany are leaders in industrial robot production, the former being capable of R&D of critical components (such as decelerators and servo motors) of industrial robots while the latter having some advantages in raw material, body components and system integration

Intelligent control systems

Of the top 50 businesses in the world, 74% are from the United States, Germany, and Japan, with the former two having the most, namely, 13. Japan has 11 of them, and then come the United Kingdom and Switzerland. Half of the top 10 are from the United States

Automatic instruments

The manufacturers are mostly in developed regions, including Europe, the United States, and Japan. The sensor market volume of the United States, Europe, and Asia (including Japan) accounts for 90% of the world’s total

3.3.3 Wide Application of Intelligent Devices Represented by Robots 1. Increasing industrial robot market volume With the deepening of AI technology application, increasing coordination between man and machine, and the improvement of robot application, the robot industry of the world is witnessing a new round of growth. According to statistics from China Commerce and Industry Institution, in the first half of 2018, the market volume of robots throughout the world reached USD 16.77 billion, higher than that of the whole year of 2017. From 2013 to 2017, the global industrial robot market volume kept increasing, with the annual compound growth rate of 16.1%. According to IFR, in 2017, the sales of global robots increased by 29% in comparison with that of 2016, amounting to 380,550, a new high in history. China witnessed the most rapid growth, with an increase of 58%, producing 138,000 robots; Japan produced 46,000 robots, witnessing an increase of 18%; ROK produced 40,000 robots, with a decrease of 4%; the United States produced 3,300 robots, with an increase of 6%; and Germany produced 2,200 robots, with an increase of 8%. The demand from the automobile industry is the major drive for the growth of the world’s robot sales. In 2017, the robot sales to the automobile industry increased by 21%, totally 125,200. Robot sales to the metal industry witnessed the highest growth rate,

3.3 Explosive Growth of Intelligent Manufacturing

57

which was 54%, totally 44,000 116,000 robots were sold to the electric/electronic industry, with an increase of 27%; and 10,000 robots were sold to the foodstuff industry, with an increase of 19%. 2. Increasing density of industrial robot application According to IFR, in 2016, the global robot application density reached 74.3 The density in Europe was 99, with an increase of 5%. The density in the American region was 84, with an increase of 7%; the density in Asia was 63, with an increase of 9%, ranking first in the world. Asia is the most active market. ROK is the country with the highest robot application density, every 10 thousand workers having 478 robots. Japan ranks second (314 robots every 10 thousand workers) and Germany ranks third (292 robots per ten thousand workers). The United States has a density of 164. According to China’s Robot Industry Analysis Report (2018), China had 88 robots per 10 thousand workers in 2017, witnessing an increase in comparison with the number in the past 2 years. The increase of robot application density shows that more and more countries are adopting automation to meet the demand of their manufacturing. 3. Fast development of 3D printing technology application According to a Forbes report, in 2017, the global 3D printing market value was USD 8.312 billion, which is expected to reach USD 35.36 billion in 2023. From 2018 to 2023, the annual compound growth rate will be 27.29%. The United States is the largest 3D printing market. In 2017, the country’s number of 3D printers in industry accounted for 43.8% of the global total, ranking first. Then came Japan, whose number accounted for 11.7%; and Germany ranked third, whose number accounted for 10.7%. The distribution of 3D printers in the industry across the world in 2017 is shown in Fig. 3.12.

3.3.4 Cultivation and Application of the Industrial Internet APPs In the era of intelligent manufacturing, industrial APPs are the key to competition. With the industrial Internet as the bond, and industrial knowledge and experience in them, they are APP software meeting special demand, so they are important achievements of industrial technology software. A number of businesses are establishing industrial ecosystems to build and use platforms and industrial APPs, so that they can accelerate the transformation and upgrading of manufacturing. It is expected that the total number of industrial APPs will reach 500,000. 3 The

industrial robot density refers to the number of industrial robots used by every 10 thousand workers.

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Fig. 3.12 Distribution of 3D printers in industry across the world (Source Forbes)

Traditional automation and software businesses are rewriting their software codes based on platforms, including SAP, PTC, and ORACLE. PTC has canceled the original authorized service but shifted all service to subscription based on platforms. GE has established four data centers in the world and deployed over 10 million sensors, which can collect over 50 million items of data. In addition, it has developed about 160 industrial APPs.

3.4 Rapidly Developing Global E-Commerce 3.4.1 Online Retail Boosting the Global Retail Market In 2017, the global online retail volume amounted to USD 2.304 trillion, up 24.8% from 2016, accounting for 10.2% of the global retail volume. In 2017, the global mobile online retail volume amounted to USD 1.37 trillion, accounting for nearly 60% of the total online retail volume. It is expected that the volume will account for over 70% in 2021. The global online retail volume and growth rate from 2012 to 2018 are shown in Fig. 3.13. Online retail is becoming mature, and competition is becoming stable in North America, West Europe, and East Asia. Since 2013 online retail in the United States

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Fig. 3.13 Global online retail volume and growth rate (2012–2018) (Source China International Electronic Commerce Center Research Institute)

has seen a reverse growth, traditional retailers playing an active role in online sale, and online and offline retail promoting the steady development of e-commerce of the country. Statistics show that in the year 2017, the online retail volume of the United States was USD 409.21 billion, up 13.6% from the year 2016. It is expected to keep a growth rate of 9.3% in the coming 5 years, and to amount to USD 638.05 billion in 2022. The online retail volume of the United States from 2016 to 2022 is shown in Fig. 3.14.

Fig. 3.14 Online retail volume of the United States (2016–2022) (Source Statista Global Consumer Survey)

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In Europe, the United Kingdom is the largest e-commerce market, whose sales volume accounts for 7.16% of GDP. According to Capgemini IMRG online retail index, the country’s online retail increased in the first half of 2018 by 16.8%, which had been the highest growth in the first half-year over the past 8 years, with an annual growth rate of 14.1% in the past 5 years. According to French E-commerce Market Research Report, in 2017, France witnessed an increase of 14.3% of its online retail, whose volume reached nearly 82 billion euros, which is expected to reach 92 billion euros in 2018. According to a PostNord report, the first half of 2018 witnessed the online retail volume of over 10 billion euros in North Europe, up 13% on a year-on-year basis.

3.4.2 Major Drive in Emerging Markets Emerging markets, including Asia, Latin America, the Middle East, and Africa, are becoming the new drive of global e-commerce development. Asia and Oceania have the largest number of online shoppers. Global E-commerce Report 2017 shows that in 2018, 1.6 billion people will shop online at least once, accounting for over 50% of Internet users. Of the shoppers, nearly 50% are from the Asia-Pacific countries, the number ranking first. The number of online shoppers in 2013 and 2018 is shown in Fig. 3.15. As for the market volume, Asia and Oceania saw 28% of global B2C e-commerce sales, with one-third of international small parcel posts. China remains the largest e-commerce market of the world. In 2017, the transaction volume of the country amounted to USD 29.2 trillion, up 11.7% on a year-on-year basis. China’s B2C sales and number of online shoppers both rank first. In recent 5 years, online sales in Latin Fig. 3.15 Number global online shoppers (2013–2018) (Unit: million people) (Source Global E-commerce Report 2017)

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America have been growing at a two-digit rate, with USD 44.55 billion of online retail volume in 2017. The number of online shoppers there accounts for 10% of the global total. In the whole region, Brazil is a leader in e-commerce, with its B2C sales volume accounting for 38% of the total of the region. B2C sales volume of Mexico and Argentina accounts for 19% and 8% respectively in that region.

3.4.3 Thriving Global Cross-Border e-Commerce As an important part of digital trade, e-commerce is playing an increasing role in the global trade system, and new business and model represented by crossborder commerce is becoming the new drive for foreign trade development. Global Cross-border B2C E-commerce Market Outlook Report released by AliResearch and Accenture shows that in recent years, the annual growth rate of cross-border B2C e-commerce is 27%. It is estimated such B2C e-commerce volume will amount to over one trillion U.S. dollars, with a compound annual growth rate of 20%, and that the number of consumers in that area will be over 900 million, with an annual growth rate of over 20%. North America, China, and Europe are regions developed in cross-border commerce. eBay and Amazon from the United States are doing such business throughout the world. By September 2018, Amazon Business had been serving millions of businesses and other organizations across the world. Its revenue in 2018 is expected to be USD10 billion, with the sales volume of third-party sellers accounting for over 50%. Adhering to the principle of openness, sharing, cooperation, and win-win, China is committed to e-commerce development. China’s E-commerce Report 2017 shows that the import/export volume of cross-border e-commerce through China Customs was 90.24 billion yuan in 2017, up 80.6% on a year-on-year basis. Of the volume, export volume amounted to 33.65 billion yuan and import volume to 56.59 billion yuan, up 41.3% and 120%, respectively. According to Forrester, driven by the market of China, the import and export of the Asia-Pacific Region will be the largest crossborder e-commerce market. The international retail of China’s e-commerce businesses is growing rapidly. By March 2018, the online retail of Alibaba had covered 220 countries and regions, with 8,300 active overseas buyers. In the first quarter of 2018, its international retail income amounted to 4,316 million yuan, up 64% from the year 2016. Joybuy of JD.com was launched in 2017, and hence users from over 200 countries and regions can buy what they like on JD.com. June 18 has become a festival for global consumers. In Europe, over 50% of online retailers are doing cross-border business. In the first half of 2018, about one-third of e-commerce consumers in North Europe had the experience of cross-border online shopping. 29% of them say that they will do that again. Finland sees the largest percent, namely, 40% of such consumers.

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3.5 Digital Technology Leading the Transformation of the Service Industry The in-depth integration between digital technology and service industry facilitates the development of new business and new modes including sharing economy, Internet medical care, online education, and online tourism. Service outsourcing and intelligent logistics are being digitalized at a high speed.

3.5.1 Thriving Sharing Economy 1. Global sharing economy development In the world, sharing economy has been expanded, from traditional areas like automobile and accommodation to express, logistics, human resources, finance, mechanics, agriculture, and medical care, having gained popularity among consumers. According to a survey by HAVAS Worldwide in 29 countries, 28% of the population is involved in sharing economy. The United States is the origin of sharing economy and more and more people there have experienced it. A survey made by Allianz Global Assistance in the first half of 2018 shows that in that country, 47% people wish to use sharing economy service, and 19% of the respondents say that they will use that service. The number of sharing economy platform users has decreased by seven percent. Since 2017, people’s trust in sharing economy has decreased from 65 to 62%. The Business School of Warwick University of the United Kingdom released Sharing Economy Consumer Survey Report: Who Shares and Who Doesn’t, which shows that in the previous 18 months, the number of sharing economy platform users in the United Kingdom increased by 60%; nearly 23% of the interviewees use the platform over once a month; and 73% of them use more than one platform for sharing economy service. Secondhand commodity selling is the most popular sharing economy service for British consumers, with 47% of the respondents using relevant websites. The use rate of sharing accommodation, sharing autos, and crowdsourcing service is high. According to PWC, in 2017, Germany’s sharing economy market volume was over 20 billion euros. In that year, 39% of Germans used sharing economy service and 40% said that would do that in 2018. 23% of respondents experienced sharing media service, 20% experienced consumer product sharing and 17% experienced sharing accommodation. According to PWC, the sharing economy volume of Germany will be over 24 billion euros in 2018. According to Japanese Sharing Economy Association, Japan’s sharing economy market volume in 2017 was 266 billion yen. Uber financial statistics show that the company’s net revenue after adjustment saw a year-on-year increase of 61% in the fourth quarter of 2017, a gross revenue increase to USD 11 billion, up 61% from the year 2016. Airbnb saw an increase of about 50% in its order in 2017.

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2. Great potential of emerging markets China, India, and Brazil and other emerging markets have a large population and a large number of Internet users, so they have a strong demand for sharing economy. Statistics show that China’s sharing economy market volume was about 4.92 trillion yuan in 2017, up 47.2% on a year-on-year basis; over 700 million people were involved in sharing economy, 100 million more than the number in 2016; about 70 million people provided relevant service, 10 million more than the number in 2016. In India, local businesses in sharing economy are emerging. Shareconomy connects entrepreneurs, micro-business owners, and those who have just started up their business. Entrepreneurs can release their idle resource information, and the latter two can choose what they need. Statistics from SPC Brasil and CNDL in Brazil show that 40% of Brazilian consumers have used shared economy service in 2018. In that country, 89% of consumers believe that sharing economy is playing an increasingly important role in their life and 68% believe that in the coming two years this new consumption mode will be closely related to their daily life. By March 2018, 99 taxies, the largest mobile transportation provider of Brazil, had begun services in over 160 cities of that country, at a price about 15% lower than that offered by its counterparts. It saw a quarter-to-quarter increase of 250% in its service in the first quarter of 2018.

3.5.2 Deep Integration Between Digital Technology and Livelihood Service 1. Progress in Internet medical care Some countries and regions have begun to look for practical medical care modes from different dimensions, such as policies, technology, and market. Internet medical care is gaining more and more attention. For instance, the United States have passed an act on Internet medical care, and abolished the regulations forbidding preliminary diagnosis in Internet medical care, so that Teladoc, AmericanWell, Doctor on Demand, and MD Live can expand their long-distance Internet video business to the whole American market. According to HIS InMedica, in 2018, there will be over 1.2 million Internet medical care users throughout the United States. According to China Internet Development Report 2018 released by Internet Society of China, in July 2018, the number of Internet medical care users in China will be 253 million, with an annual growth of 29.7%, and the Internet user rate of 32.7%. New technologies like big data, cloud computing, AI, wearables, VR, and AR will be used in Internet medical care. Online and offline integration will be deepened in that area. Health and medical care APPs with the capability of offline medical resource integration have more advantages. Internet medical care businesses will accumulate mega or ten-million-level data, which will facilitate the improvement of medical care service in return.

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2. Online education platforms as a new trend MOOC has seen great progress throughout the world. The United States, China, India, Mexico, Thailand, and Italy have launched their special MOOC platforms. By the end of 2017, over 800 universities have launched at least one MOOC. According to Class Central, an American MOOC navigation website, in 2017, there were 78 million MOOC learners, 94 million courses, over 500 kinds of certificates, and over 10 online postgraduate degrees.4 According to data released by the Ministry of Education of China, by January of 2018, the country had launched 490 National Quality Online Open Courses, over 5,000 MOOC courses, over 70 million learners, and 11 million college students who had got MOOC credits. Online education platforms are being deployed across the world. For instance, VIPKID, which was set up in 2013, became a unicorn within only 5 years. On this platform, there are over 60,000 teachers from North America, mainly from the middle and east of the United States, where there are prestigious universities. It is estimated that by the end of 2018, there will be over 100,000 foreign teachers on that platform. Among them, the number of those who have over 5 years of teaching experience accounts for 70%, and the number of those who have a master’s degree or above accounts for over 30%. 3. Rapidly developing online tourist market Maturing online travel agencies in the world are changing the tourist industry. Good experience and low price provided by online tourist software are attracting more and more consumers. According to eMarketer data, in 2018, the sales of global digital tourism amounted to USD 694.41 billion, up 10.4% from the previous year. China has witnessed the most obvious shift from offline tourism to online tourism. In 2018, the country’s digital tourist sales amounted USD133.9 billion, up 20.5% from the previous year. India is another major market. According to eMarketer, in 2018, the country’s digital tourist sales increased to USD 23.71 billion, up 20%. 4. Dramatically increasing paid OTT market volume Paid content is an important growth point in digital economy, only after advertising and e-commerce. Video subscriptions, short video, and live online streaming develop fast. According to eMarketer, in 2018, nearly 765 million people of the world enjoyed OTT, accounting for 10.2% of the global population, and 32.1% of the global online video audience. The OTT market volume will increase by 24%. OTT of the United States is mainly in the form of advertising, such as OTT of YouTube for user video sharing and that of Netflix only open to users. The latter’s OTT market volume accounts for 44% of the global total, and the number of its users accounts for 44.4% of that of American total. According to a report by Ofcom, a UK media supervision organization, by the first half of 2018, three major media businesses, namely, Netflix, NOWTV (Sky), and Amazon Prime had over 15.4 million subscriptions, over the number of paid TV subscriptions. 4 http://www.ict.edu.cn/html/lzmwy/mooc/n20180326_49156.shtml.

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In the United States, the biggest short video platforms are Facebook, Twitter, and Instagram, which are more social than their Chinese counterparts, such as Douyin and Kuaishou. Acquaintances tend to share their videos on those platforms in the United States. Short video platforms like musical.ly and Vigo in that country belong to ByteDance. Recreational live streaming emerged later in the United States. Facebook and Twitter have launched their live streaming, which, however, is an auxiliary function of their social function. In the recreational live streaming, membership/paid subscription is more popular while tipped live streaming is not so popular. The most popular tipped platforms are LiveMe, Live.ly, and BIGO LIVE, which are operated by Chinese teams, who are, respectively, from NYSE:CMCM, musical.ly, and YY. In comparison, tipped live streaming emerged early in China.

3.5.3 Accelerated Digitalization of Productive Service Industry 1. Digital technology accelerating service outsourcing Digital economy is inseparable from service outsourcing. According to an IDC survey, in 2017, among the top 1,000 businesses in the world, 67% of them took digitalization as their strategy. Research by Forrester shows that from 2016 to 2018, digital service has maintained a growth rate of 20%, and that global service outsourcing will develop rapidly. According to IDC, by 2020, the demand for service outsourcing across the world will reach USD 1.8 trillion. 2. Remarkable achievements made in intelligent logistics The dramatic development of e-commerce, cross-border e-commerce, in particular, has promoted the intelligent transformation of logistics. According to data from JD.com, in 2017, the company had a logistics revenue of nearly 30 billion yuan, and in the coming 5 years, the figure is expected to reach over 100 billion yuan. It is facilitating the R&D and application of non-keeper storehouses, non-driver vehicles, and non-pilot aerial vehicles by utilizing intelligence technology, having formed completely automatic intelligent storage and transportation and a set of systematic logistic solutions, which has enabled storage efficiency to improve by ten times, and the transferring and sorting efficiency by five to six times. Cai Niao spent 5 years setting up a global intelligent logistic network covering over 80 partners and 231 cross-border logistic storehouses in 224 countries and regions. They can deliver expresses to countries like Spain, the Netherlands, France, and Southeast Asian countries within 72 h. Alibaba’s financial report shows that in the first three quarters of 2017, Cai Niao Logistics had its revenue of 3.9 billion yuan. In the first half of 2018, the company opened two regular intercontinental airlines, namely, Hangzhou

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Fig. 3.16 Global Fintech popularization rate (2017) (Source EY Fintech Adoption Index 2017)

to Moscow, and Hong Kong to Belgium, the only two e-commercial intercontinental airlines of the world.

