A decade ago, Chinese internet companies were still marginal internationally. Today, they are world-class industry innovators. In the internet economy, the leadership is shifting from the advanced West to the emerging East.

Today, China’s leading internet companies rival their counterparts in the West in terms of scale, value and innovation. Yet, their impact outside of China is still relatively limited. Even the international leader Alibaba generates less than 10% of its revenue outside China.

But things are changing. Chinese internet players are already expanding in other emerging economies particularly in Asia but also in Brazil and Latin America, as well as Africa. And as Chinese foreign investment has recently taken off, it is the internet companies that are pushing outbound investment and mergers and acquisitions. Third, these companies are exporting their disruptive business models.

And this is just the beginning.

From the US internet revolution to Chinese e-commerce revolution

In the late 1990s, the United States was amidst a technology revolution and I interviewed most pioneers of the early internet. It was an exciting time. America was the pioneer of the new cyberspace frontier.

Some 15 years later, I saw the coming of another transformation that would subvert the internet economy from within. That’s when I predicted that “China’s e-commerce explosion will shake the world.”  

Before 2008, there were barely 250 million internet users in China, but the internet penetration was still growing at 35% annually. Today, there are almost 700 million users, and the penetration is still growing at some 7% per year. Today, most Chinese spend a third of their time on mobile internet with WeChat and a tenth with QQ, while three giant companies – Tencent, Alibaba and Baidu – accounting for more than 70% of mobile time spent, according to US industry data.

In the process. Chinese e-commerce companies have become as big or bigger as their peers in America. If the US has its Wal-Mart, CVS, Kroger and Walgreens, China has its Alibaba, JD.com, China Resources and Suning.