3.6 Rapid Development of Fintech 3.6.1 Trend of Global Fintech According to a report by EY on global fintech popularization, in 2017, the average popularization rate was 33% (see Fig. 3.16), while it was only 16% in 2015. The top three countries were China (69%), India (52%), and the United Kingdom (42%). The popularization rate of Brazil, China, India, Mexico, and South Africa was 46%, higher than the average level of the world. According to Celent, in 2017, the market volume of the U.S. fintech reached USD 35 billion, with the ratio of the capital in banking, insurance, and securities industry as 55:30:15. The expenditure of banking was about USD 19.9 billion, with an annual growth rate of about 8%.

3.6.2 Deployment of Major Countries and Regions In 2017, many governments and supervision institutions from the United States, the United Kingdom, Australia, Singapore, and India launched policies and regulations in line with their local fintech development features. U.S. National Economic Council

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has issued the white paper Fintech Supervision Framework, which proposes that policies should be made from the perspective of facilitating fintech and that competitive strengths should be pursued in financial innovation. HM Treasury of the United Kingdom proposes the strategy of Fintech Revitalization, according to which taxation preference is adopted for innovation businesses of fintech. Monetary Authority of Singapore (MAS) has signed bilateral agreements with Malaysia, Thailand, and the Philippines on cooperation in fintech infrastructure construction and innovation center establishment. A fund of 27 million Singapore dollars was launched to promote AI and data analysis development in fintech. The Indian government encourages digitalization and entrepreneurship, and improves the economic and business environment to promote the popularization of fintech. In general, all countries and regions are active in developing fintech, which has led to a new high in funding of that field. KPMG data shows that in the first half of 2018, the investment in fintech amounted to USD 57.9 billion, covering 875 transactions. The U.S. fintech businesses obtained an investment of USD 14.2 billion, in which over 5 billion belonged to risk investment; European businesses obtained an investment of USD 26 billion, covering 198 transactions; Asian businesses obtained USD 16.8 billion, covering 163 transactions. In the first half of 2018, among the top ten funding projects of fintech, Ant Financial raised a fund of USD 14 billion, ranking first as is seen in Table 3.6. Table 3.6 Top ten funding projects of Fintech in the first half of 2018 (Source Pulse of Fintech 2018. Global analysis of investment in fintech, KPMG International (data provided by Pitc) hBook9 July, 2018) Ranking

Business

Amount (USD0.1 billion)

Country

Event

1

Ant Financial

140

China

C-round financing

2

WorldPay

129

The United Kingdom

Merger

3

Nets

55

Denmark

Acquisition

4

Blackhawk Network Holdings

35

The United States

Acquisition

5

iZettle

22

Sweden

Merger

6

IRIS Software Group 18

The United Kingdom

Acquisition

7

PowerPlan

11

The United States

Merger

8

Cayan

10.5

THE United States

Acquisition

8

OpenLink Financial

10

The United States

Acquisition

9

Nordax Group

7.88

Sweden

Acquisition

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3.6.3 Rapid Development of Lending and Payment Over the past years of development, global fintech has seen the establishment of a comprehensive and diversified service system covering P2P online lending, crowdfunding, third-party payment, and Internet money management, and the emergence of a number of unicorn businesses. In 2017, lending and payment witnessed more rapid development in various areas. With the rapid popularization of the Internet, emerging technologies, and mobile terminal devices, the global online payment has been developing rapidly. Banque Nationale de Paris predicts in World Payment Report 2017 that from 2017 to 2020, the global digital payment transaction will grow by 10.9% every year. The number of transactions will be 726 billion in 2020. According to statistics, 50% of consumers of the world make account transfer and payment through fintech, 64% of fintech users prefer to manage their daily life through the Internet, and 38% of non-fintech users prefer to do that. In 2017, in the financing field there were 134 financing cases, involving 34.4 billion yuan. In the payment field, there were 93 financing cases, involving 26.5 billion yuan. Among the 93 financing cases, 17, 16, and 15 were from China, the United States, and India, respectively, who are the top three countries. Payment and online lending are two major mature fields in China, involving micro and small business owners, part-time entrepreneurs, college students participating in vocational training and poor people from rural areas. India is the second-largest online lending market in Asia, coming after China. Different from the United States and the United Kingdom, the country has a weak credit system, so the rapid development of its online lending market benefits from technologies like big data analysis. The market is oriented to small and medium-sized businesses and long-tail customers. In the past 2 years, India’s online lending businesses have seen growth spurt. Only in 2017, as many as 225 such businesses were set up5 in India. In October 2017, KrazyBee, an online petty loan platform, completed its A-round financing of USD eight million. With the popularization of the Internet and smartphones as well as the formation of online payment habits, India, a later comer, will see a broad prospect in online payment. In general, fintech development has accelerated the inclusiveness of finance. It provides convenience for small and medium-sized businesses and entrepreneurs in India, Southeast Asia, and Africa, where traditional financial service cannot meet the market demand.

5 http://www.dongwucaijing.com/wap/article/article_548.html.

Overseas Fintech Development and Prospect in 2018.

Dongwu Research, Domestic and

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3.7 New Trend of Global Investment Brought About by Digital Economy Rapidly developing digital economy is the pursuit of global capital. Investment in telecommunication, semiconductor, and e-commerce is stable, while investment or financing in Internet transportation and digital health is active, promoting the market value of relevant businesses.

3.7.1 Stable Percentage of Investment in Telecommunication Statistics from Gartner and the World Bank show that in 2017, the global investment in telecommunication was about USD 271.1 billion, accounting for 17.05% of the global telecommunication service. It has remained stable for 3 years. The global telecommunication service volume and the percentage of investment in telecommunication from 2013 to 2018 are shown in Fig. 3.17.

3.7.2 Substantial Growth of the Semiconductor Market Global sales pickup has promoted the capital expenditure of the semiconductor industry. According to IC Insights, in 2018, the total expenditure of semiconductor capital across the world will increase to USD 102 billion, with an increase of 9%

Fig. 3.17 Global telecommunication service volume and percentage of investment in telecommunication (2013–2018) (Source Gartner and the World Bank)

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Fig. 3.18 Total semiconductor capital expenditure of the world (2013–2018) (Source IDC)

from USD 93.3 billion in 2017, and an increase of 38% in comparison with that in 2016. Total semiconductor capital expenditure of the world from 2013 to 2018 is shown in Fig. 3.18. In terms of investment structure, investment in storage devices like DRAM and flash memory has reached USD 54 billion, accounting for 53% of the total semiconductor capital expenditure, a double of the figure in 2013, which was 27%. From 2013 to 2018, the compound annual growth rate was 30%. In 2018, investment has been made in the upgrading of existing fabrication plant lines and completely new manufacturing facilities.

3.7.3 Active Investment in e-Commerce According to World E-commerce Report 2017, the total investment in e-commerce of the world in 2017 was expected to be over USD 20 billion, up 103.9% from 2016. In that year, there were 941 contract projects of investment and financing, 145 more than those in 2016. China, the United States, and India are the largest markets of e-commerce, with their investment in that area accounting, respectively, 30, 24 and 17%. Meanwhile, seed/angel financing in e-commerce begins to see a drop in times, decreasing from 54% in 2013 to 38% in 2017. There is an increasing investment in later-phase projects, and the global e-commerce is maturing. Annual investment and financing in e-commerce of the world from 2013 to 2017 is shown in Fig. 3.19.

3.7 New Trend of Global Investment Brought About by Digital Economy

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Fig. 3.19 Annual investment and financing in E-commerce of the world (2013–2017) (Source CB Insights)

3.7.4 Active Investment and Financing in Internet Transportation Facilitated by online car-hailing and automatic driving, investment/financing in Internet transportation has become active. According to data from Bloomberg, in 2017, the global online car-hailing saw an investment of USD 28 billion. Only in the fourth quarter of 2017, Uber and Didi got the venture investment of over USD 15.5 billion6 . Softbank of Japan is the most active investor in online car hailing. By the end of 2017, it had invested USD 9 billion in Uber, acquiring 15% of the company’s stock equity. In 2018, the investment in online car hailing remained active. Google has invested in Go-Jek, an Indonesian service provider, and BMW has acquired DriveNow, a European taxi business, and become the latter’s wholly owned parent company. In July 2018, Softbank and China’s Didi Chuxing established a joint venture, which will provide online car-haling service in Osaka of Japan and then the service will be expanded to Kyoto and Tokyo. Softbank has also invested in Grab and Cruise, with the investment covering online car hailing, automatic driving, and maps. Its investment distribution in transportation is shown in Table 3.7.

6 Source:

Bloomberg New Energy Finance Report.

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Table 3.7 Softbank’s investment distribution in transportation Corporation

Major business

Round of investment

Investment amount (0.1 billion US dollars)

Investment time

SB Drive

Automatic driving

–

–

03-24-2017

Didi Chuxing

Online car-hailing

F-round leading

10

09-08-2015

G-round following

55

04-28-2017

H-round leading

40

12-21-2017

Uber

Online car-hailing

Secondary market

70

12-28-2017

Ola

Online car-hailing

D-round leading

2.1

10-27-2014

F-round following

2.25

11-18-2015

H-round leading

3.3

02-27-2017

I-round leading

2.5

04-13-2017

J-round leading

11

10-02-2017

D-round leading

2.5

12-04-2014

F-round following

7.5

09-20-2016

G-round leading

20

07-24-2017

D-round leading

6

12-31-2014

Grab

Kuaidi

Online car-hailing

Online car-hailing

99

Online car-hailing

Private

1

05-24-2017

GM Cruise

Driverless driving

–

22.5

05-31-2018

Mapbox

High-precision map C-round leading

1.64

10-10-2017

NAUTO

Automatic driving

C-round leading

1.59

07-19-2017

Advanced Smart Mobility

Automatic driving

Seed

0.0441

03-29-2016

Auto 1 Group

Second-hand car trading

Private

0.561

01-15-2018

DOIT

Freight logistics

–

19

04-24-2018

3.7 New Trend of Global Investment Brought About by Digital Economy

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3.7.5 Increasing Amount and Price of Digital Health Financing According to data from Startup Health, in the first half of 2018, there were 414 financing transactions in digital health financing, witnessing an increase of about 20% from the number in 2017. Patient enablement businesses obtained the most investment. In the first half of 2018, six out of the eight most active head investment institutions invested in that area. Among the top 10 businesses receiving finance, three are headquartered in cities outside the United States, namely, Toronto, London, and Hangzhou of Zhejiang. In the same period, seed-round and A-round investments were dominant investment forms. B-round financing witnessed a dramatic increase. C- and D-round financing witnessed the largest amount, breaking the record by USD 6.0 billion. Despite their decrease in percentage, seed and A-round financing had witnessed decreased intervals. Statistics show that China boasts great potential in the digital health market, with the financing volume in Beijing exceeding the total of all U.S. cities. The scale of China will see further increase as more large businesses invest in digital health.

3.7.6 New High in Assessed Value of Businesses Active financing in digital economy has led to a new high in assessed value of businesses. Among the top 20 Internet businesses, 11 are from the United States and 9 from China, with their total market value exceeding USD 5.78 trillion. Among the top ten, seven are from the United States, and three from China. Top five are all from the United States. Top 20 Internet businesses’ market value in 2018 is shown in Table 3.8.

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Table 3.8 Top 20 internet businesses’ market value (2018) (Source CB Insights) Ranking

Business

Country

Market value (0.1 billion U.S. dollars) May 29, 2013

May 29, 2018

1

Apple

The United States

418

9,240

2

Amazon

The United States

121

7,830

3

Microsoft

The United States

291

7,530

4

Google

The United States

288

7,390

5

Facebook

The United States

56

5,380

6

Alibaba

China

–

5,090

7

Tencent

China

71

4,830

8

Netflix

The United States

13

1,520

9

Ant Financial

China

–

1,500

10

eBay+PayPal

The United States

71

1,330

11

BookIng

The United States

41

1,000

12

Salesforce

The United States

25

940

13

Baidu

China

34

840

14

Mi

China

–

750

15

Uber

The United States

–

720

16

Didi Chuxing

China

–

560

17

JD

Chian

–

520

18

Airbnb

The United States

–

310

19

Meituan

China

–

300

20

Toutiao

China

–

Total

1429

200 57,780

Chapter 4

Opening-Up of Global Government Data

4.1 Overview With the advent of the big data era, data is the foundation and strategic resource for economic growth and social progress. Opening up of government data contributes to the improvement of governmental transparency and governance capability, and of market vitality. It also contributes to industrial development and improvement of the public’s right to know and their sense of happiness. There is an increasing demand for the opening-up of government data. The focus of countries on e-government has been shifted to the expectation of government data opening-up. (1) All countries are opening up their government data. Rudiment, expansion, and development have been the periods of the opening up of government data. An increasing number of governments are implementing relevant policies, and the value of open data is being explored. Developed countries are taking the lead in government data opening-up, while developing ones are latecomers in that respect, but they are witnessing a rapid development. (2) All governments are deepening their data opening-up. The number of opened data sets keeps increasing and the scope keeps expanding. The percentage of machine-readable open data is increasing. Platforms of government data opening-up have improved functions, guarantee measures are systematized and there have emerged more and more APPs related to opened-up data. (3) Opening-up of government data is faced with more opportunities and challenges. Opened-up data has contributed to the improvement of governance capacity and industrial vitality. Quality and value of opened data is the concern of the public, so it is an issue that should not be ignored to close the digital gap. Privacy and cybersecurity require technical and legal guarantee and global cooperation.

© Springer Nature Singapore Pte Ltd. 2020 World Internet Development Report 2018, https://doi.org/10.1007/978-981-15-4067-7_4

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4.2 History of Opening-Up of Government Data 4.2.1 Rudiment Period of Opening-Up of Government Data In January 2009, the Obama administration signed Memorandum on Transparency and Open Government and Memorandum on the Freedom of Information. In May that year, data.gov was officially launched, and from it, the public can freely search for and obtain data of the federal government. In December that year, the U.S. government put The Open Government Directive into effect, containing three principles for open government, namely, transparency, participation, and coordination. The document proposed that more data would be published on the website, which symbolized the official opening up of government data. In June 2009, the UK government initiated its “making data real” program.

4.2.2 Extensive Stage of Government Data Opening Up 1. Different governments’ strategies on data opening up In November 2010, the European Commission was the first to propose the “open data strategy”. In April 2012, the Canadian Government issued the Three-year Open Data Initiative, which covers data collection, data and platform standard establishment, and opening up of new portal websites. In 2012, China issued the Plan of National Governmental Information Projects in the Twelfth Five-year-plan Period, which proposed four tasks, namely, construction of the national e-government networks, deepened development and utilization of basic national information resources, improvement of national cyber and information security infrastructure, and building of key national information systems. 2. Improving laws and regulations on data opening up During their data opening up, all governments are improving their laws and regulations that issue. In May 2010, Australia’s Federal Parliament passed the Freedom of Information Amendment (Reform) Act 2010, which gives more freedom to the government in disclosing and publishing information. In 2012, the U.S. government formulated and issued Consumer Data Privacy Protection Act, which proposed the protection of personal privacy and information in cyberspace. 3. Accelerated construction of open data platforms Governments and organizations of many countries and regions are accelerating the construction of open data platforms to speed up government data opening up. In January 2010, the UK government launched its data opening up website named data. gov.uk. In March 2011, the Canadian government’s portal website for data opening

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up was established. In 2012, India launched data.gov.in, which is the data opening up platform of that country. In the same year, in Shanghai of China, the first governmental open data platform on the Chinese Mainland was launched.

4.2.3 Development Period of Opening-Up of Government Data 1. Upgrading and optimization of open government data platforms At the end of 2014, the Canadian government upgraded its portal website, and established its comprehensive open portal website and professional open data portal website. In 2016, they emphasized in Open Government Partnership: national action plan 2016–2018 that they would revise their open data portal website. By September 2018, 46 local governments of China had launched their open data platforms and a central platform of the country will have been built by the end of 2018. 2. Expanding the scope of open government data The U.S. government data covers local governmental affairs, climate, environment, agriculture, education, energy, finance, law, housing, commerce, trade, employment, and taxation, data of which is opened to the public. The Canadian government data covers economy, population, geography, culture, information communication, and agriculture. The Japanese open data covers 22 central organizations and 17 categories. In China, 46 open local government data sets cover fiscal status, finance, urban and rural construction, science and technology, and education, which fall into 22 categories. 3. Increasing number of open data bodies Countries with open data include developed countries like the United States, France, Austria, and Spain and developing countries like China, India, Brazil, Argentina, Ghana, and Kenya. EU, OECD, the UN, and the World Bank have also opened their data. Open Data Barometer (4th edition) released in 2017 covered 115 countries and regions, with the number having increased by 25 and 33% in comparison with that covered in the third and first edition, respectively. The data opening index of the United States, the United Kingdom, France, Canada, and New Zealand is at the top. 4. Innovative forms and ways of data Opening All countries are innovating the forms and ways of data opening up. On data portal websites of the United States, the United Kingdom, and Australia, users can submit data sets and request for data application, and make comments on service. These portals can share information with YouTube, Facebook and Twitter, and other social networks. Provincial and other local governments in China have put their open data

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Fig. 4.1 Number of open data bodies

on portal websites, which are connected with social software like WeChat, QQ, and Weibo, so that open data can be spread to the social life of the public.

4.3 Status Quo of Opening-Up of Global Government Data 4.3.1 Increasingly Open Government Data An analysis1 (see Fig. 4.1) of the Open Data Barometer shows that the number of countries and regions involved in the assessment keeps increasing. In 2013, there were 77 of them; in 2015, 86, in 2016, 92, and in 2017, 115. By September 2018, among the top three countries in terms of the number of open data sets, the United States had opened up 302, 944 data sets; India, 213, 698; and Canada, 81, 003. The number keeps increasing, with that of the United States, the United Kingdom, and Australia increasing the fastest, up 56% from 2017 to 2018. The top ten countries in the number of data sets are shown in Fig. 4.2, and the increase in the number of data sets from 2016 to 2018 is shown in Fig. 4.3. More and more open data can be read by the machine. The percentage of machinereadable data of maps, land, statistics, budget, expenditure, corporations, legislation, transportation, trade, health, education, crime, environment, election, and contracts that can be read by the machine increased from 37% in 2013 to 75% in 2018, as is shown in Fig. 4.4.

1 Internet

Development Foundation has released five editions of Open Data Barometer from 2013 to 2018. The fifth edition covers 30 countries. https://opendatabarometer.org/?_year=2017&indica tor=ODB.

4.3 Status Quo of Opening-Up of Global Government Data

Fig. 4.2 Top ten countries in the number of data sets

Fig. 4.3 Increase of the number of data Sets (2016–2018)

Fig. 4.4 Percentage of machine-readable open data

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4.3.2 Improving Open Government Data Platforms 1. Open government data platform of the United States The open government data platform of the United States covers most data produced and generated by the federal government. It is an integrated website that opens up databases to citizens, businesses, and research staff, as is shown in Fig. 4.5. For

Fig. 4.5 Homepage of the Open Data Platform of the U.S. government

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the users’ convenience, the federal government requires that the website not only publish original data, but also provide tools for data analysis and format transfer, so that the data and developers’ software can be operated together and the data can be opened up and utilized efficiently. Businesses are encouraged to develop APPs of characteristics based on the data. Take geographical information as an example. The website data.gov provides standard APP interfaces, so that APP developers can draw geographical data to develop visualized geographical information service. 2. Open government data platforms of China The construction of the open government data platforms of China is being accelerated. By September 2018, the country had 46 such platforms, including 15 provincial and 31 prefectural or municipal ones, which are of the basic characteristics of open government data platforms and are the pioneers of their kind. Some open local government data platforms of China are shown in Table 4.1. 3. Open government data platforms of Australia By September 2018, there were 30,260 open data sets on the open government data platform (see Fig. 4.6) of Australia, with the download formats like SHP, CSV, WMS, WFS, PDF, and XLS, which can be read by the machine. The platform provides data request, data analysis, application cases, and map service, which can help users to obtain and use data efficiently. It also provides 42 APPs for data opening up to help users to develop and use data.

4.3.3 Imbalanced Development of Global Government Data Opening-Up 1. Development in different regions of the world The comparative analysis of the open government data indices of different regions from 2013 to 2017 shows that North America ranks first, with high-level development; Europe, Middle Asia, East Asia, and the Pacific Region rank second, with comparatively high-level development; and Latin America and the Caribbean, the Middle East and North Africa, and sub-Saharan Africa ranks third, with low-level development. Open government data indices of different regions in the Open Data Barometer is shown in Fig. 4.7. 2. Development in G20 countries The comparative analysis (see Fig. 4.8) of the open government data indices of G20 countries from 2013 to 2017 shows that the United States, the pioneer in data opening-up, has seen a year-by-year decrease of scoring of data opening-up in recent

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Table 4.1 Some open local government data platforms of China No.

Platform name

Location

Level

Domain name

1

Beijing Government data Resource Website

Beijing

Provincial

http://www.bjdata.gov .cn/

2

Open Guangdong

Guangdong

Provincial

http://www.gddata.gov .cn/

3

Open Guizhou Government Data Platform

Guizhou

Provincial

http://www.gzdata.gov .cn/

4

Open Jiangxi Government data Website

Jiangxi

Provincial

http://data.jiangxi.gov .cn/

5

Open Ningxia

Ningxia

Provincial

http://ningxiadata.gov .cn/

6

Open Shandong Data Shandong Website

Provincial

http://data.sd.gov .cn/

7

Shanghai Data Service Website

Shanghai

Provincial

http://www.datashang hai.gov .cn/

8

Zhejiang Governmental Service Website

Zhejiang

Provincial

http://data.zjzwfw.gov .cn/

9

Central Open Data Platform of Guangzhou Government

Guangzhou, Guangdong

Vice-Provincial

http://www.datagz.gov .cn/

10

Open Shenzhen Government Data Platform

Shenzhen, Guangdong

Vice-Provincial

http://opendata.sz.gov .cn/

11

Open Harbin Data

Harbin, Heilongjiang

Vice-Provincial

http://data.harbin.gov.cn

12

Open Wuhan Government Data Service Website

Wuhan, Hubei

Vice-Provincial

http://www.wuhandata. gov.cn

13

Open Jinan Data Website

Jinan, Shandong

Vice-Provincial

http://www.jndata. gov.cn

years, but it remains one of the top countries in open data volume and that Saudi Arabia has seen an increase of data opening-up in recent years. ROK, Mexico, Italy, and Canada have seen unsteady scoring in that aspect, but in general, they have seen an increase. China is fast in opening up data, with the index having increased from 20 in 2017 to 31 in 2018.

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Fig. 4.6 Homepage of the open data platform of the Australian government

Fig. 4.7 Open government data indices of different regions in open data barometer

3. Development in Belt & Road countries The average score of open data indices of 65 countries along the “Belt & Road” is 24–26, with the highest at only 58 (see Fig. 4.9). The scores are generally low, with low growth speed. As the initiator of the Belt & Road Initiative, China was a later comer in data opening-up, but it has seen rapid development in that respect.

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Fig. 4.8 Open government data indices of G20 countries in open data barometer

Fig. 4.9 Open government data indices of the “Belt & Road” countries in open data barometer

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4.3.4 Improving Guarantee Measures for Open Data 1. Formulation of complete data opening-up policies In May 2017, American President Trump signed his executive order Strengthening the Cybersecurity of Federal Networks and Critical Infrastructure. In September 2018, the U.S. Department of Defense issued the National Cyber Strategy of the United States, which has looser provisions for nation protection with digital weapons, and allows the military side to cooperate with other institutions. In 2016, the United Kingdom issued Local Governments’ Transparent Action Standards 2015, and later Open Government Partnership: UK national action plan 2016—2018. China released in 2017 Implementation Plan for Governmental Information System Integration and Sharing, and in 2018 Notice of Issuing Scientific Data Regulations by the General Office of the State Council and Notice of Deepening the Reform Implementation Plan for One Website, One Gate, and One Time of “Internet + Governmental Service”. The policies are being improved, which has facilitated the opening-up of government data. 2. Acceleration of the establishment of data opening-up institutions The U.S. government data opening-up is managed by the Office of Information Policy and the U.S. General Services Administration. The former is in charge of the formulation of policies and laws, offering advice and guidance on data opening-up; the latter constructs and maintains through its affiliated Office of Citizen Services and Innovative Technology the integrated government data opening-up platform data.gov, which releases all kinds of effective data. The Cabinet Office is the leader of the UK government data opening-up. It is in charge of department coordination, supervision, and formulation of policies. It has also established the Open Data Institute, Data Strategy Committee and Public Data Unit which are in charge of data opening-up. The New Zealand government has established three government data opening-up units with different functions, namely, Chief Executives’ Governance Group, Guiding Group, and Secretariat of Open Government Data, and one information officer team (Chief Information Officer Team), who are in charge of the regulation and supervision of opening-up and release of government data. 3. Formulation of data opening-up standards The U.S. government data platform describes datasets through the metadata solution, and offers standard digital signs that can regulate what is described, hence making data resource description standardized and improving data use efficiency. In ROK, public data can be read by the machine, and multiple technologies are adopted for the users’ storage and withdrawal of data, so that the availability and accessibility of data are guaranteed. Work Plan for the Pilot Program of Opening up of Public Information Resources of China makes explicit the open data scope and data quality,

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encouraging the priority of CSV format and requiring that the machine-readable datasets that can be downloaded should account for no less than 90%, and datasets that can be downloaded with API Interface for no less than 30%.

4.4 Challenges to Open Government Data 4.4.1 High-Value Data Opening-Up to Be Enhanced According to Open Data Barometer released in 2017, only 7% of data has been totally opened up, one-half of datasets are machine-readable, and one-quarter of them have the permit for opening-up. Open government data tends to be incomplete, out-of-date, poor in quality, and scattered. Of 115 governments covered by Open Data Barometer, only 79 have open data portal websites, and the most complete data tends to come from somewhere else rather than the portal websites. In the said countries, 61% of the most complete datasets are released by governmental agencies rather than portal websites.2 A large amount of government data has to be opened up, and the open data has to be improved in quality and value to meet the demand of the public.

4.4.2 Digital Divide to Be Closed United Nations E-Government Survey 2018 shows that despite the progress in government data opening-up, there exists a wide digital divide. More and more countries are making effort to close it, and the number of countries providing online service for low-income people has quadrupled and the number of countries providing the same service for youths, women, immigrants, refugees, senior citizens, and the disabled has doubled. Besides, many countries have made plans on digital quality cultivation, and through digital aid helps those social members who cannot obtain online service. For instance, the Singaporean government has made Silver Infocomm Initiative (SII) to help senior citizens who have no educational background or digital skills; and the Portuguese government has launched the Citizen Spots Program to help citizens with Internet disorder.3

2 World

Wide Web Foundation. Open Data Barometer. 2017.

3 http://www.e-gov.org.cn/article-167187.html.

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4.4.3 Data Upgrading and Maintenance to Be Enhanced Data upgrading and maintenance are to be enhanced. Seen from the development of open government data, opening-up is only the foundation, but maintenance and upgrading of data are the keys to the improvement of data value. Meanwhile, the government is weak in open data preservation, and there is no effective data-keeping mechanism or special institution for protection, management, and supervision of the uploaded data. The government is unable to know or supervise whether some data has been misused or damaged.

4.4.4 Great Challenges to Privacy and Security Government data security is of great significance to national cybersecurity and personal privacy protection, which are faced with great challenges with the increasing openness of government data. In the first half of 2017, there were 1.9 billion pieces of data disclosed worldwide, up 160% from the second half of 2016.4 Online rumors, culture penetration, and critical information theft as well as cyber terrorism are all threats, so the international community should strengthen dialogues, consultation, and cooperation in terms of cyberspace administration, protect cyber sovereignty and national security, and work together to promote information sharing and shared governance of cyberspace.

4.4.5 Governmental Collaboration Capability to Be Improved The government can be taken as a synthesizer of all kinds of public data resources, whose collection and preservation rely on the government. But on the other hand, deep exploration and value development of data cannot be done by the government itself, who has to improve its capability of collaborating with citizens or other organizations, so that the potential values of government data can be tapped through the joint innovative effort of the whole society. For instance, the open data platforms built on governmental portal websites have made the operation more complex, and the government information columns and open data columns overlapped, which is not favorable for users’ experience and obtaining of data. Such a mode tends to be flexible, which can lead to wasting of data resources and difficulty in open data pathing and sharing.

4 Zou

Hongqiang. Big Data Application Opportunities, Sharing and Opening-up and Security Challenge [J]. Perspective of Experts. 2018(04): 769–772.

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4.5 Trends of Opening-Up of Government Data 4.5.1 Deepening of Technology-Driven Government Data Opening-Up The increasing amount of data demands broader pathing and more advanced technical support for its opening up. The development of big data and distributed technology has contributed to the solution of computing power and training data amount. The combination of big data and cloud computing will facilitate the high-speed and precise development of e-government. Governmental service will see another leap in speed through big data on cloud platforms facilitated by container technology, which will improve the basic service capability of AI.

4.5.2 Open Government Data Enhancing the Capability of Governance Today, some countries’ government has begun to use big data in their governance and has seen some remarkable results in that respect. HSC of the UK government has launched the program of climate change’s impact, according to which in-depth analysis is made on multiple departments’ data to study climate change’s impact on the availability of food and water and hence to improve the government’s scientific policy-making competence. With the explosive growth of data, open government data will facilitate governmental administration and governance capability. Such data will be applied to social administration and public service, and the application is becoming a means of system reform and modernization of national governance systems and capabilities.

4.5.3 Open Government Data Ushering in New Industries New industries with information as the orientation are being ushered in by open government data. The government can open communication and statistical information to businesses for reuse to form new economic growth points. For instance, www. chelaile.net.cn was China’s first business engaged in the real-time query of public transportation information, visualizing all information from the arrival time to arrival distance of public transports, and hence relieving the user’s anxiety of waiting. Its APP now covers 60 million users from 108 cities, including Beijing, Shanghai, Guangzhou, Shenzhen, Tianjin, Hangzhou, Chongqing, and Chengdu. Citymapper,

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Fig. 4.10 Homepage of citymapper APP

a mobile phone APP from London, helps people with their transportation through open transportation data and with their travel planning. Its website shows that by September 2018, it was accessible to 39 cities including London, Paris, New York, Sidney, Singapore, and Hong Kong, as is shown in Fig. 4.10.

Chapter 5

World Internet Media Development

5.1 Overview (1) In the field of media, AI was first used in robot news writing, and later in news editing, hotspot discovering, and fact judgement. In China, Tencent Finance, Toutiao, and Xinhua News Agency have applied robot writing to news reporting. AI has also brought new experience in news reading. However, there are also some disadvantages of it in media, so a joint effort is required, and the capital and public interest should be balanced in news editing. (2) The combination of VR and AR with live streaming is the new hotspot in the video business. The unchangeability and traceability of blockchain make media source authentication easy, and its anonymousness and distribution are also used for news production review and content payment. Algorithm is widely used in news production and distribution. Facebook, Toutiao, Kuaishou, and Douyin are all typical cases of deep application algorithms. (3) The Internet media industry is growing steadily, and news media continue to grow, with good operation and user status. Social media’s development is seeing a bottleneck, and the leading businesses are growing slowly, or they are faced with industry reshuffle. Knowledge platforms are developing, and they may become a dark horse of the Internet. Visual and audio media are developing dramatically and short video is striding forward. (4) Generally, affected by fake news, the public have increasing trust in mainstream media and traditional news, but have decreasing trust in social media and search engine, even the lowest trust. (5) Social media sees a declining use rate in the United States, the United Kingdom, and France. A decreasing number of users read news on social media. Facebook remains the most popular social medium, then come YouTube, Whatsapp, WeChat, Instagram, and QQ. (6) In 2018, there were more active users of knowledge platforms like Quora, Zhihu, and Ximalaya FM. Their content is shifting from graphic knowledge to audio and

© Springer Nature Singapore Pte Ltd. 2020 World Internet Development Report 2018, https://doi.org/10.1007/978-981-15-4067-7_5

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visual knowledge. They are seeking for new profitable means, like advertisement and paid content. (7) YouTube is the world’s largest comprehensive video platform. The number of users and income of Digital Video On Demand (DVOD) keep growing rapidly. The United States takes the lead in market volume with USD15.589 billion. Netflix, Spotify, Amazon, and Tencent Music are seeing the number of their paying users increasing. (8) Fake news governance is a global problem. The United States has set up PolitiFact, FactCheck.org, and Fact Checker, three major fact check agencies. In that country, a number of news and science and technology businesses have joined the Anti-Fake News Alliance. The UK government has launched special investigations, and fact-checking departments have been set up in media organizations and nongovernmental agencies. Federal Ministry of Justice of Germany, Correctiv Nonprofit Investigation News Agency, and Facebook have jointly carried out a check of suspicious reports. France has set up a data verification center, which cooperates with multiple partners in checking fake news. The ruling party of Russia has submitted to State Duma a proposal on fake news control. China has formulated administrative laws on that respect and set up the Internet United Rumor Refuting Platform.

5.2 Innovation of World Internet Media Technology World Internet media technology is developing fast. AI, blockchain, and VR are producing an impact on and changing the organization and operation of media, and contributing to the improvement of productivity. On the other hand, there have occurred new social problems and the relationship between technical progress and social development has to be balanced.

5.2.1 Application of AI As early as in 2006, Thomson Financial began the attempt to write economic and financial news with computer program. With the maturity of technology, AI has been applied to news editing, hotspot discovery, and fact judgement. Blossom, a robot editor developed by New York Times, can sort out content more applicable for social promotion through the analysis of articles pushed on platforms like Facebook. The sorted out articles have 38 times more clicks than average ones. The Guardian uses a robot for hot article statistics, analysis, and sorting, and hence a newspaper named #Open001 has been produced with the algorithm. Washington Post used to try to use the robot named Truth Teller to check the accuracy of news. The robot can transcribe voice into text to compare it with the information in the database and hence to judge whether the speaker is lying. A link can thus be formed automatically

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to help users to acquire more knowledge and news. Xinhua News Agency of China developed, at the end of 2017 Media Brain, an intelligent platform that can analyze video content, identify and detect factors, and obtain relevant data with a sensor, and quickly generate texts, pictures, voices, and videos. AI enables users to have a new experience of obtaining news. In October 2017, Heilongjiang Broadcast TV Station had Xiaozhi, the virtual anchor, in the studio during the broadcast of the 19th National Congress of the CPC, so that a dialogue was made between a human anchor and a virtual one. Quartz, a digital commercial news website, once pushed its news APP in human–machine dialogues. The APP can recommend news to readers by chatting. When they are interested in something, the readers can click the options below the window to ask more questions and to know more details. All content pushed by Quartz is sorted by some editors. Algorithm is adopted for interaction with users and for the recommendation of news. AI has its own limit or even disadvantages. It is more applicable to data-intensive areas, with greater potential in rumor control, but with disadvantages like high cost at the beginning, immature technology, and limited applicability. AI’s application to media causes challenges to existing governmental supervision and legal responsibility division. Therefore, the government is expected to guide and supervise it and the relationship between capital and public interest should be balanced.

5.2.2 Application of VR and AR VR and AR have changed the product forms, reporting ways, and transmission modes, enabling the content to go beyond image and text and video. They can trigger different senses of human beings, so that users can know better about news in a true-to-life environment, consider the news even in the first person, and complete their own news editing from a personal perspective.1 So far, mature VR/AR products are Oculus Rift, HTC Vive, Samsung Gear VR, Google Day Dreamer, and Sony PlayStation VR. VR/AR news can be categorized into deep reports, disaster reports and battlefield news, sport and competition news, science and technology, and popular science news.2 VR/AR news is faced with some challenges in application, such as immature collection and editing, high cost of editing, and limited topic selection.3 VR/AR devices are not so popular among users, who are easily tired after long wearing. Relevant technology has to be improved. As for the content, VR/AR news has its ethical limit. For instance, how can we ensure the objectivity of news and what

1 Wei

Xiao and Pan Li’an, VR Technology: impact on and change of news transmission[J]. New and Writing, 2017(8):100–102. 2 Han Xiao. Transmission Opportunity and Possibility[J]. Editors Monthly, 2017(5):48–53. 3 Zang Meichen. Challenges to VR and Their Counter-measures in News Reporting[J]. Radio &TV Journal, 2018(07):181–182.

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mental impact does violent and bloody scene produce on the audience4 ? Therefore, it will be an important direction of VR news to enhance interactivity and the user’s experience, to solve problems in the development, and to improve the popularity.

5.2.3 Application of Blockchain Blockchain can be highly integrated into media. It can be applied to data sharing, media information source verification, intellectual property protection, content payment, and fake information control. In October 2017, the nonprofit foundation PUBLIQ launched a media platform based on blockchain. On it, every article is encrypted like Bitcoins and is shared and transmitted in the form of P2P like Bitcoins to ensure the traceability of the article. In September 2018, Mi, in collaboration with Anchor, launched the Bridge Program, a blockchain advertisement, in which on-the-link data exchange and brand advertisement driven by blockchain data were completed. The U.S. blockchain business Binded allows cyber content creators to record their works on the Bitcoin blockchain through encrypted verification to protect their copyright. ATMChain oriented to media advertising, based on DECENT underlying technology, allows the users’ attention to be quantized in a paid way through blockchain technology, and gives proper award to stimulate their enthusiasm, eradicating fake data and ensuring more precise and efficient advertising by media operators.

5.2.4 Algorithm Innovation Algorithm recommendation is widely used in media to increase the news generation scale and distribution speed as well as the accuracy and flexibility of text expression to meet the demand of different audiences and make possible customized news service. On the other hand, algorithm application has given rise to some problems. For instance, the so-called precise recommendation is not completely precise. There is sometimes misjudgement of algorithm, so the user’s demand cannot be completely met. Algorithm recommendation requires the collection of users’ data, which may give rise to privacy disclosure, and “information narrowing” may give rise to a lack of personal knowledge and solidification of views. Besides, algorithm is not good enough for the judgement of fake news or facts, so it may enhance the transmission of fake news. In May 2016, Trending Topics of Facebook was accused of being manipulated and of having political prejudice on news sorting. After that, Facebook innovated its News Feed algorithm, proposing that it would enable the users to read more authentic 4 Chen

Yong & Mu Haojie. Impact of VR on News Report: a perspective of media technology determinism[J]. Media, 2017(11):79–82.

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news, and that information from groups, media, brands, or other sources should be weakened. It also released News Feed values covering socializing priority, useful information as the critical, remembrance of entertainment, plural views respect, and authenticity priority. Toutiao, launched in China in 2012, is a typical news platform driven by algorithm, taking the users’ personal information demand as its target. There used to be obscene content and click bait when the algorithm was adopted to explore data and recommend news. To deal with the problem, Toutiao adjusted the algorithmic logic to improve the content examination standard and optimize the process of examination.

5.3 General Situation and Representatives of World Internet Media 5.3.1 New Media: Increased Credibility in Mainstream Media and Traditional Media Fake news is a concern and heatedly discussed topic worldwide. The public’s credit on news agencies and Internet news media has generally increased, but their credit on social networks and search engines has decreased. In 2018, 59% of respondents said they trusted news agencies and Internet news media. The percentage has been increasing from the year 2012. The credit on social networks and search engines has decreased to the lowest, at only 51%.5 34 percent of respondents said that they trusted the news they found through search engines, while less than 23% said that they trusted the news that they read on social networks. The variation of users’ credit on news sources across the world is shown in Fig. 5.1.

5.3.2 Social Media: Crisis of Confidence Facilitating Governance in the Industry Due to the crisis of confidence, users tend to use social media less to browse, share, and comment on the news. In 2018, the use rate of social media decreased in the United States, the United Kingdom, and France. According to Reuters Institute Digital News Report 2018, the monthly news use rate on the U.S. social media decreased from 51% in 2017 to 45% in 2018; that on the UK social media decreased

5 Edelman,

Do you trust each source for general news and information?, Statista, https://www-sta tista-com.unh-proxy01.newhaven.edu/statistics/381455/most-trusted-sources-of-news-and-infoworldwide/ (last visited Sep. 20, 2018).

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Fig. 5.1 Variation of users’ credit on news sources across the world (* traditional and online-only media. ** search engines and social media platforms)

from 41 to 39%.6 Social media like Facebook and Twitter became popular because of their fast information conveying, but on the other hand, they became breeding ground for fake news and rumors. Pushed by the government and public opinions, they began to erase accounts for fake news and robot accounts for spreading such news. Facebook has set up a user credit system in which the user credit is graded according to the authenticity of the content the users have released.

5.3.3 Knowledge Platforms: Audio/Visual Content Increasing, and New Profit Models Being Explored Quara, Zhihu, and Ximalaya FM, typical media of knowledge platforms, have had more active users in 2018, shifting their content from texts and images to audio/visual knowledge and exploring new profit models through advertisements and paid content. In July 2018, Quora had over 300 million active users. According to Alexa data, by February 28, 2018, it ranked 136th among all websites in the world. The United States’ market volume accounted for 37.1% as the biggest country in that respect.

6 Source:

Reuters Institute for the Study of Journalism, Digital News Report 2018, http://www.dig italnewsreport.org/.

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Then came India, whose market volume accounted for 19.2%. Quora has launched answers in video forms and opened up its operative platform to advertisers. Zhihu had in May 2018 about 160 million registered users, with an annual growth of 95.12%, including 14,000 institutional users,7 with over 100 million answers. Through the AI product “problem routing”, Zhihu matches answers with questions quickly and provides content that users are interested in or that are helpful to the users’ growth. Ximalaya FM attempted around 2016 to provide audio products with paid content. In the first half of 2018, it announced that on average, every user had listened to 18 audiobooks, and their accumulated listening time amounted to 3.08 billion hours.8 Audiobooks have more than 50% traffic of the total of Ximalaya. Most of them are free of charge and only a few are paid ones, which contribute to over 50% of the total income of Ximalaya.

5.3.4 Audio-Visual Media: More Paying Users In the second quarter of 2018, Netflix, an online video business, had a revenue of USD 3.907 billion, up 40.3% on a year-on-year basis, with a net profit of USD 384 million, up to 482%. In the same period, it had 5.14 million new paying subscribers.9 In July 2018, YouTube had over 1.9 billion monthly active users, and the number of interactions such as thumbs-up, comments, and chats increased by 60% on a yearon-year basis. The content of live streaming has seen an increase of 10% in the past three years. YouTube is successful in mobile terminal strategies, especially in the download list and in income. The number of digital VoD users and the income of it keep increasing rapidly. Digital video refers to OTT VoD distributed on the Internet, including three commercial models based on payment: pay-per-view, streaming, and download. Pay-per-view has the largest number of users, which grows the fastest. It is the mainstream model in developed countries like the United States. In China and other emerging countries, streaming is popular. As for the market volume, the United States is far ahead of other countries with USD 15.589 billion.10 Global income change of digital VoD (categorized by payment mode) is shown in Fig. 5.2. The music platform Spotify had a total revenue of 1,273 million euros in the second quarter of 2018, up to 26% on a year-on-year basis, but a net loss of 394 million euros. It has 180 million monthly active users, up to 30%, including 83 million advanced paying users. With Echo, Alexa, and Amazon Prime, Amazon had 27.9 million subscribers in the first half of 2018, and its market volume accounted 7 Source:

Sohu Science, http://www.sohu.com/a/232228436_257199. Source: Sohu Science, http://sh.people.com.cn/n2/2018/0716/c134768-31820164.html. 9 Source: Financial Statement of Netflix in Q2, 2018, https://36kr.com/p/5143655.html. 10 Source: Digital Media Report 2018—Video-on-Demand Statista Digital Market Outlook, https://www-statista-com/outlook/201/100/video-on-demand/worldwide#market-revenue. 8 Source:

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Fig. 5.2 Global income change of digital VoD (categorized by payment mode) (Source Statista)

for 12% of the global total; Tencent music had 17.6 million paying users and its market volume accounted for 8%. The market volume of Deezer, Google’s paid music products, and Pandora accounted, respectively, 3%.

5.4 Governance of Fake News on the Internet Wide spread of fake news on the Internet not only harms the credibility of media, but also misleads the public, affecting social order. It is a global problem, so all countries are combating fake news by setting up special fact-checking organizations and databases, or using AI technology.

5.4.1 The United States: Cooperation Between Independent Fact-Checking Agencies and Media In the United States, fake news administration innovation is shown in the cooperation between independent fact-checking agencies and media. In that country, news practitioners have set up three fact-checking agencies, namely, PolitiFact, FactCheck.org, and Fact Checker, through which news checking is carried out. The three agencies have their own background and standards, but adhere to one principle that they provide directly relevant facts to correct to the maximum extent some fake information concerning public view and political discussions.11 Meanwhile, Internet media are enhancing their own checking. In August 2016, Facebook succeeded in checking machine algorithm. In November 2016, it began to 11 Cheng Wei & Gao Yibin. Enlightening Significance of Western News Fact-checking on China’s Fake News Control[J]. Information Security and Communications Privacy, 2018(8).

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cooperate with International Face-Checking Network (IFCN), inviting ABC News, AP, Washington Post, and other IFCN members to use its tools to assess jointly the authenticity and accuracy of news. Google marks and checks the authenticity of information via reliable news checking agencies and ClaimReview on Schema.org, which is an HTML mark founded in 2011 by Google, Bing, and Yahoo! to optimize searching results. Till now, it has 115 cooperative agencies, including third-party fact-checking agencies like Snopes and Politifact, having formed a special thirdparty fact-checking agency. Over 30 businesses of Internet media including Twitter and BuzzFeed joined in September 2016 the First Draft Coalition, an anti-fake news alliance launched by Google, wishing to control fake news on social media and to improve information quality.12 Column 6:Three Major Fact-checking Agencies in the United States FactCheck.org, founded in 2003, is a non-profit website politically unaffiliated based in the University of Pennsylvania. On it, users can raise questions about popular issues. Then complete information is offered and viral spiral rumors based on minor facts are clarified. At the same time, fact-checking labels are provided on the information released by readers on it. No rating is adopted for checking results on FactCheck.org, but direct judgement is given on the content. PolitiFact was founded in 2007 by Tampa Bay Times affiliated to Poynter Institute, a prestigious media education institution of the United States. It was aimed at the very beginning to screen and check from an independent and objective perspective the political speech during the presidential election of the country in 2008. It was characterized by a number of tools used for fact-checking, with the most famous one as Truth-O-Meter, which could rate the authenticity of information into six grades, namely, authentic, basically authentic, partly authentic, mostly inauthentic, inauthentic, and completely inauthentic. Later, it expanded the scope of fact-checking. In collaboration with the news research institution Poynter Institute, it launched the PunditFact Project to check the authenticity of media practitioners’ speech. Thanks to its excellent performances, it won two years later a Pulitzer Prize—Pulitzer for National Reporting as the first network medium. Fact Checker, a column set up in 2007 by Washington Post, has played a great role in supervising political speech. A survey made in 2015 shows that the after-the-event checking by Fact Checker has, to some extent, improved political discourses. Politicians tend to be more cautious in delivering speeches to safeguard their reputation and election security.

5.4.2 The United Kingdom: Collaboration Among the Government, Media, and Nongovernmental Organizations The UK media organizations established fact-checking departments very early to combat fake news. In 2015, to report on Brexit accurately, BBC established Reality Check, which is now part of BBC core news reporting. Faced with so much fake news, 12 Cheng Wei & Gao Yibin. Enlightening Significance of Western News Fact-checking on China’s Fake News Control[J]. Information Security and Communications Privacy, 2018(8).

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some nongovernmental agencies of the United Kingdom have begun fact-checking. For instance, Full Fact, an independent nonprofit organization, is specialized in checking fake information. The referendum on Brexit in 2016 was affected by fake news. Afraid of the threat that fake information may pose to a democratic society, some influential Parliament members began to investigate into fake news to define the standards of such news, recognize misleading information, and call on search engines like Google, Twitter, and Facebook and social media businesses to shoulder more social responsibility for the combat against fake news.

5.4.3 Germany: Joint Checking by Federal Ministry of Justice and Facebook In January 2017, Facebook announced that it would screen fake information for German users, by checking suspicious reports in collaboration with Germany Correctiv, a nonprofit news investigation agency. In March 2017, Federal Ministry of Justice of Germany published a draft act, requiring social media like Facebook to delete in time hatred speeches and fake news spoiling others’ fame; otherwise, they would be fined as high as 50 million euros. The draft also provides that a whistle-blowing function should be set on social media networks, allowing users to report illegal content on the websites around-the-clock. Once the report is verified, the relevant website will have to delete the illegal content and its copy within seven days. Column 7: Cooperation between Facebook and German Correctiv in Checking Suspicious Reports Tools provided by Facebook that can identify fake news send news reports labeled by readers as fake to Correctiv for authenticity verification. Any news that is considered as fake will be labeled as “disputed” and will be explained. Disputed news is not recommended on Facebook according to its algorithm but is put at the end of news flow. Any user who is going to share such news is warned by Facebook. But local media in Germany have not begun their cooperation with Facebook. Dorfner, CEO of Springer, pointed out, “We are not a corrective organization for Facebook”. This shows that Facebook has to cooperate with more media agencies though it is active in countering fake news.

5.4.4 France: Founding of a Data Checking Center and Cooperation Among Different Parties in Checking Major media in France counter fake news through affiliated fact-checking organizations. Le Monde has the most advanced fact-checking organization in France–Les Décodeurs, which is a data news center of the newspaper. Its three reporting directions

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are interpretive news reporting, data news reporting, and fact-checking reporting. In collaboration with ministère de l’éducation nationale (Ministry of National Education), primary, secondary, and tertiary education institutions, Le Monde hopes to help them to set up fact-checking resources and tools and cultivate the young generation’s capability of identifying fake news. Column 8: Fact-checking Database of Le Monde In January 2017, Le Monde launched a fact-checking database named Décodex, which is aimed to help its readers to identify fake or unreliable websites. Its fact-checking unit checked over 600 websites, including Blog, Facebook, and Twitter, and classified them in accordance with their credibility and accuracy. When using Le Monde search engine, readers, with the help of the color encoding system, can learn about the reliability of a website. Those websites marked in green are highly reliable, those in yellow should be read with caution, and those in red suggest may offer fake information or fabricated stories. Most important, those with scorns are marked in blue and some that cannot be verified are marked in gray. Users can label some websites that are not part of the database yet and then check them and add them to the database. Le Monde fact-checking unit points out that the classification has nothing to do with political attitude, but with authenticity and accuracy. The newspaper’s news checking database is an open-source one, which can be used by other media and audiences. Le Monde is planning to promote its database to overseas, so that it can be used by more people.

Besides local media in France, Google and Facebook, in collaboration with APF, Le Monde, and Les Échos, launched in February 2017 Cross Check, a separate factchecking website, for which readers interested in fake news can provide unchecked information or post from problematic websites or social media. Cross Check working unit checks these reports and websites. So far, 37 media have been involved in the initiative, each contributing their own experience, resources, and local knowledge to speeding up and enhancing checking while ensuring that readers can read accurate reports. To improve the quality of checking, Cross Check invites some experts from Paris Journalism Institute to get involved.

5.4.5 Russia: Legislative and Administrative Measures Taken and Its Call on International Cooperation Emerging-market countries and developing countries also wish to counter fake news. In Russia, the legislative and legal systems for journalism need to be improved. There are difficulties in countering fake news, which is increasingly rampant.13 In July 2016, the country required content aggregation websites to check all reports from overseas media. The Ministry of Foreign Affairs developed a new module on its website to disclose fake news with anti-Russia content. United Russia submitted at the end of 2017 to State Duma a proposal on controlling fake information on social media, with reference to Network Enforcement Law of Germany. The proposal requires that any 13 Chirkova

Veronika, A Study of Mass Media Corruption Control in Russia Federation[D], South China University of Technology, June 2017.

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social network medium with over 100,000 daily active users should delete within 24 h any improper views posted by the users. Any website that cannot manage that will be fined as high as 50 million rubles or USD 793,000. If the proposal is passed, Russia will be the second country, after Germany, which has national legislation on the Internet and social media.14

5.4.6 China: Administrative Regulations Taking the Leading Role In May 2017, Cyberspace Administration of China released Provisions for the Administration of Internet News Information Services, which provides that Internet media agencies “should not twist or tamper the original meaning of headlines and news content”. It guarantees the traceability of Internet news and to some extent, contains generation and spread of fake news. In August 2018, China’s Internet United Rumor Refuting Platform was launched in Beijing jointly by Illegal and Harmful Internet Information Reporting Center of China and Xinhuanet.com. On it there are columns like Information Release by Ministries, Local Responses, Media Verification, Expert’s Perspective, and Rumor Refuting Classroom, allowing rumor reporting and verification and providing competent authorities’ or experts’ rumor refuting information. It can also provide targeted rumor refuting through big data or allied authorities, multiple-terminal spread, immediate fingertip verification, and prevention of rumors. It is accessible to over 40 rumor refuting platforms in the country, having 30,000 pieces of information for rumor refuting. It is guided by the government, with key central news websites, local rumor refuting platforms, portal websites, and expert think tanks all playing their role in exploring the work model involving joint discovery, tackling, and rumor refuting.

14 Shi

Wenbin & Wang Peinan. Blocking Action against Fake News: a starting point for global Internet governance[J]. Youth Journalist, March 2013.

Chapter 6

World Cybersecurity Development

6.1 Overview At present, cybersecurity is increasingly threatened by cyberattacks, crime, and privacy disclosure. All countries are strengthening their attention to cybersecurity and have taken a series of actions in accordance with their own situation and the world Internet development to improve their capacity of cybersecurity guarantee. (1) Web spoofing sees the increase of its number, and attackers are upgrading their spoofing means. Phishing attackers are shifting their targets from individuals to businesses. DDoS with application as its target is increasing in quantity and scale, with power-law distribution. (2) The number of Trojan and botnet attacks remains high while that of malicious programs is decreasing. The number of ransom software attacks is growing explosively, with active continuous advanced attacks. The security of IoT is more seriously threatened. New IoT security maturity models and laws are being launched. The input in IoT security is increasing. Large-scale data breaches keep occurring, threatening the security of data from governments, businesses, and individuals. There is an increasingly heated discussion of AI development and security. (3) All countries are taking a series of cybersecurity protection actions to safeguard the security of their nation, economy, society, and people. These actions include improvement and formulation of cybersecurity strategies, laws and regulations, protection of critical information infrastructure, talent production and awareness cultivation, and especially the enhancement of data and privacy protection and combat against cybercrime and terrorism. (4) The global cybersecurity industry is growing steadily and has become the mainstay of economic and social development. All governments are facilitating their cybersecurity industry development, carrying out programs of cybersecurity talent production, increasing their input in cybersecurity industry, and improving the cooperation between governments and businesses. © Springer Nature Singapore Pte Ltd. 2020 World Internet Development Report 2018, https://doi.org/10.1007/978-981-15-4067-7_6

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6.2 Threats to Cybersecurity There is an increasing number of cybersecurity incidents in which various means are adopted, with increasingly destructive power. They have been expanded into all fields like politics, economy, culture, and society. Cybersecurity is becoming a major concern related to national and regional security.

6.2.1 Upgrading Web Spoofing 1. Increasing number of web spoofing incidents According to statistics from APWG, the number of web spoofing incidents increased dramatically in February and March of 2018, in the latter month, the number being twice that in January.1 PhishLabs, a threat studies center, released 2018 Phishing Trends and Intelligence Report, according to which phishing attacks on social network platforms have quadrupled. According to the Cert NZ Quarterly Report (Q1) of New Zealand CERT, the country saw an increase of 55% of phishing attacks in the first quarter of 2018 in comparison with the previous quarter and phishing was the leading attack in that quarter.2 2. New means of web spoofing The means of web spoofing keeps being upgraded, and they are more covert, which poses great risks and threats to network finance. According to Threat Landscape Report 2017 released by ENISA in early 2018, web counterfeiters have begun to use social media and some legal websites to launch their attack, leading users to trust phishing websites, and thus supervision and tackling become more difficult.3 According to an APWG report, web counterfeiters have begun to use HTTPS means to hook users. The 2018 Security Report of Check Point shows that in retailing, a large amount of customers’ information is stolen through web spoofing, which is combined usually with XSS, so that victims never suspect the authenticity of webs.4 There are more phishing attacks on SaaS and emails, and they are shifting from individual consumers to small businesses, schools, governmental agencies, critical infrastructure, and medical facilities. 1 APWG. Phishing Activity Trends Report 1st Quarter 2018. https://docs.apwg.org/reports/apwg_t rends_report_q1_2018.pdf, July 31, 2018. 2 New Zealand CERT. Cert NZ Quarterly Report: Highlights. Q1 1 January, https://www.cert.govt. nz/assets/Uploads/Quarterly-report/2018-Q1/CERT-NZ-Quarterly-report-Highlights-Q1-2018. pdf, March 31, 2018. 3 ENISA, ENISA Threat Landscape Report 2017. https://www.enisa.europa.eu/publications/enisathreat-landscape-report-2017, January 15, 2018. 4 Check Point. 2018 Security Report. https://www.checkpoint.com/downloads/product-related/rep ort/2018-security-report.pdf, May 28, 2018.

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6.2.2 Continuous DDoS 1. Doubled attacks on applications Global DDoS Threat Landscape Q4 2017 5 of Incapsula shows that the number of DDoS attacks on applications has almost doubled, with its scale increased. There are more attacks on applications than on networks, and such attacks are the most widely launched ones. According to 2017–2018 Global Application and Network Security Report released by Radware, 64% of businesses are faced with DDoS attacks on applications while 51% of them are faced with such attacks on networks.6 2. The number of attacks in power-law distribution According to Global DDoS Threat Landscape Q4 2017 of Incapsula, continuous DDoS attacks are becoming common. In general, 63.3% of the targets are subject to more than one DDoS attack, and 25.1% to more than six attacks.7 According to General Description of China’s Cyber Security in 2017,8 the year 2017 witnessed serious DDoS attacks in China and the peak value kept increasing. Meanwhile, the number of attacks from resources like control sites, controlled sites, and reflection servers is in power-law distribution (see Fig. 6.1). Most attack resources are used to launch only a few attacks but some are used permanently and repeatedly. DDoS hacker attacks are industrialized on platforms. With a simple registration, one button, and several hundred yuan in RMB, attacks can be launched throughout a month. Meanwhile, those DDoS platforms are trying to improve their success rate by reducing the cost to the lowest but achieving the best result, which indirectly shows why the number of attacks from network resources and the number of days of attacks are in power-law distribution.9 3. Reflective DDoS becoming more common According to ENISA Threat Landscape Report 2017 released in early 2018,10 reflective attacks are the most common DDoS ones. To be specific, among all the DDoS attacks, 33% are reflective DNS ones, 28% reflective NTP ones, 17% reflective CHARGEN ones, and 12% reflective SSDP ones. Radware finds that amplified reflective DDoS is the major medium of attacks. In 2016, 40% of businesses were subject to 5 Incapsula.

Global DDoS Threat Landscape Q4 2017, https://www.incapsula.com/ddos-report/ ddos-report-q4-2017.html [OL]. 6 Radware. 2017–2018 Global Application & Network Security Report. https://www.datacom.cz/ userfiles/radware_ert_report_2017_2018_final.pdf, January 16,2018. 7 Incapsula. Global DDoS Threat Landscape Q4 2017. https://www.incapsula.com/ddos-report/ ddos-report-q4-2017.html [OL]. 8 CNCERT. General Description of China’s Cyber Security in 2017 [OL]. April 25, 2018. 9 Knowsec. http://www.ijiandao.com/2b/baijia/119902.html [OL], May 24, 2018. 10 ENISA. ENISA Threat Landscape Report 2017. https://www.enisa.europa.eu/publications/enisathreat-landscape-report-2017, January 15, 2018.

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Fig. 6.1 Number of DDoS attacks from control terminals in power-law distribution

such attacks, and one-third of them said that they were unable to alleviate the attacks. According to General Description of China’s Cyber Security in 2017, reflective NTP ones and reflective SSDP ones are the leading attacks among all DDoS attacks in China.11

6.2.3 Big Threats from Trojan and Botnet Attacks 1. Large-scale Trojan and botnet attacks and longer time of infection by such attacks The comparison between Threat Landscape Report Q2 201812 and Threat Landscape Report Q1 201813 of Fortinet shows that the number (265) of botnet attacks detected in Q2 remains almost the same as that (268) of botnet attacks detected in Q1 of 2018, but the average number of days of infection rose from 6.6 to 7.6. According to General Description of China’s Cyber Security in 2017, in China, there were 49, 957 11 Cisco.

Cisco 2018 Annual Cybersecurity Report. https://www.cisco.com/c/dam/m/digital/ elq-cmcglobal/witb/acr2018/acr2018final.pdf?dtid=odicdc000016&ccid=cc000160&oid=anrsc0 05679&ecid=8196&elqTrackId=686210143d34494fa27ff73da9690a5b&elqaid=9452&elqat=2, January 16, 2018. 12 Fortinet. Threat Landscape Report Q2 2018. https://www.fortinet.com/demand/gated/q2-2018threat-landscape-report.html [OL], August 13, 2018. 13 Fortinet. Threat Landscape Report Q1 2018. August 13, 2018.

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IP addresses of Trojan and botnet servers in 2017, up to 2.5% from 2016. Among the botnets infected by Trojan or botnet programs, those with 100–1,000 controlled terminals accounted for over 72.7%.14 2. Emerging botnets constructed through virtual machines Cloud computing provides convenience and low cost, but opens up a new field for botnet. In threat scenarios of cloud weaponization, attackers can set up their strongholds in cloud infrastructure to attack and control some virtual machines through which attacks are launched. According to ENISA Threat Landscape Report 2017, large cloud service providers like Google have warned businesses that cybercriminals are transferring virtual machines on cloud into broilers (also called puppet machines) to construct their botnets.

6.2.4 Malware Attack Remaining a Major Threat 1. Malware attack remaining a major attack According to ENISA Threat Landscape Report 2018, in the year 2017, malware remained the most frequent cyberattack, with four million samples detected every day. According to Cybercrime Survey Report 2017 released by KPMG in December 2017, 73% of organizations deem malware as the largest cyberattack, and 43% of them had been subject to ransomware attacks in the previous year.15 2. Updated ransomware Cisco 2018 Annual Cybersecurity Report shows that one of the attack features in 2017 was the updating of ransomware. For instance, a new ransomware variety named Nyetya can update the system deployment through software and infect a large number of computers within a short time.16 According to Internet Security Threat Report released by Symantec in March 2018, the number of new types of ransomware increased by 92% in 20 17, witnessing a dramatic increase from 0.5% in 2016.17

14 CNCERT.

General Description of China’s Cyber Security in 2017 [OL]. April 25, 2018. Cybercrime Survey Report 2017. https://assets.kpmg.com/content/dam/kpmg/in/pdf/ 2017/12/Cyber-Crime-Survey.pdf, December 14, 2017. 16 Cisco. Cisco 2018 Annual Cybersecurity Report. https://www.cisco.com/c/dam/m/digital/ elq-cmcglobal/witb/acr2018/acr2018final.pdf?dtid=dicdc000016&ccid=cc000160&oid=anrsc0 05679&ecid=8196&elqTrackId=686210143d34494fa27ff73da9690a5b&elqaid=9452&elqat=2, January 16, 2018. 17 Symantec. Internet Security Threat Report Volume 23. https://www.symantec.com/content/dam/ symantec/docs/reports/istr-23-2018-en.pdf, March 20, 2018. 15 KPMG.

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6.2.5 Active APT 1. Government, national economy, and people’s livelihood becoming areas seriously afflicted by APT Tencent Security Report on APT in the First Half of 201818 shows that the government remained the major target of APT (accounting for 16%). Energy (16%), military affairs (11%), telecommunication (11%), finance (8%), and industry (8%) are also areas seriously afflicted by APT. Therefore, it is clear that APT targets are concerned with the national economy and people’s livelihood. The security of governments, institutions, businesses, and individuals is seriously threatened. 2. More integrated technology and more channels for attacks According to Tencent Security, most APT organizations prefer attacks through vulnerability, with NDay vulnerability attacks accounting for 47% and 0Day vulnerability attacks 13%. There are frequent attacks with social engineering cheating, with macro document attacks accounting for 13% and DDE document 7%. Maturing vulnerability digging technology and vulnerability POC publication makes the use of vulnerability easier and easier. 0Day vulnerability is taken as the nuclear weapon of APT organizations, who are good at using harpoon mails, vulnerability attacks, water hole attacks, and third-party channels with a high hit rate for their attacks.

6.2.6 Frequent Large-Scale Data Breaches 1. Severe data breaches from social platforms According to statistics by IT Pub Community on top 10 data breaches both in China and abroad in the first half of 2018, seven of them happened to social and life service websites, including Facebook, Panera Bakery, Under Armour, Ticketfly, and AcFun. Cambridge Analytica Incident involved the breach of data of 87 million users; 37 million records of customers on the website of Panera were disclosed on April 2, 2018; 150 million pieces of data on MyFitnessPal under Under Armour were disclosed on May 25, 2018. 2. Great loss caused by data breach In general, the total loss, per capita loss, and scale of data breach were increasing year by year. IBM has released the 2018 Cost of Data Breach Study: Global Overview after an investigation with 2,200 experts of 477 businesses from 15 countries and 18 Tencent,

Tencent Security Report on APT in the First Half of 2018, https://s.tencent.com/res earch/report/512.html [OL], August 10, 2018.

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regions. The report shows that in 2018, the average cost of a data breach of a single record was USD 148, but it takes the attacked target 196 days to discover the attack and 69 days to tackle it. 48 percent of data breaches have been caused by malware or criminal attacks.

6.2.7 Intensified IoT Security Risks 1. Increasing number of vulnerabilities of IoT NSFOCUS released in March 2018 Annual IoT Security Report 2017 shows that over 49 million routers used in IoT have been exposed, the number much higher than that of other IoT devices exposed. Over 11 million video monitoring devices have been exposed, the number much higher than that of traditional devices like firewalls and interchangers, second to that of routers exposed.19 According to Cisco 2018 Annual Cybersecurity Report, there are more IoT devices and software library vulnerabilities. From October 1, 2016 to September 30, 2017, 224 new vulnerabilities were discovered, 40 (17.86%) of them related to the third-party software library, and 33% of them related to IoT devices. The vulnerabilities have been recovered slowly or have not been recovered at all. Though the severity remains low, there are high risks. Those vulnerabilities which have not updated or recovered can easily be used by attackers. 2. Asymmetry between IoT attacks and their preventions IoT security protection is at an early stage, since IoT manufacturers are busy improving basic functions and hence there are considerable IoT devices with low protection quality. Besides, the users’ lack of awareness of security makes it easy for attackers to take IoT as their target. NSFOCUS finds that in the past year, the most frequent attack has been launched by a botnet composed of Netcore devices, and the malware sample is named Gafgyt. By 2018, the influence of Netcore devices has been expanding, with 4.4 million attack warnings detected every day.20

19 NSFOCUS.

Annual IoT Security Report 2017. http://www.nsfocus.com.cn/event/iot_security/ 2017_IoT_Security_Annual_Report.pdf, March 29, 2018. 20 NSFOCUS. Annual IoT Security Report 2017. http://www.nsfocus.com.cn/event/iot_security/ 2017_IoT_Security_Annual_Report.pdf, March 29, 2018.

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6.2.8 AI as a Double-Edged Sword 1. AI, a new means of cybersecurity protection As a general technology, AI is a new means of guaranteeing cybersecurity and improving economic and social risk control,21 playing a key role in cybersecurity vulnerability detection, malware identification, and prevention of cybercrime. It can shorten the time of traditional software’s detection of vulnerabilities and detect the lightest code change out of millions of characteristics of suspicious documents. It can be combined with all kinds of crime models for the building of the cybercrime prevention mechanism. 2. New cyber risks caused by AI AI may cause three new cyber risks, namely, data security risks and data pollution attacks, model security risks and escape attacks, and code security risks. They may cause denial service, information breach, and system hijack because of malicious input, disorder of identification systems driven by AI and hence missed or wrong judgement and even system collapse or hijack, and transfer of smart devices into botnet attack tools.22 3. AI having its own security risks AI learning frameworks and components have their vulnerability risks, so do the sensors, training data, and open sources that it relies on. According to AI Security Whitepaper, the R&D of AI products and applications relies on AI learning frameworks and components released by technology giants like Google, Microsoft, Amazon, Facebook, and Baidu, but these open-source frameworks and components lack strict testing management and security certification.

6.3 Cybersecurity Protection Measures in Some Countries In recent years, all countries have been paying attention to cybersecurity, and they have taken a series of measure in accordance with their situation and Internet development to guarantee the security of their economy, society, and people.

21 China Academy of Information and Communications Technology. AI Security Whitepaper. http:// www.caict.ac.cn/kxyj/qwfb/bps/201809/P020180918473525332978.pdf, September 18, 2018. 22 Jiang Wei. How to prevent AI penetration into black cyber industry. China Information Security, 2018(5).

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6.3.1 Cybersecurity Strategies and Laws Being Improved 1. Formulation and upgrading of national strategies In September 2018, the United States launched its National Cyber Strategy, which proposes four pillars, ten objectives, and 42 prior initiatives to tackle cyber threats, enhance its cybersecurity, and facilitate cyberspace to be the engine of its economic growth and innovation. Ukraine Cabinet approved in July 2018 Action Plan for National Cybersecurity Strategies (2018), which proposes 18 missions of supporting cybersecurity supervision and improving national cybersecurity technology. In June 2018, Canada issued its new version of cybersecurity strategy to enhance cybersecurity protection and counter cybercrime. So far, over 70 countries have launched their national cybersecurity strategies. 2. Cybersecurity laws and regulations being improved In October 2017, the United Kingdom released its new version of Secure Access to Internet (draft), and in March 2018, it released Intelligent Devices Security Draft (proposal), requiring that manufacturers should enhance prevention measures to improve the security of intelligent networking devices. The president of Ukraine signed in November 2017 the new cybersecurity law named Principles for Guaranteeing Ukraine Cybersecurity, which authorizes the president to coordinate cybersecurity through the National Security and Defense Committee of which he is the leader. The Singapore Parliament passed on February 5, 2018 the Cybersecurity Bill to enhance the protection of computer systems for basic services and to prevent cyberattacks. In March 2018, Senate Homeland Security and Government Affairs Committee of the United States passed Reauthorization Bill, in accordance with which a number of cybersecurity supervision measures were approved. In April 2018, the U.S. House of Representatives passed National Defense Authorization Act, according to which cyber power should be enhanced to protect critical infrastructure and consolidate cyber responsibilities. The House launched Advancing Cybersecurity Diagnostics and Mitigation Act to push Department of Homeland Security to regularly update the continuous diagnostics and mitigation cyber monitoring plan. The president of Poland signed the Cybersecurity Law passed by the Polish Government in May 2018, and the law is a framework for the national cybersecurity system. In June 2018, European Commission’s Telecommunication Committee formulated the general principle for the cybersecurity law draft, which proposes the creation of the mechanism for the building of EU cybersecurity certification framework for special ICT procedures, products, and services. According to the draft, the present ENISA will be upgraded into a permanent EU cybersecurity agency. Bulgaria has passed the cybersecurity law draft introducing a new framework to better prevent national cybersecurity risks and incidents.

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6.3.2 Cybersecurity Mechanism Construction Being Enhanced In the recent two years, the United States, Saudi Arabia, India, and Singapore have enhanced their cybersecurity mechanism construction by establishing special cybersecurity departments and clarifying the government’s cybersecurity functions. For instance, Saudi Arabia has set up the national cybersecurity bureau to enhance the national cybersecurity and protect the national interests, security, and sensitive infrastructure; and India has set up an anti-extremist department and a cybersecurity department in the Ministry of Internal Affairs, and has formulated measures for countering cybercrime and preventing cyber threats. The Indian Government decided in December 2017 to set up the third NIC-CERT, which is responsible for protecting the governmental information infrastructure. The U.S. Department of Justice has announced the establishment of the cyber digit working group, which will assess and solve the abuse of the Internet by terrorists and common users. In April 2018, Australian Cyber Security Co-operative Research Centre (CRC) was put into operation in Perth to improve the country’s competence in cybersecurity research, development, and commercialization.

6.3.3 Enhanced Critical Information Infrastructure23 Security Protection 1. Strategic documents and laws and regulations The United States has approved and amended IoT Cybersecurity Improvement Act, Framework for Improving Critical Infrastructure Cybersecurity, and Multiyear Plan for Energy Sector Cybersecurity to emphasize the combination of countering and prevention and to enhance the cybersecurity protection of critical infrastructure and help all organizations to reduce cybersecurity risks. Brazil has launched IoT: an action plan of Brazil and initiated the national strategic IoT planning. The United Kingdom put its new law of implementing EU Directive on Security of Network and Information Systems (NIS Directive) into effect in May 2018 to ensure that the cybersecurity protection capacity of the most critical industries is improved. 2. Special technical forces The Indian Police has created moral hacker forces named Khaki Hats to protect the national critical infrastructure from cyber threats. The UK National Computing Centre (NCC) has set up the new-generation CENTA to protect the security of the government, the central bank, and supervision institutions. CENTA provides global 23 Critical

information infrastructure is referred to as critical infrastructure in overseas laws, regulations, and policies.

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cybersecurity consulting for overseas central banks and supervision organizations and helps relevant institutions to design cybersecurity supervision systems. The U.S. Department of Homeland Security has set up the National Risk Management Center (NRMC) to prevent cyberattacks and defend the security of the national critical infrastructure. 3. Improved response capacity Turkey has launched the national cybersecurity drill to test critical infrastructure’s capacity of responding to cyber threats. The United States held Cyber Limit 2018, Yankee Cybersecurity Drill, and Cyber Storm to enhance cybersecurity protection of infrastructure of finance and medical care. ENISA organized in June 2018 Cyber Europe 2018, a drill oriented to the protection of critical infrastructure like airports, in which 30 countries participated. 4. Early warning and severe punishment The government of Denmark has announced that the country will increase investment in improving the early warning capacity of the national cybersecurity center to capture all cyber threats to energy, telecommunication, and financial systems. The UK government announced in October 2017 that any organization that has failed to take effective cybersecurity measures within the country will be fined 17 million pounds or 4% of its global revenue.

6.3.4 Reinforced Data and Privacy Protection 1. Data and privacy protection systems In March 2018, the United States launched a series of measures such as Clarifying Lawful Overseas Use of Data Act and Digital Identity Management to enhance the users’ privacy protection. EU Judiciary Committee passed the amendment of Electronic Communications Privacy Directive to protect telecommunication privacy, data confidentiality, and personal rights and interests. In May 2018, General Data Protection Regulation (GDPR) issued by EU came into effect. The United Kingdom proposed the amendment of Data Protection Act to expand the investigation right of information commissioners. In July 2018, France listed “countering the extension or unreasonable use of personal data” into the act of constitutional revision. Australia released in November 2017 Digital Identity Trust Framework, which proposes the regulations on the unified management of digital identity. Data Breach Notifications Act was put into effect in February 2018. Brazil passed in July 2018 Personal Data Protection Act, in accordance with which a system of domestic personal data protection was established.

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2. Judiciary protection A court in Berlin of Germany has made the verdict that in case no sufficient notification of data use scope is made, Facebook’s provision of personal data within Germany for the third-party supplier was a violation of the Data Protection Act of Germany. The U.S. Supreme Court has agreed to accept the privacy dispute between the Department of Justice and Microsoft. It is about whether the procuratorial authorities can access the emails on overseas servers of Microsoft. Moscow Court of Russia fined Telegram, the instant message software, 800,000 rubles because the latter had failed to provide the national security agency with the secret key to users’ telecommunication data. Belgian judiciary authorities ruled that Skype should be fined for refusing to submit the users’ message data. 3. International cooperation in data circulation The United States, Japan, and Singapore proposed to the World Trade Organization (WTO) that cross-border data should be circulated freely in electronic forms, that server localization should be forbidden, and that the government’s access to privacy data should be clarified. The Japanese government and EU reached an ultimate agreement in July 2018 on their cooperation framework concerning flexible personal data transfer, which marked “the emergence of the world’s largest region of personal data circulation security”.

6.3.5 Talent Production and Cybersecurity Awareness Cultivation 1. Multi-channel discovery and production of talents The U.S. FBI announced in October 2017 that the cybersecurity education pilot program will be launched throughout the country. In the program, cybersecurity talents will be selected through the establishment of scholarships and major courses. The United Kingdom is committed to producing new-generation hi-tech guards by recruiting high-level technical talents, cooperating with start-up cybersecurity businesses, and publishing Christmas Puzzle. Singapore began in January 2018 to implement MINDEF Vulnerability Rewarding Plan, according to which white hat hackers selected from the world are authorized to “attack” the networking systems of MINDEF to discover vulnerabilities. 2. Increased cybersecurity capital input The U.S. Department of Homeland Security appropriated in December 2017 USD1.4 billion for the operation and support of cybersecurity. In accordance with Cybersecurity National Action Plan (CNAP), a special presidential fund of USD 62 million has been set up for action plans carried out in different levels of schools to improve the

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public awareness of cybersecurity and to reserve high-end talents for future “cyber war”. In December 2017, Japan reached an agreement with ten ASEAN countries. According to the agreement, Japan will spend 500 million yen in the coming four years carrying out cybersecurity training for governmental staff of ASEAN countries. 3. Cybersecurity awareness promotion Countries and regions like the United States, Europe, and Japan host “cybersecurity awareness month” every year while Israel, China, and Australia host “cybersecurity publicity week” to improve the public awareness of cybersecurity, popularize cybersecurity knowledge, and create a healthy cyber environment.

6.3.6 Continuous Combat Against Cybercrime and Terrorism 1. Laws and regulations Egyptian Telecommunication and Information Technology Committee passed in April 2018 Cybercrime Law, in accordance with which websites or social media accounts encouraging crime and their persons in charge are fined or imprisoned. President of the United Arab Emirates issued in May 2018 the revised Cybercrime Law, which provides detailed articles about imprisonment and penalty against cybersecurity crime. 2. Increased capital input The United Kingdom will spend 50 million pounds from 2018 to 2019 improving the capacity of countering cybercrime and will launch combat against “dark network” crime. The United States has approved the appropriation of Congress for the Global Affairs Center to counter publicity and spread of fake information of terrorist organizations like the Islamic State. The Canadian government has announced that it will spend one billion U.S. dollars combating cybercrime. 3. Enhanced countering of cybercrime The United States is organizing a special organization combating cybercrime. It will collaborate with governmental agencies in countering cyber theft and fraud. The government of Pakistan decided in May 2018 to set up the national anti-terrorist cybersecurity investigation bureau to enhance the countering of cyberterrorism. 4. International cooperation in countering cybercrime In July 2018, Europol and Israel signed an agreement in the Hague on the solution to cross-border cybercrime. The United States, the United Kingdom, Australia, Canada, and the Netherlands announced in July 2018 the founding of Joint Global Taxation Enforcement to counter cyber financial crime including illegal use of encrypted currency.

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6.3.7 International Cooperation in Cyberspace 1. Cybersecurity cooperation among international organizations In September 2017, EU Commission proposed the reinforcement of ENISA and the establishment of a new European Cybersecurity Agency, so that EU members can be better coordinated to tackle cybersecurity threats. The Conference of G7 Finance Ministers and Central Bank Presidents in October 2017 passed a series of nonrestrictive principles to assess the efficiency of cybersecurity measures taken by finance sectors. British Commonwealth of Nations pointed out in April 2018 that by 2020, they will have taken cybersecurity actions to enhance their cybersecurity capacity and to jointly tackle threats to state actors by global crime groups and enemy countries. In April 2018, Australia announced that it would become a member of NATO Cooperative Cyber Defence Centre of Excellence (CCDCOE). 2. Bilateral cybersecurity cooperation In February 2018, the United States passed Cooperation with Ukraine in Cybersecurity Act 2017 to promote their cooperation in cybersecurity protection. The U.S. Finance Service Information Sharing and Analysis Center has signed with Singapore Cybersecurity Bureau a three-year cooperation agreement to enhance cybersecurity threat intelligence sharing and carry out cybersecurity drills. Indonesia and Australia have jointly formulated cyber defense standards to cooperate with each other technically in incident handling. Singapore and the United Kingdom have signed a cooperation MOU in cybersecurity capacity building to carry out for British Commonwealth Nations a two-year cybersecurity capacity-building project.

6.4 Development of World Cybersecurity Industry 6.4.1 Status Quo of World Cybersecurity Industry Development 1. Steady growth of world cybersecurity industry According to the reports of International Data Corporation (IDC)24 , Gartner,25 and Persistence Market Research (PMR)26 , the volume of the world cybersecurity industry in 2017 was over USD 80 billion, and it is expected to reach USD 87 billion 24 IDC.

Worldwide Semiannual Security Spending Guide, https://www.idc.com/getfile.dyn?contai nerId=IDC_P33461&attachmentId=47324751, March 2018. 25 Earl Perkins. Top Cybersecurity Trends for 2018. Gartner. 26 PMR.Global Market Study on Cyber Security. May 2017.

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Fig. 6.2 Market volume of the global cybersecurity industry (2016–2018) (unit: 0.1 billion U.S. dollars)

to USD 100 billion. Its growth rate reached an unprecedented height in 2015, namely, 17.3%, and dropped to 7.9% in 2018. The market volume of the global cybersecurity industry from 2016 to 2018 is seen in Fig. 6.2. 2. North America, West Europe, and Asia-Pacific taking the leading North America with the United States as the leading country in cybersecurity industry ranks first in market volume, then come West Europe and the Asia-Pacific region. In 2017, North America saw the market volume of cybersecurity industry reaching USD 34.3 billion, accounting for 38.5% of the world’s total; the market volume of Western European countries including the United Kingdom and Germany reached USD 23 billion, accounting for 25.8%; that of China, Japan, and Australia was USD 18.8 billion, accounting for 21.1%; that of Africa and the Middle East, East Europe, and Latin America was USD 13 billion, accounting for 14.6%. On the CyberSecurity 500 List for 2018 of hottest and most innovative businesses released by CyberSecurity Ventures, most of them are from the United States, totally 358; 67 from Europe and 20 from Asia.27

27 Cybersecurity

Ventures, Cybersecurity 500 list for 2018, https://cybersecurityventures.com/cyb ersecurity-500-list [OL], February 23, 2018.

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6.4.2 Measures of Different Countries to Facilitate Cybersecurity Industry 1. Cybersecurity talent program The U.S. Department of Commerce and Department of Homeland Security jointly released on May 30, 2018 Supporting Sustainable Development of National Cybersecurity Workforce: constructing a safer foundation for the United States, in which the vision of the country’s public and private sectors’ cybersecurity workforce is defined as whether to successfully protect the U.S. homeland security and economic prosperity and to guarantee the foundation of the nation’s competitive advantages. In April 2017, Japan founded the Industrial Cybersecurity Center for the cultivation of workforce countering cyberattacks, requiring all trainees to acquire the latest technology against cyberattacks. ROK proposes in Republic of Korea ICT 2020 that 19,000 cybersecurity jobs will be created. In September 2018, China Information Technology Security Evaluation Center released Cybersecurity Talents Development White Paper 2018, in which analysis of characteristics of cybersecurity practitioners, demand for such practitioners, and their training are made. 2. Cooperation between government and businesses The UK Telecommunication and Europol have signed an MOU, in which they agree to share intelligence about major cyber threats and attacks. The UK government has launched the “accelerator” program, through which the government contacts programmers and then they can discuss complicated cybersecurity problems. On August 1, 2017, the U.S. Department of Homeland Security announced that it would cooperate with Facebook and Twitter in eliminating hazardous content in cyberspace and combating violent extremism. In January 2018, the Department announced that it would further its cooperation with the U.S. intelligence agencies in sharing information concerning malware, virus, and botnets. It will also provide private sectors with tools, resources, and relevant information, so that the latter can take active measures to counter cyber threats. In April 2018, the Japanese government hosted a headquarter conference on cybersecurity strategies, at which it was proposed that the government should cooperate with private businesses in active cyber defense with preventive actions and in sharing information about cyberattacks.

Chapter 7

Legal Construction for Internet

7.1 Overview The new-round technology and industrial revolution represented by IT have brought about new challenges to cybersecurity protection and digital economy development while boosting social and economic development. For the Internet, all countries are accelerating their legislation, improving their systems, and enhancing the enforcement of their laws and regulations. In terms of cybersecurity, they keep improving toplevel legal systems and strategic frameworks, facilitating the construction of critical infrastructure protection systems, upholding their data sovereignty through legislation, improving cyber content control and personal information protection systems, and establishing and improving new technologies and new business. In terms of digital economy development, they are establishing digital trade rules, coordinating policies and positions of different countries, and trying to build international rules on tariff, digital flow, market admission, digital divide, and other key areas. (1) All countries keep establishing and improving their top-level legal and strategic framework systems. Data sovereignty is the new area of cyberspace legislation competition. (2) All countries are strengthening their management over illegal cyber content and clarifying the accountability for the content of cyber service providers. (3) Personal information protection is a key legal issue in the era of digital economy. With the demonstration of EU GDPR, a new wave of personal information protection is stirred up, and the relief mechanism and supervision of law enforcement are improved. (4) New technology and new business are the new drive for the global economy, but there is an immediate need for some legal control. All countries’ legislation and policies, generous and prudent, encourage innovation, regulating admission management through legislation, and they have set up special management organizations to create good ambiance and systems for the development of new business. © Springer Nature Singapore Pte Ltd. 2020 World Internet Development Report 2018, https://doi.org/10.1007/978-981-15-4067-7_7

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(5) The rising digital trade promotes the construction of global digital trade rules. All countries are establishing new rules for service sector admission and crossborder data flow, with developed and developing countries having their own focus.

7.2 Cybersecurity Legislation and Universal Wish to Safeguard Cyber Sovereignty Over the past year, all countries have accelerated the establishment and improvement of top-level cyber systems, taking critical infrastructure as the key target of protection, and consolidating cybersecurity guarantee foundation. Meanwhile, cross-border data flow poses a challenge to the traditional sovereignty concept, and data sovereignty is the new area of competition in cyber legislation.

7.2.1 Accelerated Cybersecurity Legislation Most countries have not formulated unified cybersecurity laws, but Asian countries are making faster progress in cybersecurity legislation. Cybersecurity Bill promulgated by Singapore in February 2018 provides that the capacity of 11 critical facilities should be enhanced to tackle cyberattacks, cybersecurity incident response and prevention mechanisms should be established, and cybersecurity information should be shared. In March of the same year, the Japanese government submitted the amendment of the Cybersecurity Law to the Parliament, which marked a new stage of cybersecurity planning. The amendment is aimed at the establishment of a new organization, a multi-entity committee of the public and private sectors, who can thus cooperate with each other, share information, and discuss necessary measures.

7.2.2 Simultaneous Legislation and Standardization of Critical Infrastructure Protection Critical infrastructure is becoming the key protection target of all countries in their cybersecurity legislation. They are making laws for the establishment of critical infrastructure protection systems and formulating industrial standards to facilitate the implementation of the systems. With the increasing connection and integration between critical infrastructure and the Internet, there are more complicated security hazards for the infrastructure. In March 2018, the Australian Parliament passed Critical Infrastructure Security Bill. The country has established the mechanism for critical infrastructure protection registration and ministerial directives, and a critical infrastructure protection center,

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having enhanced the government’s capability of interfering with the operation of critical infrastructure. Standards for critical infrastructure are an effective supplement to cybersecurity laws. The United States has set up a critical infrastructure security framework to guide the industry. In April 2018, the U.S. National Institute of Standards and Technology (NIST) released Framework for Improving Critical Infrastructure Cybersecurity, which applies to industries critical to the nation and its economic security. From April 2018, the Japanese Cabinet National Information Security Center began to collect public opinions on Assessment Standards for the Degree of Cyber Attacks’ Damage to Critical Infrastructure (Trial), which is aimed for the establishment of standards for the degree of cyberattacks’ damage to critical infrastructure and will be taken as the standards for the government’s judgement on countermeasures and the basis for public and private sector information sharing systems and methods.

7.2.3 Upgraded Data Sovereignty Conflicts Forming a New Area of Cybersecurity Competition In the era of cloud computing, cross-border storage of data gives rise to jurisdictional disputes among law enforcement agencies on data acquisition. All countries attach importance to data value and security, so protection of personal data security is one of the targets of laws. Besides, the sovereignty of data administration is a key factor in competition among countries. Since there is yet no international rule, it is the prior choice for countries to safeguard their data sovereignty through their own laws. The United States and EU tend to exercise “long-arm jurisdiction” over data, having formulated relevant laws and expanded judicial and law-enforcing scope. In March 2018, the former issued Clarifying Lawful Overseas Use of Data Act (also called CLOUD Act), providing clear authorization for user data stored overseas by businesses operated within the country. The act has expanded the U.S. law-enforcing agencies’ power over the acquisition of overseas data, providing convenience for qualifying foreign governments for cross-border law enforcement while possibly invading the cyber sovereignty and national security of non-qualifying countries. EU has published the E-Evidence Proposals, which allows law-enforcing agencies to acquire data stored overseas by businesses operated in EU. The EU proposals do not only apply to EU citizens. Law-enforcing agencies can acquire personal data of citizens of any other country as long as the data is related to EU investigations, provided that the minimum punishment of the crime involved in the case is three-year imprisonment. Column 9: “Long-arm Jurisdiction” Case of U.S. Cross-border Data Acquisition In 2013, FBI proposes to the court that it should acquire user data concerning crime from Microsoft, who provided the information stored in the server within the United States, but refused to provide the information and emails stored in the server within Ireland by the excuse that the acquisition might violate laws of Ireland and that the search directive might

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be ineffective overseas. From 2013 to 2018, after a three-level court trial, the Supreme Court revoked the case in April 2018 when CLOUD Act was launched, since according to the act, the search directive is effective overseas and there is thus no legal dispute over the case. Chinese businesses used to be subject to the “long-arm jurisdiction” of the United States. For instance, in 2015, Bank of China was deemed as “contempt of court” when its branch in the United States refused to provide the account information of the accused in the GUCCI case for the U.S. District Court of the Southern District of New York, and thus it was fined a huge sum of USD 50,000 each day on a daily accumulative basis.

7.3 Enhanced Cyber Information Supervision and Cyber Service Providers’ Social Responsibility New media represented by information technology has promoted the innovation of modern transmission ways and tools, but poses new challenges to cyber information administration. Rumors, slanders, and infringements on the Internet are problems confronted by all countries, who are promoting the construction of cyber information administration systems through legislation and law enforcement.

7.3.1 Cyber Information Supervision and Cyber Servicer Providers’ Social Responsibility It is a consensus to require cyber service providers to shoulder more administrative responsibilities. The Indian government announced the procedures and privileges for the cutoff of Internet service, allowing the government to take special actions in a public emergency or for the sake of public security. In December 2017, the United States re-authorized the effectiveness of Article 702 of the Foreign Intelligence Surveillance Act (FISA) and prolonged it to 2021, making it clear that technology businesses can be forced to open the back door without the approval of the foreign intelligence surveillance court. The country also passed the Honest Ads Act, requiring Facebook and Twitter to keep complete the information of political advertisement buyers on the recording platform. EU requires to enhance websites’ management responsibilities. In September 2018, the European Parliament passed the Copyright Law, which offers clear provisions on websites’ responsibilities for reviewing copyrights, requiring Facebook and YouTube to enhance copyright review. Australia launched three laws, namely Election Legislation Amendment 2017, Foreign Influence Transparency Scheme Act, and National Security Legislation Amendment 2017 to impair the political influence of overseas powers. Germany began to implement the Social Media Regulation from January 1, 2018, requiring social network platforms in the country to shoulder their responsibilities for removing any information concerning slanders, defaming, new Nazi, and violent instigation.

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7.3.2 Governmental Promotion of Industrial Self-discipline and Countering of Illegal and Fake Information Besides formulating and improving legislation, all countries are guiding industrial self-discipline and improving relevant management systems and facilitating businesses to perform their duties. In recent years, with the expansion of cybercrime and terrorist information, all governments have begun to reexamine the duties of cyber service providers. In September 2018, European Commission required technical and advertising businesses to submit their code of conduct disciplining themselves and to adopt extensive measures to ensure political advertisement transparency, closing of fake accounts, and prevention of fake information spread. The commission will make a regular examination and supervision over the execution of the code of conduct.1 It will take further actions in case they have failed to fulfill the code of conduct to the expected effect.

7.3.3 Supervision Collaboration and Establishment and Improvement of Law-Enforcing Methods Concerning Cyber Content Administration Cyber content administration is a common problem confronted by all countries, especially fake news administration. They have set up special agencies and inter-sector coordination mechanisms to enhance law enforcement concerning cyber content. The Italian government has set up its official portal website to publicize fake news related to election. Italian citizens can report fake news to the police through the link for reporting. Polizia Postale checks the fake news and put the checking result on the official news portal website. In case the fake news violates the law, competent authorities will take legal actions. ROK has found a special governmental working group who is responsible for defining accountability for wrong information on the Internet. So far, the working group has raised over 500 lawsuits against individuals or organizations releasing malicious information. Indonesia has organized a national cyber encryption agency and appointed the person in charge. The agency will collaborate with intelligence and law-enforcing sectors to counter fake information on the Internet before the national poll. The UK government takes “cracking down on fake news” as part of its national security system, having set up a special action group countering fake news to control the spread of fake information.

1 http://europa.eu/rapid/press-release_STATEMENT-18-5914_en.htm.

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7.4 Legislation on Private Information Protection and Its Backup Mechanism Personal information protection is a legal issue in the era of digital economy. All countries are reinforcing the legislation and law enforcement on that matter. Recently, EU and the United States are promoting to the world their legal policy systems conforming to their own values and interests, and keep improving relief mechanisms and supervision of law enforcement concerning personal information protection.

7.4.1 EU GDPR Having Stirred up a New Wave of Legislation on Personal Information Protection Across the World After two years of transition, General Data Protection Regulation (GDPR) was put into official effect in all EU member countries on May 25, 2018, which marked a new chapter in personal information protection within EU. GDPR has enhanced the personal data protection rights in the era of data, providing a single data rule for EU businesses and producing an influence on legislation and supervision agencies and businesses of the world. EU members are seizing the time in updating their laws to make them consistent with GDPR. To implement EU GDPR and EU Data Protection Directive on Police and Criminal Justice Cooperation, the French National Assembly has passed the new Draft Data Protection Act, having channeled some content into their own laws. EU members are carrying out law enforcement in accordance with GDPR. On September 21, 2018, the UK Information Committee Office (ICO) issued a law enforcement notice to Aggregate IQ (AIQ), a Canadian big data analysis business, who had violated GDPR. Facilitated by GDPR, emerging countries like India and Brazil have formed or are going to formulate special personal information protection laws to set up central agencies of personal information protection supervision, to promote the implementation of international principles on personal information protection, and to improve their own laws and supervision. India has proposed the draft of Personal Data Protection Act, which is applicable to data collected by businesses registered under Indian laws. The act also proposes the founding of Indian Data Protection Agency (DPA) to guarantee the implementation of relevant laws. Brazil has formulated the General Data Protection Act, a comprehensive law which provides details on personal data collection, use, disposal, and storage, involving all businesses in Brazil and having an impact on all private and public entities.

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7.4.2 Enhanced Data Subjects’ Rights Protection and Severe Punishment on Liability Subjects Both EU GDPR and personal data protection acts promulgated by the U.S. states enhance the protection over data subjects’ rights and provide accountabilities of liability subjects like data owners and disposers. The rights of data subjects are enriched. EU GDPR has detailed provisions on the rights of data subjects, whose control over personal data is enhanced. Colorado of the United States has issued Consumer Privacy Protection Act, requiring businesses to make written policies covering the destruction and disposal of the document containing personal information. The legislation of California is stricter, with the establishment of the right to be forgotten, as is provided in GDPR. Businesses are required to delete, in accordance with the checkable request of consumers in California, designated personal information of consumers that they have collected, and to make service providers delete the consumers’ personal information. Data owners’ and disposers’ obligations are clarified and enhanced. EU GDPR provides data owners’ responsibilities for document management, data protection impact assessment, data breach notification, and security guarantee. Notably, GDPR involves data disposers in it, providing the same requirements for them as for data owners. The United States and EU have recently made laws stipulating the relationship between the responsibilities of data owners and their cooperative service providers. GDPR provides detailed articles about the content of contracts between data owners and disposers. Nebraska of the United States has signed Legislative Bill 757, which stipulates that commercial entities should, through a contract, require their service providers to set up and maintain rational security procedures and conventions. Colorado stipulates that any business that discloses any information to the third party shall propose security management requirements to the third party.

7.4.3 Improved Supporting Rules and Aid Mechanisms Concerning Personal Information Protection Different countries have launched guidelines for the application and protection of data. Personal Data Protection Committee (PDPC) of Singapore has formulated a series of guidelines. For instance, Guidelines on Consultation about Personal Data Protection Law concerning ID Cards and ID Numbers of Other Countries gives guiding suggestions on the use and collection of ID cards issued by Singapore or other countries. ENISA has released Personal Data Processing Security Manual. Administrative and judicial aid in personal data protection is reinforced. According to GDPR, any entity or individual can resort to judicial aid when they are not convinced of the decision made by any supervision agency or any supervision agency fails to take action. Data subjects can claim through judicial ways to data owners or data disposers for material or nonmaterial loss caused. Judicial aid rights

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can be exercised by consumer agencies on behalf of data subjects. The United States and EU have signed EU-U.S. Privacy Shield, which provides aid means. According to it, citizens from EU members can appeal to supervision commissioners, who can transfer the complaint to the U.S. Department of Commerce and the Federal Trade Commission. No charge is paid for such aid.

7.5 Standardization of New Technology and New Business to Guarantee Cybersecurity as the Prior Objective Thriving new technology and new business is the new drive for the global economy, but there is an immediate need for some legal control. All countries’ legislation and policies, generous and prudent, encourage innovation, to create good ambiance and systems for the development of new business.

7.5.1 Laws, Regulations, Strategies, and Policies Jointly Promoting the Development of New Technology and New Business To respond to threats from new technology and new business, all countries are taking legislative measures, setting up special administration agencies, providing stable policies, and facilitating innovative industrial development. Australia, to boost intelligent transportation, has introduced admission systems supporting the use of wireless technology and equipment for telecommunication in transportation. Australian Communications and Media Authority (ACMA), after some industrial consulting, have launched permits for intelligent transportation systems. These permits will aid vehicles in using wireless technology and equipment conforming to standards. ROK promotes the development of emerging industries and business through promotive legislation, having formulated Basic Act of Sharing Economy, in which “sharing economy” is defined, and according to which a sharing economy review committee is set up, agent business operators are designated, and the control over service providers is loosened. Governments of Seoul, Busan, and Kwangju have formulated or are formulating regulations on sharing economy development.

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7.5.2 Regulated Virtual Currency Supervision and Industry Chaos People worldwide are increasingly enthusiastic about investment in virtual currencies based on blockchain technology, so their security has become the hazard. Price fluctuation of virtual currencies, ICO (Initial Public Offering) frauds, exchange security vulnerabilities, and market manipulation as well as money laundering, smuggling, and tax evasion are all problems that urge supervision agencies of all countries to accelerate their legislation on virtual currencies and to enhance law enforcement so that admission and action of a new business can be regulated. In January 2018, the U.S. Commodity Futures Trading Commission (CFTC) raised a lawsuit for the first time against three virtual currency transaction platforms, claiming that they have cheated the clients and violated the rules on bulk commodities. ROK is going to make laws on virtual currencies, having proposed Special Act on Suspension of Virtualization and set up the regulation mechanism for virtual currencies. It is required that the business of virtual currencies should be permitted by the financial committee, the business record be kept, virtualization suspended, unfair transaction forbidden, security management conducted, and compensation made for users’ losses.

7.5.3 Road Testing Opened up for Automatic Driving and Policies Facilitating Innovative Development Legislation on automatic driving of all countries is focused on the definition of the legal position of automatic driving, security standardization, data utilization, and protection reinforcement and clarification of responsibilities and liabilities to ensure the healthy development of road testing of automatic driving. Over the past year, countries and regions like the United States, EU, and Japan have launched supporting policies on automatic driving road testing. Four states of the United States have allowed such testing on all public roads throughout the states, and California State has opened up the road testing, allowing to carry out some demonstration projects and promoting commercialization of automatic driving step by step. Besides, the Department of Motor Vehicles (DMV) has added Clause 227. 38 into the automatic driving supervision law, and has opened up public road testing permission to completely driverless vehicles. European Commission published in May 2018 the schedule for automatic driving advancement. Within EU, by 2020, automatic driving will have been allowed on highways, and low-speed automatic driving will have been done in some areas of cities. Completely driverless driving will have been realized by 2030 within the region. Japan is facilitating the development of long-distance automatic driving technology. It released in June 2017 Benchmark of Permission Handling of Long-distance Automatic Driving Road Testing, in which the long-distance monitor is defined as a driver staying a long distance away shouldering the obligations and

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responsibilities under road transportation laws and regulations, permitting automatically driven vehicles into road testing with no driver in the driver’s position in it.

7.6 New Problems and Challenges from Thriving Digital Trade and Relevant Rules Making as a New Issue International rules of digital trade are imperfect yet and are far behind practice, which urges all countries to have dialogues and cooperation in constructing general international rules by studying service sector admission and cross-border data flow and other key issues.

7.6.1 Gradual Construction and Enriching of Digital Trade Rules The focus of international trade negotiation is shifting from traditional trade and service rules to digital trade rules. Early e-trade principles were focused on free tariff on e-transmission, e-signature, and paperless trade, but in recent years, with the development of cloud computing and big data, negotiations over international trade are being expanded to cross-border data flow, computing facility localization forbidding, privacy protection, network opening up, and source code. In terms of multilateral/bilateral international free trade negotiations, EU and Japan signed in July 2018 Economic Partnership Agreement (EPA). In December 2017, at the ministerial conference of the WTO held in Buenos Aires, 44 WTO members, including the United States, EU, Australia, ROK, Japan, Brazil, Russia, Argentina, and Malaysia, signed a joint declaration on e-commerce, promising to carry out joint exploration and make preparations for future e-commerce negotiations within the WTO. Since 2018, the United States, EU, Japan, Russia, Brazil, Argentina, and Costa Rica have submitted their e-commerce proposals containing their demands and suggestions.

7.6.2 Continuous Explorations into Key Issues and Seeking for Common Ground While Allowing Difference as a Consensus In the era of digital economy, service sector admission is a universal concern. In the proposals submitted by WTO members in 2018, many members put the market admission of commodity and service trade related to e-commerce on their work agenda.

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The United States requires the updating of promises of service sector including communication under General Agreement on Trade and Service (GATS), so that they are adaptable to new technology. It also requires that Internet service competing with traditional communication service should be provided across borders. EU holds that service offered in e-commerce should conform to the principle of technology neutrality, and that except for telecommunication service and demand of public policies, no special pre-authorization procedures should be adopted for e-service. In EPA signed between EU and Japan, the rule of no pre-authorization is adopted. Canada proposes that “no promise” in market admission under the cross-border provision model should be changed into “no control”, and that the market admission limit should be eliminated for CPC 84 under the three models, namely, cross-border provision, overseas consumption, and commercial existence. Different from the countries mentioned above, who have proposed the expansion of scope, Brazil has proposed the negotiation framework for market admission, and it has also proposed that the promises made in the 1990s on the “cross-border” model should not be extended automatically to the completely new commercial models in the digital ambiance according to the principle of technology neutrality, but that negotiation should be done respectively in accordance with new and old promises. In terms of free cross-border data flow, there is a great difference in opinion between the United States and EU. The latter takes personal information as a human right which should be protected through legislation and restricts the transfer of personal data into another country which is not strong enough in personal information protection. The former puts personal data in the framework of consumer protection and attaches importance to ex post facto protection. Such a difference is an important reason for the suspension of the negotiation on Trade in Service Agreement (TISA). EU objects to channeling articles about data flow into TISA. In the e-commerce proposals submitted to the WTO by the United States and EU in 2018, their positions remain unchanged. The former proposes some clauses on cross-border data flow, data localization forbidding, and network block forbidding while the latter proposes no clauses on those matters. Japan has been in the same position as the United States in terms of cross-border data flow, but in EPA, the country has failed to adopt any substantial clause on cross-border data flow, but proposed that in three years after the agreement is put into effect, they should reassess free data flow. The United States and Japan have reached agreement on special information clauses about source code protection. They are in the same position on many clauses about digital trade besides the clauses about cross-border data flow and data localization forbidding. In the proposals they submitted to the WTO in 2018, they propose source code or algorithm protection, mandatory technical transfer forbidding, prejudiced technical requirements forbidding, limited use of special national encrypted standards, prohibition of improper governmental access to transaction secrets, to ensure that innovative achievement of their businesses will not be transferred to foreign rivals and that they can use the technology most applicable to their businesses.

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Besides, a new demand in their proposals is about governmental data opening up. In view that in practice, some foreign governments require businesses to disclose data of critical clients and transaction secrets, Japan proposes that governments should observe the clauses about proper procedures when accessing to industrial data and privacy.

Chapter 8

International Cyberspace Governance

8.1 Overview At present, the international governance of cyberspace is a major realistic issue confronted by all countries and various actors. To meet the challenges from new technologies and new business and the need to build peaceful, open, secure, and cooperative cyberspace, the international community is increasingly concerned with international cyberspace. In the past year, the complexity of that respect has gradually emerged, as shown in the following aspects: the formulation of norms for global cyberspace governance is relatively lagging behind, the differences in global cyberspace governance models still exist, and trust among actors needs to be strengthened.

8.2 Current Problems with International Cyberspace Governance As international cyberspace governance is moving into the deep-water zone, there are an increasing number of difficulties and challenges. The norms of the governance are still incomplete, and the dispute over the concept of “multi-stakeholder model” and “multilateral model” has not yet come to an end, and the trust among various actors needs to be strengthened. Although the international community has strong expectations for the reform of the Internet governance mechanism, there are difficulties in practice. Cybersecurity and cyber abuse have not been effectively resolved. The potential risks brought about by the development of the digital economy and AI have given rise to new governance problems facing the international community.

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8.2.1 Immediate Need to Solve the Lagging-Behind Standardization of Global Cyberspace Governance The relatively lagging-behind formulation of global cyberspace governance standards has restricted policy and capacity coordination for global cyberspace governance. Although more and more actors acknowledge that global cyberspace has become a new area of human activity, it is still difficult to reach a consensus on common norms with broad adaptability. It is an important issue facing the international community whether it is possible to formulate the standards and their implementation mechanism with multilateral and multi-actor participation based on mutual trust and dialogues and collaboration.

8.2.2 Differences in Governance Models Needing to Be Resolved Through Negotiation and Coordination The dispute over the model of global cyberspace governance is going on. How to form an effective consensus will produce a great impact on the development of global cyberspace governance in the future. One of the most important factors affecting the formulation of international rules for global networks is the difference in dominant principles and models, that is, the difference between traditional “multilateral” and “multi-stakeholder” models. With the practice of international governance, more and more countries realize that the two models have no essential difference in terms of governance subjects, but in the status and role of the government in the governance structure. The multilateral governance model emphasizes that governments of various countries take the lead and that multiple stakeholders participate in the international cyberspace governance. The multi-stakeholder model emphasizes the diversity of governance subjects, including governments, businesses, technical communities, research institutions, social organizations, and individuals. These subjects will be treated equally in the governance. The two models actually indicate that different countries have different choices of governance paths according to their specific practices at different stages of the Internet development. The international community should negotiate or collaborate on this basis to promote multilateral/multi-stakeholder governance rather than block the building of the global governance system and capacity and hence the sustainable development of cyberspace due to the coexistence of the two models. Over the past year, with changes in the international environment of cyberspace, more and more people are aware of the rationality and possibility of the coexistence of the two models. Diversified subjects should be encouraged to strengthen dialogue and negotiation to promote shared governance and common prosperity in cyberspace.

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8.2.3 Trust Among the Actors to Be Strengthened Mutual trust can increase the depth and breadth of cyberspace governance cooperation and lead to mutual benefit and win–win results. However, with the asymmetric distribution of network information resources and different degrees of dependence on network technology, as well as different interests in cyberspace, different actors adopt different decision-making mechanisms in international governance. Lack of trust makes it difficult to cope with some global issues of cyberspace, such as cyberterrorism, cybercrime, and cyber abuse. It is necessary to strengthen mutual trust to build an effective international cooperation mechanism for cyberspace governance.

8.2.4 Development of New Technologies and Applications Having New Demands for International Governance of Cyberspace Digital economy is increasingly becoming the focus of sustainable development in various economies around the world. There is yet no clear responsibility of the international governance mechanism and no perfect rules for the development of digital economy. More and more countries and regions have increasingly strong needs for data protection and network security, so they keep making legislation. Hence new policy barriers have been formed at certain levels. All these practices give rise to new challenges to the integration between digital economy and traditional industries, and how to eliminate the barriers is becoming a concern of the international community. New technologies and new applications, which are subversive and uncertain, urgently demand targeted governance tools and models for them.

8.3 Progress of International Cyberspace Governance Platforms Platforms still play a role in global cyberspace governance affairs. Facing new situations and new issues in international governance in the past year, each platform has made positive efforts and achieved different results in accordance with its own capabilities and characteristics.

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8.3.1 United Nations High-Level Panel on Digital Cooperation Digital technology crosses national borders in a unique way, and cross-sector, crossborder cooperation is essential to tapping the full social and economic potential of digital technology and mitigating the risks that the technology may pose. As the world’s largest international organization, the United Nations plays an irreplaceable role in the field of Internet governance. It established the High-level Panel on Digital Cooperation in July 2018 to strengthen cooperation in digital economy among governments, private sector, civil society, international organizations, and technological and academic circles. The newly launched high-level group will describe the development trend of digital technology, identify opportunities and challenges, and make recommendations for strengthening international cooperation in the digital field. It has set up offices in New York and Geneva, with 20 members from government, business, civil society, and academia.

8.3.2 International Telecommunication Union (ITU) The International Telecommunication Union (ITU) is the United Nations agency responsible for Information and Communication Technology (ICT) affairs. In October 2017, ITU held the World Telecommunication Development Conference (WTDC-17), with the theme “Information and Communication Technology for the Sustainable Development Goals”. The conference topics covered digital economy, network security, ICT technologies and applications, the telecommunication market environment and supervision, statistics, and other fields. In May 2018, the second Artificial Intelligence for Good Global Summit was held at the ITU headquarters in Geneva. The event focused on exploring the potential of AI to accelerate the realization of the United Nations Sustainable Development Goals (SDG). In November 2017, ITU released the ninth edition of the Measuring the Information Society Report 2017, ranking countries according to the level of their information and communication technology development.

8.3.2.1

World Summit on the Information Society

The World Summit on the Information Society (WSIS) is the most important platform for dialogue in the Internet field under the United Nations framework. It aims to explore how to make the digital revolution based on information and communication technology benefit the development of humankind. It is one of the world’s largest community of information and communication technology development. In March 2018, WSIS Forum was held in Geneva of Switzerland, with 2,500 ICT experts from the world participating in it. It focused on the sustainable development of key

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SDG areas like health, starvation, education, youth, inclusiveness, gender equality, environment, infrastructure, and innovation as well as their inclusive ICT measures.

8.3.3 Internet Governance Forum The Internet Governance Forum (IGF) is the highest level dialogue platform for global Internet governance discussion between governments under the United Nations framework. In December 2017, the 12th IGF Forum was held in Geneva of Switzerland, with the theme “Shaping Your Digital Future”. The topics covered the future of digital governance, digital economy, the Internet and ICT and sustainable development goals, AI, big data, IoT, IPv6, false information, data protection, digital literacy, information acquisition, digital divide, etc. In July 2018, the IGF held its second public consultation and Multi-stakeholder Advisory Group (MAG) meeting, at which reporting and discussions were made about global and regional Internet governance forum work, including proposal selection, special sessions, and best practice forums (covering AI, big data and IoT, cybersecurity, gender and access, local content, etc.), and the progress of the MAG Working Group.

8.3.4 Internet Corporation for Assigned Names and Numbers (ICANN) The Internet Corporation for Assigned Names and Numbers (ICANN) is the coordinating body that maintains the Internet’s unique identifier system and its secure and stable operation worldwide. Since its reform in 2016, ICANN remains one of the most important international organizations in the field of Internet governance. In 2018, community opinions were collected on GDPR deployment, Internationalized Domain Names (IDN), and Root Zone Key Signing Key (KSK) rotation. While enhancing its own capacity building, it also strengthens coordination with other institutions. For example, it signed an MOU with the Global System for Mobile Communications Association (GSMA).

8.3.5 World Internet Conference The World Internet Conference is a worldwide Internet event initiated by China and held annually in Wuzhen, Zhejiang. In December 2017, the Fourth World Internet Conference was held with the theme “Developing Digital Economy for Openness and Shared Benefits: Building a Community of Shared Future in Cyberspace”. The conference focused on five aspects: digital economy, cutting-edge technology,

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Internet and society, cyberspace governance, and communication and cooperation. China Internet Development Report 2017 and World Internet Development Report 2017 were released for the first time at the conference. The reports summarized historical achievements of Internet development, analyzed the characteristics and the status quo of Internet development, and established and released the World Internet Development Index System and China Internet Development Index System. The conference also released two fruitful documents: Wuzhen Outlook and Best Practice Cases of World Internet Development 2017. In November 2018, the Fifth World Internet Conference was held, at which important results such as China Internet Development Report 2018, World Internet Development Report 2018, and Wuzhen Outlook 2018 were released.

8.3.6 World Economic Forum The World Economic Forum (WEF) is an unofficial international organization that studies and discusses problems in the world economy and promotes international economic cooperation and exchanges. According to the WEF’s Global Risk Report 2018, cyberattack will be the third biggest risk worldwide in 2018, and cyber risks are affecting society and economy in new broader ways. In January 2018, at the annual meeting with the theme “making the common destiny in a differentiated world”, WEF announced the formation of a new global network security center to strengthen the existing measures (such as Cyber Resilience: Playbook for Public– Private Collaboration), to establish a library of best practices, to improve the partner’s understanding of network security, to promote the supervision framework, and to construct a future network security landscape think tank and thereby to build secure and reliable global cyberspace.

8.4 Participation of Traditional International Organizations in the International Cyberspace Governance Over the past year, traditional international organizations have increasingly taken international governance of cyberspace as their important work content, which shows that the pattern of global governance is undergoing continuous and profound changes.

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8.4.1 Group of Twenty Finance Ministers and Central Bank Governors (G20) In 2017, G20 Summit held in Hamburg of Germany attached great importance to cybersecurity and issued a number of documents related to cybersecurity governance. In particular, participants in the summit proposed that G20 should play a key role in critical infrastructure protection related to global economic stability, the fight against cybercrime and cyberterrorism, and other fields. In the declaration of the 2017 finance ministers’ and central bank governors’ meeting, participating countries focused on transparency and security in the context of digital economy and set specific goals on how to build a secure network environment, develop secure information infrastructure, and enhance trust among countries in the development of the digital economy. At the second G20 Consumer Summit held in Argentina in June 2018, the challenges and opportunities for consumers in 2018 and beyond were discussed, including new challenges and security of children’s access to the Internet.

8.4.2 BRICS In 2018, the 10th BRICS Summit issued the Johannesburg Declaration, in which the participating countries reaffirmed the responsibility of all countries for preventing terrorism, cyber financing, and terrorist actions within their own territories. They emphasized that all countries should enhance international cooperation, counterterrorism, and crime with ICT and that they should formulate a universally accepted legal instrument to combat ICT crime within the framework of the United Nations, while recognizing the progress made in cooperation in accordance with the BRICS Roadmap of Practical Cooperation on Ensuring Security in the Use of ICTs or other consensus mechanisms.

8.4.3 Asia-Pacific Economic Cooperation (APEC) In November 2017, the 25th APEC Leaders’ Informal Meeting adopted the APEC Internet and Digital Economy Roadmap and the APEC Cross-Border E-Commerce Facilitation Framework to strengthen cooperation in Internet and digital economy, bridge the digital divide, and share the digital dividend with more people. APEC has made significant progress in building a green supply chain cooperation network and an Asia-Pacific model port network, which has been unanimously recognized by member states.

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8.4.4 Shanghai Cooperation Organization (SCO) Cybersecurity with counterterrorism and international codes of conduct shaping as the core is always the concern of the Shanghai Cooperation Organization (SCO). According to the relevant resolutions of the SCO Regional Counter-Terrorism Agency Council, the SCO Xiamen-2017 anti-cyber terrorism exercise was held in December 2017. The delegations of the competent bodies of the eight member states and the delegations of the executive committees of regional anti-terrorism organizations participated in the exercise, which helped to improve the coordination capabilities of member states in terms of cybersecurity information sharing and action. In January 2018, a routine meeting of the International Information Security Expert Group of SCO member states was held in Wuhan of Hubei. In June 2018, cybercrime combat was taken as one of the three major focuses at the Qingdao Summit of SCO. According to the declaration at the summit, SCO member states will strengthen cooperation in the light of new regional security situation and cybersecurity issues and coordinate law enforcement agencies in intelligence information, judicial assistance, and law enforcement standards. Columnn 10: Non-state Actors In recent years, non-state actors have been playing an active role in international cyberspace governance. An important reason is that they have realized that the integrity and improvement of the international cyberspace governance system are of significance to the interest of nonstate actors. The participation of non-state actors in the international cyberspace governance is of long-term importance to the creation and improvement of the global governance environment. In April 2018, 34 technology and security companies, including Microsoft, Facebook, Cisco, Hewlett-Packard, Nokia, Oracle, Symantec, British Telecom, and Telefónica, signed a network security technology agreement, pledging to protect users’ information and not to help governments launch cyberattacks. In addition, Microsoft has released a guidebook on the Cybersecurity Policy Framework, suggesting that businesses and governments should conduct more cooperation in the development of security technology standards, information sharing, and establishment of mechanisms and specifications. In February 2017, the Global Commission on the Stability of Cyberspace (GCSC) officially presented itself at the Munich Security Conference, which attracted wide attention. At present, the committee is composed of more than 40 well-known cyberspace figures from nearly 20 countries. Its main sponsor is the Dutch government. Its secretariat is located at the Hague Centre for Strategic Studies (HCSS) in the Netherlands and East–West Center in the United States. On November 21, 2017, the first rule issued by the Commission was to defend the Internet’s public core. It means that without affecting their own rights and obligations, states and non-state actors cannot do or condone intentional material damage to the generality or integrity of the Internet’s public core and hence to the cyberspace stability. In addition to gaining support from the commission members, this rule has been recognized by civil society groups such as the Electronic Frontier Foundation (EFF) and Internet pioneers such as Vint Cerf. Therefore, it has produced a great impact.

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8.5 Internet Governance in Some Countries and Regions 8.5.1 The United States Taking the Lead in Top-Level Design of Cyberspace Strategies and Data Security Protection Legislation The United States attaches great importance to the strategic value of data resources, having successively introduced national strategies, implemented supporting measures, and systematically promoted the development of national big data. By strengthening data security protection, the country is improving personal information and data legislation, protecting the overall network and national security, national data rights, and its citizens’ rights. In March 2018, U.S. President Trump officially signed the Clarifying Lawful Overseas Use of Data Act (also known as the “CLOUD Act”), which provides a legal basis for law enforcement agencies’ acquisition of data stored on overseas servers, while allowing “eligible foreign governments” to issue orders on data collection to organizations within the United States directly after signing administrative agreements with the US government. In June 2018, the State of California introduced the Consumer Privacy Act, which is considered by far the most stringent data privacy bill in the United States. In September 2018, the United States issued the National Cyber Strategy, which proposes promoting the multi-stakeholder model of Internet governance, building interoperable and reliable Internet infrastructure, and promoting and maintaining the country’s innovation markets around the world. In late 2017, the U.S. Federal Communications Commission (FCC) decided to remove net neutrality protections, sparking a global debate about platform and data neutrality. Although there is no net neutrality at the international level, many global operators are based in the United States, and the U.S. decision might affect the development of the global network and practices of many other countries.

8.5.2 China’s Continued Pragmatic Participation in Cyberspace International Governance In December 2017, President Xi Jinping wrote a letter to congratulate the opening of the Fourth World Internet Conference and emphasized that China advocates the “four principles” and “five proposals” and hopes to work with the international community to respect online sovereignty and promote the spirit of partnership. According to Xi, all matters should be tackled through consultation to ensure common development, mutual maintenance of security, co-governance, and shared results. China is always ready to engage in bilateral/multilateral cyberspace cooperation at different levels in various fields. In May 2018, China–Germany consultation on cybersecurity under the framework of the two countries’ high-level security dialogue

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was held. During the consultation, the two sides exchanged views on the situation of cybercrime, legislation on cybercrime and security, and cybercrime and cyberterrorism combating. In July of the same year, the fifth round of China–Germany governmental consultation was held, during which the two sides deepened exchanges and cooperation in terms of cybersecurity and in secure cross-border transmission of data. Significant progress has been made in the exchanges and cooperation in cyberspace governance since then. In June 2018, China and Russia signed the Joint Declaration of the People’s Republic of China and the Russian Federation, according to which the two countries will expand exchanges in information and communication technology and digital economy, improve the interconnection of information and communication infrastructure, strengthen the cooperation in radio frequency and satellite orbit resource management, promote cyberspace development of two countries, and deepen mutual trust in cybersecurity. In September 2018, the Ninth China–EU Dialogue on Information Technology, Telecommunications, and Informatization was held in Beijing. The two sides reviewed the progress of China–EU cooperation in the field of information and communication after the eighth dialogue and had in-depth exchanges on ICT policy and digital economy, ICT supervision, 5G R&D, and industrial digitalization. China values and supports multilateral governance at the regional level, and participates in and promotes the integration of cybersecurity and development of digital economy into regional cooperation. In June 2018, the Qingdao Declaration issued by SCO called on the United Nations to play a central role in formulating universally accepted international rules, principles, and norms for the responsible conduct of states in information space. In September 2018, the tenth conference of BRICS leaders was held and a consensus was reached on promoting practical cooperation in cybersecurity and combating terrorism and crime through the abuse of ICT.

8.5.3 EU Legislation to Strengthen Personal Data and Digital Copyright Protection EU always attaches importance to cross-border data security policies and legislation. After GDPR went into effect in May 2018, EU immediately accused Google and Facebook of forcing users to agree to data collection, and would impose high fines. The strong law enforcement by EU has played a good warning and urging role, since Internet businesses such as Microsoft, Facebook, and Twitter all adjusted their privacy policies to improve their user data protection. GDPR has led to legislation on personal data in various countries, such as the United States, India, and Brazil. EU is enhancing the governance of digital copyright. In September 2018, the European Parliament approved through voting the Directive on Copyright in the Digital Single Market, which proposes the amendment of digital copyright regulations and allows news media to charge technology platforms for their copyrighted materials to

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protect the interests of Internet content creators and to facilitate Internet businesses’ protection of digital copyrights.

8.5.4 The United Kingdom Attaching Importance to Cyber Counterterrorism and Achieving Results in Cracking Down on Dark Websites The United Kingdom is committed to strengthening cyber anti-terrorism governance. In June 2017, the British Prime Minister Theresa May called for the re-formulation of standards for social networks including Google, Facebook, and Twitter to prevent terrorist activities in cyberspace. In September 2017, the United Kingdom, France, and Italy decided to shorten the time limit for the removal of Internet terrorism content to two hours. The United Kingdom has established organizations jointly combating criminals in dark web. In 2017, National Crime Agency set up a Dark Web Intelligence Department and cooperated with other cyber intelligence and enforcement agencies in combating criminal activities on dark websites. In July 2017, over ten countries, including the United Kingdom, the United States, and Canada, jointly closed down the world’s largest dark web platform AlphaBay, which engaged in the trading of drugs, weapons, and other illegal items. Thanks to the joint effort of multiple countries, AlphaBay, RAMP, Dream Market, and Hansa Market, the top four dark trading markets, have been closed.

8.5.5 A Multi-level Internet Governance System Formed in Russia Russia has formed a multi-level Internet information governance system with laws, institutions, and technologies as the main body. In recent years, the country has successively issued a series of documents such as the Concept of Russian Network Legislation, Legislation Development Concept in the Field of Information and Informatization of the Russian Federation, and Doctrine of Information Security and amended more than 20 laws including National Policy Law of Development and Utilization of the Internet and Law of Right to Information. As a country that strictly restricts the flow of cross-border data, Russia has successively promulgated the Law of Information, Information Technology, and Information Protection and the Personal Data Law of the Russian Federation, and basic rules for local storage of data. Russia is building cyberspace governance platforms. In July 2018, the International Cybersecurity Conference hosted by the Savings Bank of the Russian Federation and co-organized by the Digital Economy Organization and the Association

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of Russian Banks (ARB) was held. The meeting focused on the organized cybercrime combat, cyber risks in the digital transformation era, and strategic assessment and protection of confidential information, blockchain technology, and information security. Russian President Putin attended the meeting and called on all countries to establish a unified “rule of the game” and international standards in the digital technology industry.1

8.5.6 Rapid Internet Development and Data Protection Legislation in India India’s Internet and communications industry has developed rapidly. In 2015, the number of Indian Internet users rose to more than 400 million, higher than that of the United States, making it the second largest Internet country after China. In November 2017, the Fifth International Conference on Cyberspace was held in India and Prime Minister Modi was present. He emphasized the importance of cybersecurity and personal privacy protection. In July 2018, shortly after EU implemented GDPR, India promulgated the Personal Data Protection Law (Draft). In the same month, the country’s government approved the principle of net neutrality, claiming that any deviation from and violation of the principle of net neutrality will be severely punished. In 2018, the country participated in the SCO Summit for the first time as a full member. It will participate in the fight against cybercrime.

8.5.7 Cooperation in Data Privacy Protection Between Japan and EU According to GDPR, when EU member states transmit personal data to a third country, the latter must pass the EU’s “adequacy” protection standard. In July 2018, Japan and EU concluded negotiations on the basis of mutual “Adequacy Decision”, and the two sides agreed to start a procedure to identify each other as a region where “the protection of personal information is at the same level” and to ensure the security of data flow to promote the establishment of the largest global cross-border data flow zone. In September, the European Commission launched an “Adequacy Decision” procedure in Brussels, affirming Japan’s additional guarantee measures applicable to EU personal data transferred to Japan and the Japanese authorities’ commitment to obtaining personal data for law enforcement and national security. Japan promised that its data protection would be at the same level as that of in EU. At the same time, Japan adopted a similar process to recognize the EU’s data protection framework. This means that for that country, personal data is allowed to be transferred between 1 Speech by the Russian President Putin at the International Cybersecurity Conference. http://www.

kremlin.ru/events/president/news/57957.

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EU and Japan without any specific authorization; for EU, personal data transmitted to Japan enjoys strong protection in accordance with EU privacy standards. Japan became the first Asian country to win the “Adequacy Decision” from EU. Faced with the changes in the international cyberspace governance over the past year, countries, international organizations, and other cyberspace governance bodies have become increasingly aware of the importance and necessity of building a futureoriented international cyberspace governance system based on mutual trust and cogovernance. More and more forces in the international community have shifted from rational thinking to governance practices, from technological innovation to institutional innovation, and reached a consensus on building a peaceful, secure, open, and cooperative international governance environment for cyberspace. Looking ahead, the international community needs to further enhance mutual trust, communication, and cooperation and form a new pattern of co-governance. In order to achieve the UN 2030 Sustainable Development Goals, we should work together to build a community of shared future in cyberspace and create a better future.

Afterword

We have realized that today, the information revolution is progressing and the global IT is experiencing a new round of innovation. The Internet is changing the production and life styles and promoting economic and social development, which has turned the world into a global village and the international community into a community of shared future. To promote mutual sharing and co-governance of the Internet is an opportunity and a mission. It is hoped that the World Internet Development Report 2018 (the “Report” hereinafter) comprehensively shows and interprets the global Internet development status and trend from the perspective of China and provides China’s solutions to the problems of the Internet development, so that all the countries can promote their mutual development, safeguard their mutual security, participate in the governance together, and share the achievements. The compilation of the Report has won support and guidance from Cyberspace Administration of China, especially guidance from the leaders of the Administration and support in terms of data and material from the departments and institutions of the Administration. China Academy of Cyberspace, as the coordinator, has invited a number of think tank institutions to participate in the compilation, including China Computer Network and Information Security Center, China Academy of Information and Communication Technology (CAICT), China Industrial Control Systems Cyber Emergency Response Team (CICS-CERT), State Information Centre, Peking University, Beijing University of Posts and Telecommunications, and Xidian University. The participants in the compilation of the book are Yang Shuzhen, Fang Xinxin, Hou Yunhao, Li Yuxiao, Li Changxi, Liu Shaowen, Feng Mingliang, Xu Yunhong, Liu Bing, Jiang Wei, Chao Baodong, Li Zhigao, Tian Yougui, Long Ningli, Han Yunjie, Liu Yan, Dong Zhongbo, Wang Xiaoshuai, Ma Teng, Mu Chunbo, Yu Fengxia, Tian Li, Hu Jiarui, Sun Luman, Xie Yi, Yang Shuhang, Xiao Zheng, Li Wei, Chen Jing, Yuan Xin, Zhao Gaohua, Zhang Qiyuan, Wu Wei, Li Yangchun, Li Xiaojiao, Deng Yushuang, Shen Yu, Meng Qingshun, Long Chaoze, Wang Hualei, Yang Xuecheng, Liu Huailiang, Xu Yuan, Wang Xiaoqun, Fang Yu, Lang Ping, Wu Shenkuo, and Shen Yi.

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The publication of the Report is also owed to the support and help from society. Due to our limited experience, capability, and time for the compilation, there are probably errors in it. We sincerely hope that governmental agencies, international organizations, research institutions, Internet businesses, social associations, and people from all walks of life will offer their opinions and suggestions and provide more detailed materials so that we can make modifications and improvement to better contribute our wisdom and strength to the world Internet development. China Academy of Cyberspace October 2018